# Superannuation Panic



## Lurkin (20 November 2011)

Good morning all!

I'm new to Australia and have noted that there is compulsory superannuation. Subsequently I am trying to figure out which fund/ type of fund will be appropriate to invest it into, and have a few further queries as well:

- of the different funds types (retail, industry etc) it appears that industry will be the most appropriate (too small for SMSF, after the lowest fees thus out goes retail, not a government employee there goes public, employer fund - appears like investing proceeds from employment with an employer = higher risk, wrap platforms loss too much control) as it will offer low fees, an average return etc. 

I'm not worried about a return as this will act as the 'floor' of an overall portfolio. 

(at a later date when there is more in it I will be more interested in switching to a SMSF)

(1) From googling/ reading other material, it sounds like CareSuper is an option - I am looking for an industry fund appropriate for a professional? Can anyone suggest alternatives that are worth considering?

(2) how long do I have to make this decision?

(3) are co-contributions available to permanent resident NZers? ATO comments on temporary visas - I am here permanently? (so right now I think this is a yes?)

(4) should I be considering APRA funds? how to they work? 

NB I am not looking for advice, or 'the answer' and I have attempted to answer these questions myself already. Not afraid to read up more/ deal with jargon etc as I have worked in superannuation in NZ before thus should be relatively easy to figure out.


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## Garpal Gumnut (20 November 2011)

fwiw


1. Avoid industry funds, set up your own self managed super fund, depends on your earnings and size of super contributions, otherwise go with a leader e.g Sunsuper.

2. You have as far as I know and I'm not an accountant until 30th June 2012.

3. Ask an accountant 

4. Ask an accountant

Also there are numerous "advisers ", some of whom are still employed in the financial press who will assist you in setting up your own self managed super fund SMSF. 

gg


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## Lurkin (20 November 2011)

(1) why? it will be starting from scratch with no where near enough in it to cover the cheapest fees I can find? (500 - 600 pa). this is why I am more interested in a managed fund, and I thought CareSuper is a leader?

(2,3,4) I am an accountant.... and I am uninterested in getting an adviser. Literally just looking for the answers to these queries/ interested in what others think.


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## sptrawler (20 November 2011)

Lurkin said:


> (1) why? it will be starting from scratch with no where near enough in it to cover the cheapest fees I can find? (500 - 600 pa). this is why I am more interested in a managed fund, and I thought CareSuper is a leader?
> 
> (2,3,4) I am an accountant.... and I am uninterested in getting an adviser. Literally just looking for the answers to these queries/ interested in what others think.




Check esuper fees, if you decide to start your own fund. I don't use them but people say they are worth checking. By the way no one on the forum can give financial advice. Do your own research.


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## Garpal Gumnut (20 November 2011)

Lurkin said:


> (1) why? it will be starting from scratch with no where near enough in it to cover the cheapest fees I can find? (500 - 600 pa). this is why I am more interested in a managed fund, and I thought CareSuper is a leader?
> 
> (2,3,4) I am an accountant.... and I am uninterested in getting an adviser. Literally just looking for the answers to these queries/ interested in what others think.




If you are an alien, you need an Australian accountant, even if you are an alien accountant.

gg


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## Smurf1976 (20 November 2011)

I'd go with one of the majors for now. You can always open a new account and move your money once you've sorted out exactly what you want.


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## tech/a (20 November 2011)

No matter how well most think they can invest in super the sad fact is that they will need a passive income in retirement to live an existing quality of life.

Inflation and increased cost of living will evaporate and absorb savings for those who survive beyond 10 yrs. of retirement 

So more importantly in my view is setting up a passive income source.


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## Lurkin (20 November 2011)

Is CareSuper considered to be one of the larger Supers? I think I will just go with a industry fund for the time being, and as suggested move to self managed once I have more cash/ know more about them/ more confident with what to do with it to make $$$!


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## Junior (21 November 2011)

The below are my thoughts on these issues, and should not be construed as financial advice.


