Opportunity for planners in SMSF sector

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Although half of SMSFs believe they have strong or very strong knowledge about investments, a recent survey has shown a worrying lack of diversity in their portfolios. The new Intimate with Self-Managed Superannuation report has shown that cash and term deposits accounted for more than a third of SMSF investments last year, despite returns of just 4%. International equities returned 19.1% but accounted for only 6% of asset allocation on average.

Russell Investments CEO Asia Pacific Alan Schoenheimer said the concentrated allocations demonstrated a lack of diversification, and advisers played a pivotal role in educating SMSFs about different opportunities.

“Financial planners are well placed to educate trustees about the more recent adaptive asset allocation approaches employed by many funds – allowing them to readily adapt to changes in the investment environment and client circumstances,” said Schoenheimer.

He suggested planners broaden their advice services, “to include competency in new adaptive investment opportunities and other direct asset classes to provide strategic guidance to SMSF trustees and bridge the gaps in knowledge”.

SPAA CEO Andrea Slattery encouraged  planners to upgrade their skills and become specialist advisers in the SMSF sector to reap commercial opportunities highlighted by the research.

Key findings of the research showed:

  • SMSFs reduced holdings to Australian equities to 37.1% down from 43.5% in 2011
  • Cash and term deposits accounted for 33.9%, an increase from 25.6% in 2011
  • The majority (61.6%) of SMSFs relied on their own research to drive investment choices
  • Sixty-three percent of trustees said they were reasonably confident that were on track to achieving their retirement goals – 36.5% may fall short
  • SMSF trustees view traditional asset allocations as too inflexible

Do you see the rewards in becoming a specialised SMSF adviser?

  • Jack CFP on 15/02/2013 7:03:11 PM

    Conservative Accountant
    Everage balanced fund has returned around 12%... And that is what people have received...

  • Conservative accountant on 14/02/2013 12:08:53 PM

    You say that equities have returned 19.1% and you read where Australian Equities have returned such and such but that is not what people have received in their super funds. What are the realistic returns members have received over the last 12 months in say a balanced fund? Considering the risk and what trustees do know they may consider returns are ok.

  • Stephen on 14/02/2013 11:34:03 AM

    I thought you might like to see what some people think about SMSF's and high wealth. I don't know where he got his figures but you have to wonder about it.
    http://www.canberratimes.com.au/national/letters/with-the-rorts-superannuation-is-not-so-super-after-all-20130213-2edis.html
    This shows that some people just don't understand the benefits of good planning.

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