Equity in superannuation debate promotes SMSF benefits
Recent questions around superannuation funds' exposure to equities have promoted the benefits of self-managed super funds (SMSFs) in delivering flexibility, according to the Self-Managed Super Fund Professionals' Association (SPAA).
SPAA chief executive Andrea Slattery pointed to a report by Rice Warner Actuaries showing SMSFs outperformed broader superannuation vehicles, adding it was of crucial importance for investors to be able to actively manage their retirement savings.
"There is 'no one size fits all' when it comes to saving for retirement, so it is important that individuals have the flexibility to work out the optimal weighting for their portfolio, and a SMSF is the only vehicle which gives the investor the autonomy and flexibility to decide when and how to adjust their asset allocations," Slattery said.
Recent research by SPAA and Russell Investments found that one third of SMSF trustees believed equities were too volatile - double the number from 2011.
"The investment behaviour of individuals tends to change as they approach retirement and become more concerned about wealth preservation and seek more liquidity in their asset holdings," she said. "With an SMSF, as a trustee you have the choice of how you structure your asset allocation based on your personal circumstances and the retirement stage you are in."
Slattery's comments followed a recent report by Multiport which found allocation to cash in SMSFs is at its highest levels in two years, while allocation to Australian shares has shrunk for the fourth consecutive quarter.
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