Is “super” really a good investment?

Is “super” really a good investment?

By Greg Luscombe (CA + CPA)

This is the question I am most often asked as a financial adviser. It’s an important question, given that most people have a significant amount in superannuation these days.

Unfortunately, the answer isn’t just a simple yes or no!

My first response is to point out that superannuation refers to an investment ownership structure, and is not in itself a particular investment. The superannuation structure has special tax rules which provides significant tax savings for most people compared to other investment ownership structures.  As you know, saving tax is good!

While superannuation is the generic investment ownership structure for tax purposes, there are a number of alternative superannuation funds including:

• Not for Profit super funds,

• Industry super funds,

• Personal superannuation accounts and

• Retail super funds.

Each of these types of super funds have different cost structures, investment options, estate planning options and a variety of other features. These differences help to assess which type of fund is good for your personal circumstances. Is your head spinning yet? Wait there’s more …

The greatest point to consider when choosing your super fund, is where it invests your money. Each fund will have a unique mix of different underlying investments. Basically, there will be a combination of investments in the asset categories of shares, property, interest bearing loans or bonds and cash.

So, which super fund is best for you?

Well, the answer is …

It depends on all the above!

The investment performance of a super fund depends on the combination of asset categories, specific investment styles selected, selection process used by your super fund, and the choice of what is best for you, depending upon your personal needs.

Got that?

As you can see, getting good trusted advice about the options is crucial to choosing what is good for you. The tax concessions accessed by investing via a super fund are good for most people. The selection of a suitable type of super fund and most importantly the type and mix of investments owned via the super fund, will determine whether it is a good investment for you.

What now?

The best thing to do is to talk it through with your Financial Adviser.  Give one of our OzPlan Licensed Advisers at MB+M a call today on      5821 9177 to make an obligatory-free appointment.

Disclaimer:

The content in this article is for informational purposes only and does not constitute investment or financial advice. Any information or material is intended to provide general information only. MB+M, OzPlan Financial Services and its representatives make no representation as to its accuracy and completeness before acting on any information contained in this article. Each person should consider its appropriateness in regard to their own legal client responsibilities, financial situation and needs you should obtain independent taxation, financial and legal advice accordingly. 

OzPlan Logo

 

READY TO SIGN UP FOR A SUCCESSFUL FUTURE?

If you want to grow your business
and your wealth with a proactive,
forward-thinking team of experts,
let’s get started!

23 Nixon Street
Shepparton
Victoria 3630

03 5821 9177