(1) From googling/ reading other material, it sounds like CareSuper is an option - I am looking for an industry fund appropriate for a professional? Can anyone suggest alternatives that are worth considering?

I see no issue with one of the large industry funds until you get a sufficient balance for SMSF.  Australian Super isn't bad.  Low cost and offers all the features you could desire; plenty of investment options, direct shares, insurances etc.

(2) how long do I have to make this decision?

Your employer will establish a super fund with their preferred provider for you shortly after you commence employment, unless you establish your own account and then provide them with the details.

(3) are co-contributions available to permanent resident NZers? ATO comments on temporary visas - I am here permanently? (so right now I think this is a yes?)

Double check this, but I think you may be eligible for co-cont as an NZ citizen, providing you meet the other criteria.

(4) should I be considering APRA funds? how to they work? 

Don't know much about these...I don't think there's any reason to stray from industry, retail or SMSF.


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## Knobby22 (21 November 2011)

Care Super been really good.
Australian Super has been nearly as good.

You don't have to go the SMSF route and pay advisors, accountants etc. The advantage of an Industry superfund is that you leave it to others and get on with your life.  To me it becomes the conservative stable base of  future retirement funds that you can't get till your quite old.  It  provides investing with a wide spread of the world economy that is difficult to do as an SMSF. Do your other investing outside this where you can take more risks and use the money for making your life better while you are not too old.

I know a couple of people who did SMSF who have blown up their savings and have angry wives. Personally, I don't want the stress.


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## Lantern (21 November 2011)

Latest performance figures.
Hope this helps.


http://images.smh.com.au/file/2011/11/19/2784087/7-year-super.docx


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## waimate01 (21 November 2011)

Knobby22 said:


> Do your other investing outside this where you can take more risks and use the money for making your life better while you are not too old.




I must say I agree with this sentiment. I've never understood why people are in such a headlong rush to go SMSF. 

Control? Do people really think they are such savant investors that they will, untrained and part-time, exceed the performance of full-time professionals? 

Fees? There are plenty of reasonably-priced alternatives.

Freaky stuff?  Having your SMSF invest in a painting which hangs above your fireplace and can enjoy looking at even though you are not yet 55. Having your SMSF invest in a unit your son lives in... all these things seem to be not investment choices.

I agree with Knobby22. Do your investing in addition to super, and let someone else manage your super. That way, if it turns out you are not the investment superman you hope you are, your future is still assured. It's a plan B. Plan A is that your investments outside of super turn out so well that your super becomes insignificant.

Diversification is good, and diversification of investment manager is equally valid.


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## Julia (21 November 2011)

Knobby22 said:


> I know a couple of people who did SMSF who have blown up their savings and have angry wives. Personally, I don't want the stress.



Don't blame the SMSF structure for that!  These people clearly didn't know what they were doing and would have lost money whether investing inside or outside Super.



waimate01 said:


> I must say I agree with this sentiment. I've never understood why people are in such a headlong rush to go SMSF.
> 
> Control? Do people really think they are such savant investors that they will, untrained and part-time, exceed the performance of full-time professionals?



Yes, absolutely.  And most of us do.
I heard a report yesterday that the best of the public super funds' performance over the last five years  has been around 6% and only a few of them achieved that.  

You refer to people with SMSF as untrained.  It doesn't take a degree in finance to understand how to manage money or learn when to be in the market and when to leave it alone.

And yes, the control issue is big.  I don't ever want someone else controlling my funds.  No one has as great an interest in looking after them than I do.
I've had a SMSF for about eight years and am way ahead, despite taking a living from it.

Fees?  I pay around 0.2% of the fund's balance p.a. for tax return and audit and then there's a fee to ASIC of, I think, about $40 or $50.



> Freaky stuff?  Having your SMSF invest in a painting which hangs above your fireplace and can enjoy looking at even though you are not yet 55. Having your SMSF invest in a unit your son lives in... all these things seem to be not investment choices.



