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.
Superannuation Panic
- Thread starter Lurkin
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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.
Julia
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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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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:
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)
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).
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)
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).
