SMSFs a risky game
An increasing number of investors are not getting enough information and advice on self-managed superannuation funds (SMSFs) and are suffering as a result, according to Wealth Within executive director Dale Gillham.
Gillham expressed his concern after dealing with a number of clients who, as trustees of SMSFs, were at risk of losing up to half of their savings to fees and fines.
“I’ve come across some people who shouldn’t have had a SMSF in my book, because they just don’t know what they’re doing and to me that’s scary,” Gillham said.
“The romance of having your own SMSF is great, but the majority that have them need help from their financial advisers, and I think many advisers need to start working on how they can service these people better rather than stick to the old model, which is phasing out,” he added.
Gillham noted investors are generally unhappy with the industry’s performance and tend to “take their money, put it in a SMSF and try the share market out themselves”.
A lot of financial advisers are ignoring the needs of SMSF trustees, who turn to cash investments as a result, Gillham said.
His statement is supported by the recently published report by Investment Trends market research, which found a lack of confidence in financial institutions had pushed clients towards direct investments.
Gillham advised investors needed to educate and inform themselves before opening a SMSF to prevent damage to their retirement savings.
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