I don't do anything like this, but can't see why it's not a good idea.  If either the painting or the unit has the potential to offer capital growth and the unit in the meantime is deriving income, what's the problem if the law allows it?

Remember that "Super" is simply a tax advantaged vehicle for investments, not an investment of itself.  If you have sufficient skill to make money outside of such a vehicle where you're likely paying the top tax rate, surely it makes sense, unless you're very young, to do that investing where the tax is only 15%.

Don't depend on "the professionals" to always act in your best interests.  Learn how to do it well yourself.


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## tech/a (21 November 2011)

waimate01 said:


> I must say I agree with this sentiment. I've never understood why people are in such a headlong rush to go SMSF.
> 
> Control? Do people really think they are such savant investors that they will, untrained and part-time, exceed the performance of full-time professionals?
> 
> ...




SMSF

Best thing I ever did.
Hold Business Property and Pay myself rent.
Massive benifits particularly initially when we could place $ 100 k each a year.
The tax advantages far outweigh investment outside of Super.
Sure have them but dont under estimate SMSF particularly in the hands of experts---If your in a position like myself.
Did and still do through our accountant.


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## robz7777 (21 November 2011)

waimate01 said:


> Freaky stuff?  Having your SMSF invest in a painting which hangs above your fireplace and can enjoy looking at even though you are not yet 55. Having your SMSF invest in a unit your son lives in... all these things seem to be not investment choices.




Pretty sure these are breaches of the SIS act.. If they were audited the accountant (if any) would be in some trouble as the members would lose their tax concessions..


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## Julia (21 November 2011)

robz7777 said:


> Pretty sure these are breaches of the SIS act.. If they were audited the accountant (if any) would be in some trouble as the members would lose their tax concessions..



 I'm not sure about the issue of the relative living in the investment property, but the SMSF can certainly invest in property.
Ditto Art/Collectibles, within certain conditions.
http://www.thesmsfreview.com.au/i-collectables.html


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## matty77 (21 November 2011)

I am with Australian Super and they have been pretty good.

Their fees can be quiet high though, and they look considerably higher when you lose money and they still sting you - however I am now 100% in cash for my super at the moment until GFC2 has finished.


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## Lurkin (21 November 2011)

Hi all,

Thanks for the replies, great to have your input.

In the short run I have decided to go with CareSuper. Its quick, relatively cheap, doesnt require active management and doesnt require capital start up to justify it.

I will definitely be interested in SMSF in the future, however as I understand the benefits of it - just dont have time to sort it at the mo (I have just moved countries!)

Julia, thank you for posting, was kinda hoping you would as I have been reading some of the other posts and I am very interested to know more about how you have achieved the low cost SMSF - it would be great if you could let me know more about this, feel free to PM if it would be more appropriate.

*For the record _I have a finance degree_ with postgraduate study in Accounting ->  I am not doing this through ignorance/ lacking in investment skill (I have other investments in NZ that are not managed funds), but I would like to know more about investing in Australia and the different options available here before taking the SMSF leap.


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## So_Cynical (21 November 2011)

Knobby22 said:


> Care Super been really good.
> *Australian Super* has been nearly as good.






matty77 said:


> I am with *Australian Super* and they have been pretty good.




On the 28th of This month AustSuper will launch there new Member Direct investment option, allowing members the option of direct investment into the ASX300 and the full range of IShare ETFs, this is a whole new platform featuring daily trade settlement and an interest paying trade settlement account.

Many of the features of a SMSF but without the extreme costs and paperwork.

Read on http://www.australiansuper.com/memberdirectguide


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## Lurkin (21 November 2011)

CareSuper already has something similar, but I think its limited to 50%.

Again, they have mentioned a threshold of 10k odd before considering it - as there is still brokerage fees to consider... which are on top of administration fees.. 

not really there yet  - I think I will be more interested in a strong self management scheme in 12 months or so, to allow time to research (and talking to others in the firm, probably the best source!).


