Boost Your Retirement Planning with SMSF

Are you at that stage in life where you start to think seriously about your retirement? Do you feel like your super could be working harder for you? It’s a common feeling, and you’re not alone. The good news is that with a Self-Managed Super Fund (SMSF), you have a powerful, hands-on way to take better control of your retirement savings.The data speaks for itself. Recent research shows that SMSFs have, on average, outperformed APRA-regulated funds over the past two years. This highlights the strong investment performance that a hands-on approach can deliver. Unlike a regular APRA-regulated fund, where your money is managed by a big commercial institution, setting up an SMSF puts you in charge. As an SMSF trustee, you have the power to make key investment decisions that can dramatically boost your balance and get you closer to the retirement lifestyle you’ve always wanted.Just a quick note: this blog post is a high-level overview to show you what’s possible. We always recommend getting expert financial advice to ensure an SMSF is the right fit for your unique situation. Feel free to reach out to us here at SMSF Loan Experts.

The Power of Control and Investment Freedom

When you become an SMSF trustee, you’re not just a member of a super fund. You also get to be in the driver’s seat of your financial future. This responsibility comes with huge advantages, especially when it comes to how your money is invested.

With an SMSF, you can go beyond the basics of a typical super fund. You can access a wider range of investment options, such as direct residential or commercial property,

unlisted shares, and other assets that aren’t typically offered by a standard fund. This freedom allows you to create a more tailored retirement financial planning strategy that aligns with your personal knowledge, experience, and risk tolerance. You can build a portfolio that you clearly understand and believe in, rather than just choosing from a pre-packaged option.

Even if you’re setting up a single-member SMSF, you still get this incredible level of control. While you’ll need to have a corporate trustee structure (which is highly recommended for all SMSFs anyway), you remain the sole member and the ultimate decision-maker. This is the perfect structure for those who want complete control over their investments.

The SMSF Transition to Retirement (TTR) Strategy

One of the most powerful tools in an SMSF is the SMSF transition to retirement (TTR) strategy. It’s a key benefit that enables you to start an income stream from your super while you are still working, so you can ease into retirement on your own terms.

Here’s how it works: once you reach your preservation age (which is currently 60), a TTR strategy allows you to reduce your work hours and supplement your income with tax-free or low-tax payments from your SMSF. This is a smart retirement planning strategy, especially if you want to slow down without a major drop in your lifestyle.

And here’s a pro-tip for your retirement planning investing: you can use the TTR payments to top up your income while making additional concessional contributions to your SMSF from your salary. Doing so is a powerful way to continue building your super balance while potentially reducing your income tax. It’s definitely a win-win!

Moving into the Super Retirement Phase

The ultimate goal of all this planning is to get to the super retirement phase. This is the big payoff, and an SMSF makes the transition seamless and incredibly tax-efficient.

When you meet a condition of release (like retiring or turning 65) and decide to start a pension, your SMSF can easily shift from the accumulation phase to the retirement phase. The assets in your SMSF that support your pension then become tax-free. That’s right—tax-free! The investment earnings on those assets are no longer taxed, which can supercharge your remaining years of retirement and help your money last longer.

Recent data from the Class Annual Benchmark Report shows that a majority of SMSF members over 65 have already established a tax-exempt income stream compared to those APRA-regulated fund members. This stark difference highlights the level of engagement and focus on outcomes that SMSF members have.

With an SMSF, you can also pick the timing and the specific assets that support your tax-free income stream, giving you a level of confidence and control that’s hard to beat.

Take Better Control of Your Retirement Planning

Planning for retirement is one of the most important financial steps you’ll ever take. An SMSF offers a unique and powerful tool to take charge of that plan. It gives you the control and flexibility to invest your way, the ability to ease into retirement with a TTR strategy, and the significant tax benefits of the retirement phase.

At SMSF Loan Experts, we’re here to help you explore how SMSF lending can be a part of your overall retirement planning. Whether you’re considering buying a rental property or a commercial asset for your fund, we can guide you through the process and help you get a head start on building your retirement wealth. Let’s talk about how you can leverage your super to create the retirement you deserve. Give us a call to speak to one of our SMSF loan specialists today.