Inadequate SMSF asset allocation raises concerns

SMSFs SPAA research and ratings smsf professionals retirement chief executive trustee

14 February 2013
| By Staff |
image
image
expand image

Research released at the SMSF Professionals' Association of Australia (SPAA) conference has raised concerns that more than half of self-managed super fund trustees are not altering their asset allocations to a more defensive position as they move into retirement.

Chief executive of Russell Investments in the Asia Pacific, Alan Schoenheimer, revealed that only 43 per cent of trustees indicated that they were changing their asset allocation in retirement or planning to do so, according to the Russell/ Coredata research.

That was an inadequate number of people preparing for the flow into and through retirement, Schoenheimer said.

Currently, trustees can receive tax-free income when they move into retirement, and that alone should give cause to think about whether the asset allocations in the fund should change, he said.

Contributions coming into the fund are also going to be dramatically curtailed during these years, he said.

Trustees need to be nudged along and made to consider alternative asset allocations as they near retirement, and this would give advisers the opportunity to demonstrate value-add, especially with such a big change in trustee's situation, Schoenheimer added.

The strong preference for domestic equities and cash would lead to under-diversified portfolios in the long run, he warned.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

This verdict highlights something deeply wrong and rotten at the heart of the FSCP. We are witnessing a heavy-handed, op...

1 day 10 hours ago

Interesting. Would be good to know the details of the StrategyOne deal....

5 days 16 hours ago

It’s astonishing to see the FAAA now pushing for more advisers by courting "career changers" and international recruits,...

3 weeks 3 days ago

Insignia Financial has made four appointments, including three who have joined from TAL, to lead strategy and innovation in its retirement solutions for the MLC brand....

2 weeks 5 days ago

A former Brisbane financial adviser has been charged with 26 counts of dishonest conduct regarding a failure to disclose he would receive substantial commission payments ...

4 days 14 hours ago

Pinnacle Investment Management has announced it will acquire strategic interests in two international fund managers for $142 million....

3 days 17 hours ago