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## Julia (21 November 2011)

Lurkin said:


> I will definitely be interested in SMSF in the future, however as I understand the benefits of it - just dont have time to sort it at the mo (I have just moved countries!)



Moving countries is a considerable challenge.  Sensible of you to not engage in other substantial changes until you feel quite settled.



> Julia, thank you for posting, was kinda hoping you would as I have been reading some of the other posts and I am very interested to know more about how you have achieved the low cost SMSF - it would be great if you could let me know more about this, feel free to PM if it would be more appropriate.



Very happy to help where possible, Lurkin.  Will PM you.



So_Cynical said:


> Many of the features of a SMSF but without the extreme costs and paperwork.



Extreme costs???  Since quoting above annual costs of around 0.2% p.a. I think it's more like 0.1%.  Do you consider this an 'extreme cost"?  

The paperwork is nothing like as arduous as is suggested by those who have an interest in deterring people from having SMSFs.  You need to have a properly constructed Trust Deed when doing the set up and then a simple Investment Strategy which needs to say little more than that the Investment Strategy will be designed to provide members with benefits in their retirement and will be appropriately adjusted according to market conditions.  
You do not need to produce some multi-page piece of fancy prose.

Apart from that, you just keep the same records as you would for any investment outside of Super.  Hardly a problem, surely?


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## So_Cynical (21 November 2011)

Julia said:


> Extreme costs???  Since quoting above annual costs of around 0.2% p.a. I think it's more like 0.1%.  Do you consider this an 'extreme cost"?
> 
> The paperwork is nothing like as arduous as is suggested by those who have an interest in deterring people from having SMSFs.  You need to have a properly constructed Trust Deed when doing the set up and then a simple Investment Strategy which needs to say little more than that the Investment Strategy will be designed to provide members with benefits in their retirement and will be appropriately adjusted according to market conditions.
> You do not need to produce some multi-page piece of fancy prose.
> ...




Extreme as in i think from memory you pay about 1500 or 2K annually..in AustSuper with 8 trades per year ill pay less than $700 in total and have absolutely no paperwork.

Its a bit of a mandarin and oranges comparison...both citrus fruits and the same colour yet not the same things....but many SMSF people don't hold real estate and don't want to do anything super fancy, many just want a bit of creative freedom.


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## nulla nulla (22 November 2011)

So_Cynical said:


> Extreme as in i think from memory you pay about 1500 or 2K annually..in AustSuper with 8 trades per year ill pay less than $700 in total and have absolutely no paperwork.
> 
> Its a bit of a mandarin and oranges comparison...both citrus fruits and the same colour yet not the same things....but many SMSF people don't hold real estate and don't want to do anything super fancy, many just want a bit of creative freedom.




If you only make 8 trades or less each year in your SMSF then $1500 pa would be excessive (money for jam for the accountant) and $700 pa to meet the statutory requirements would be more realistic.

Paying an accountant a percentage of the portfolio you effectively control and manage the paper work of is in my opinion also excessive. Paying the accountant a realistic hourly rate that reflects the time they actually put in lodging the tax return and doing the statutory audit (of the well maintained records you prepare) is far more reasonable.


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## matty77 (22 November 2011)

So_Cynical said:


> On the 28th of This month AustSuper will launch there new Member Direct investment option, allowing members the option of direct investment into the ASX300 and the full range of IShare ETFs, this is a whole new platform featuring daily trade settlement and an interest paying trade settlement account.
> 
> Many of the features of a SMSF but without the extreme costs and paperwork.
> 
> Read on http://www.australiansuper.com/memberdirectguide




Yup I know about that, also read your other posts on the topic - very interesting but not for me. I do not contribute anything extra to super - rather I am investing my own money into shares etc directly as I prefer to have a bit more control on when to buy and sell.


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## Julia (22 November 2011)

nulla nulla said:


> If you only make 8 trades or less each year in your SMSF then $1500 pa would be excessive (money for jam for the accountant) and $700 pa to meet the statutory requirements would be more realistic.
> 
> Paying an accountant a percentage of the portfolio you effectively control and manage the paper work of is in my opinion also excessive. Paying the accountant a realistic hourly rate that reflects the time they actually put in lodging the tax return and doing the statutory audit (of the well maintained records you prepare) is far more reasonable.



You should not assume that because I expressed what I pay as a % of the value of the fund, the accounting charge is formulated on that basis.  It is absolutely on an hourly basis, the work involved, and changes e.g. according to the volume of trades.

You also need to remember that SMSF's are required to be audited by someone other than the accountant who prepared the tax return, so the return is sent out to a separate auditor, whose fee is usually around $500 or $600.

What I pay also includes any and all communications and advice from my accountant as I may ask for during the year.  Don't underestimate the value involved here.
Many accountants will charge separately, around $60, for any email or phone call.

You can easily pay up to $5000 for a SMSF tax return and audit at some of the big firms.


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## Julia (22 November 2011)

nulla nulla said:


> If you only make 8 trades or less each year in your SMSF then $1500 pa would be excessive (money for jam for the accountant)



Have you ever actually seen a SMSF's prepared financial statements, minutes, etc involved in the tax return?  The audit papers?  The ATO set down what imo are very demanding criteria about how the actual figures must be presented.  It is not remotely like your ordinary tax return.


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## Julia (22 November 2011)

So_Cynical said:


> Extreme as in i think from memory you pay about 1500 or 2K annually..in AustSuper with 8 trades per year ill pay less than $700 in total and have absolutely no paperwork.
> .




OK, but what does that $700 represent in terms of a % of your invested capital???
For that to represent 0.1% of your investment (if you're going to compare what you pay and what I pay) then you'd have $700,000 invested.  If you have even that much, I wouldn't be giving it to some one else to manage.

How does AustSuper calculate its charges?  Is it a flat fee because you are restricted to X number of trades etc?


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## So_Cynical (22 November 2011)

matty77 said:


> Yup I know about that, also read your other posts on the topic - very interesting but not for me. I do not contribute anything extra to super - rather I am investing my own money into shares etc directly as *I prefer to have a bit more control on when to buy and sel*l.




matty...things are changing at AustSuper, its a whole* new* platform where your get to set your own buy and sell price, you can do dividend reinvestment, hell you can even pay a little extra and get live data, its a whole new platform.

Order screen shot below.
~


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## So_Cynical (22 November 2011)

Julia said:


> OK, but what does that $700 represent in terms of a % of your invested capital???




I have 50K in super so its about 1.75% and if i had 150K it would be around 0.6% because i would still be paying about $700



Julia said:


> For that to represent 0.1% of your investment (if you're going to compare what you pay and what I pay) then you'd have $700,000 invested.  If you have even that much, I wouldn't be giving it to some one else to manage.




Partly True...in that i would be managing most of it via AustSuper as i am now, i switched to Aust Super because i do get to manage it.



Julia said:


> How does AustSuper calculate its charges?  Is it a flat fee because you are restricted to X number of trades etc?




Flat fees and charges per trade 15 to 25 dollars a trade depending on size.


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## Lurkin (22 November 2011)

The way I thought of the fees was this:

Fixed costs appear low if they are spread over many units
Meanwhile, variable costs remain the same, regardless of the number of units.

Ergo, if it is spread over a large amount of super i.e. 70k, then 700pa is 1%
alternatively over a small amount $7 = 10,000% 

the same can be said about trading costs.

theres returns etc to consider as well.. blah blah.

i think the point is that whilst the different providers have their arbitrary limits, there is  definitely going to be a cross over point, where the fees of SMSF/ self managed style of superannuation is more cost effective than going through a fund provider.

I've been making a spreadsheet in spare time during they day, to fully represent all the fees (monthly, managerial, performance - the works), contributions, returns (based on 5 year historical rates blah blah I know this is not an indicator etc) to get an idea of how it will work.

Once I'm happy that it is a fair representation, I will move on to a comparison with doing the same with SMSF.

Where the amount is greater for SMSF - it will cross over the two = boom! time to shift to SMSF. (this is my own perspective on my own finances and is not suggestive of financial advice for anyone else. Like all of my posts in this forum it is not financial advice, use this idea at your own risk).

Frankly I expect it to be outside of 5 years, and will be heavily dependent on the return assumptions - I guess I will base this off a relevant index/indexes to get an idea.. will get to it eventually.


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## Julia (22 November 2011)

So_Cynical said:


> I have 50K in super so its about 1.75% and if i had 150K it would be around 0.6% because i would still be paying about $700



It's actually a bit less than 1.75%.  i.e. 1.75% on $50K would be $875.

With  $50K obviously you wouldn't even consider a SMSF.  The so called experts suggest you need a minimum of $200K for it to be cost effective.  I agree.



> Flat fees and charges per trade 15 to 25 dollars a trade depending on size.



So the charges per trade are in addition to your $700 basic fee?  Therefore if you did a couple of hundred trades per annum you'd be up for a lot more?  i.e. if you did 200 trades at, say, $20 per trade,  you'd be up for an additional $4000!!!

Makes my accountant look pretty cheap!


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## Ves (22 November 2011)

Respectfully Julia, if you were completing 200 trades in an SMSF you'd be paying $20 a pop to the broker alone. This is around $4k. Much the same as the within the managed super wrap that is being discussed here.

The accountant would be charging you an additional amount, and on such a volumnious trading history most accountants would charge you at least $6-7k from experience. I've seen as much as $10-12k on the bigger funds who trade heavily. 

My firm has a different fee structure to most public practice firms. We charge a base fee, add a surcharge per each member in the fund (more for pension members), then bill in blocks of transactions. Any additional advice, pension commencements outside of this is charged separately. With a fund that has completed 200 trades, and has say, 20-25 additional bank transactions on top of this the total fee would be $5,500 if there were two accumulation members. Thats $9,500 per year if you include the brokerage at $20 per trade. Probably a lot more generous than a lot of other firms too. These are the sorts of funds that are very time-consuming, and more often than not, actual time is written off as unrecoverable.

As a fund accountant myself, there is nothing worse than spending a whole day entering all of the data, then having to sort through all of the capital gains reports to ensure that everything is accurate. Unfortunately the SMSF audit requirements generally mean that there is no "immateriality" to fall back on should you enter something incorrectly. It's even more frustrating when the "trader" has made a tiny profit, or even a loss. All that work for nothing!

Despite being limited to the ASX 300 this new platform looks fairly cost effective for those who do not have the funds to set up an SMSF.


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## Julia (22 November 2011)

Ves said:


> Respectfully Julia, if you were completing 200 trades in an SMSF you'd be paying $20 a pop to the broker alone.



Equally respectfully, that's a good point.  However, if I were doing 200 trades p.a. I  wouldn't be paying $20 each for them!


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## sptrawler (23 November 2011)

I run an SMSF with accounting software. This enables the lay person to input their own data, the software does all the accounting.
Then zip it up email it to the auditor and Bob's your uncle.


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## nulla nulla (23 November 2011)

Julia said:


> You should not assume that because I expressed what I pay as a % of the value of the fund, the accounting charge is formulated on that basis.  It is absolutely on an hourly basis, the work involved, and changes e.g. according to the volume of trades.
> 
> You also need to remember that SMSF's are required to be audited by someone other than the accountant who prepared the tax return, so the return is sent out to a separate auditor, whose fee is usually around $500 or $600.
> 
> ...




In the first instance, nothing I have posted is directed at you. However, I should correct my comment that 0.1% - 0.2% is excessive, it is probably cheap, too cheap for a portfolio worth less than $1,000,000.00. (1% - 2% would be excessive).

If there was less than $1,000,000.00 in the portfolio at 0.1% to 0.2% the accountant would received $1,000.00 to $2,000.00 maximum. It is questionable whether this would adequately address; the time spent in complying with the statutory requirements; as well as the additional time spent through the year discussing aspects of superanuation legislation and any changes to the maintenance of records and preparation of paperwork for them to do the returns and facilitate the audit. 

I am happy pay a reasonable hourly rate.



Julia said:


> Have you ever actually seen a SMSF's prepared financial statements, minutes, etc involved in the tax return?  The audit papers?  The ATO set down what imo are very demanding criteria about how the actual figures must be presented.  It is not remotely like your ordinary tax return.




Yes, I have. We liaise closely with our accountant (and his staff) and have been advised what is required from us by way of minutes of meetings, SMSF transaction records and objectives of the fund for us to be incompliance. 



Julia said:


> Equally respectfully, that's a good point.  However, if I were doing 200 trades p.a. I  wouldn't be paying $20 each for them!




Perhaps brokerage costs per transaction are relative to the size of the trade?


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## Julia (23 November 2011)

nulla nulla said:


> Perhaps brokerage costs per transaction are relative to the size of the trade?




Yes, of course, but with volume comes discounted rate.


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## Julia (23 November 2011)

sptrawler said:


> I run an SMSF with accounting software. This enables the lay person to input their own data, the software does all the accounting.
> Then zip it up email it to the auditor and Bob's your uncle.



And that, I expect is what many people do, not just the accountants.  Hence no reason for them to charge exorbitant fees.

  It's a great idea.  Is it pretty straightforward to use, sp?


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## sptrawler (23 November 2011)

Julia said:


> And that, I expect is what many people do, not just the accountants.  Hence no reason for them to charge exorbitant fees.
> 
> It's a great idea.  Is it pretty straightforward to use, sp?




We started using the software because we felt it gave us some control over our fund.
The first year of running the fund, approx 5 years ago, I made up some excell spreadsheets to show the funds transactions and financial statements. Well that idea was blown out of the water when we tried to get it audited, they wouldn't look at it unless it was presented in standard accounting format.
This left us with the choice of handing the accounting over and hoping that they don't rip us off, or buying some software and inputting the data ourselves. At least that way we would know exactly what is happening.
Sorry about the long winded reply now for the answer. Is it straight forward to use? If you have some accounting knowledge it would be simple to use, unfortunately we don't fall into that categorie.
We did a 4hr traing course that the company conducts around the country, they supplied a very good reference manual, that we still refer to. 
We only sit down and enter all the info once a year so we are usually rusty, but don't have too many problems inputting the data. If we used it more often it would make it easier I'm sure. However we are wrapped in it and find it great to have all your info, member statements, funds financial statements etc at the push of a button. Also there is a piece of mind in knowing that I am not relying on someone else to tell me how much money I have.


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## matty77 (23 November 2011)

I only do probably 10 trades a year, so not that many.

Plus I don't want to put my money into something that I can only access in another 35 years time (I'm only 34), hell I might want to sell up and travel overseas next year or the year after, who knows. But I like to have that flexibility.


How does a bank perceive you holding shares like that in your super if you were applying for a home loan, would they look at it as asset or not? I doubt they would.


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## Julia (23 November 2011)

sptrawler said:


> We started using the software because we felt it gave us some control over our fund.
> The first year of running the fund, approx 5 years ago, I made up some excell spreadsheets to show the funds transactions and financial statements. Well that idea was blown out of the water when we tried to get it audited, they wouldn't look at it unless it was presented in standard accounting format.
> This left us with the choice of handing the accounting over and hoping that they don't rip us off, or buying some software and inputting the data ourselves. At least that way we would know exactly what is happening.
> Sorry about the long winded reply now for the answer. Is it straight forward to use? If you have some accounting knowledge it would be simple to use, unfortunately we don't fall into that categorie.
> ...



Many thanks for helpful reply, sp.  



matty77 said:


> I only do probably 10 trades a year, so not that many.
> 
> Plus I don't want to put my money into something that I can only access in another 35 years time (I'm only 34), hell I might want to sell up and travel overseas next year or the year after, who knows. But I like to have that flexibility.



This is the totally logical reason a lot of people don't want to put too much into Super when retirement is so far away.  I agree with you.  Better to pay a bit more tax for now.



> How does a bank perceive you holding shares like that in your super if you were applying for a home loan, would they look at it as asset or not? I doubt they would.



Don't know, but it's an interesting question.  If, say, you wanted to borrow about a third of the value of your super, what would the banks' view be?  Someone will know.


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## waimate01 (23 November 2011)

Julia said:


> Don't know, but it's an interesting question.  If, say, you wanted to borrow about a third of the value of your super, what would the banks' view be?  Someone will know.




Well, if you die your super is not covered by your will, because your super doesn't belong to you - it's merely held in trust for you. You have no control over it, and hence cannot direct what happens to it as part of a will. On that basis, I would imagine the bank would say your super cannot function as collateral, because you (as the member) do not have control over it (you cannot sign it over to the bank). And you, as the trustee, do not have unfettered right to it either. Your super assets are in a locked box. You can't just help yourself to it, and neither can the bank.


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## Julia (23 November 2011)

waimate01 said:


> Well, if you die your super is not covered by your will, because your super doesn't belong to you - it's merely held in trust for you. You have no control over it, and hence cannot direct what happens to it as part of a will. On that basis, I would imagine the bank would say your super cannot function as collateral, because you (as the member) do not have control over it (you cannot sign it over to the bank). And you, as the trustee, do not have unfettered right to it either. Your super assets are in a locked box. You can't just help yourself to it, and neither can the bank.



That makes sense.  However, I recently made a new Will and went into this in detail with the lawyer.  Have been assured that the beneficiary will receive the proceeds of the SMSF along with the other assets.  Can't now remember the details but I think it was along the lines of the executor assuming the role of Trustee.  Could be wrong here.  I won't actually care, will I!


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## DavidDeegan (27 December 2011)

I have only just joined this forum and came across this post, I see you've already decided on Care Super, so for what its worth thought I would add the following re your questions 3 and 4:



Lurkin said:


> (3) are co-contributions available to permanent resident NZers? ATO comments on temporary visas - I am here permanently? (so right now I think this is a yes?)




Not sure if you have come across this link on the ATO website in your research:

http://www.ato.gov.au/individuals/content.aspx?menuid=0&doc=/content/42616.htm&page=2&H2

So according to the ATO website, they mention no issues, but to clarify your situation you can also call the ATO on their superannuation info line on 13 10 20.

Keep in mind though the other eligibility criteria as well, also outlined on the above link, including income thresholds.

In 2011-12 financial year the maximum entitlement is $1,000 if you earn less than $31,920 and this phases out completely if you earn above $61,920.

From 2012-13 the maximum entitlement is $500 if you earn less than $31,920 and this phases out completely if you earn above $61,920.

http://www.ato.gov.au/businesses/PrintFriendly.aspx?ms=businesses&doc=/content/00200258.htm

(see sub heading Super co-contribution about 3/4 down the page)



Lurkin said:


> (4) should I be considering APRA funds? how to they work?




Probably not a consideration given you mention a low initial starting balance and concerns regarding fees.  According to a report from APRA (http://www.apra.gov.au/AboutAPRA/Research/Documents/Cost-Performance-and-Portfolio-composition-of-small-APRA-funds.pdf) the average member balance is over $300,000 and the average asset weighted fees are 1.8% pa.

A small APRA fund is regulated by APRA rather than the ATO (for SMSF) and appoint an approved trustee (where with a SMSF the members are trustees or directors of the coporate trustee of the SMSF).


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