The concept of SMSFs for all is “dangerous”, the SMSF Academy’s Aaron Dunn has said in response to CleverSuper’s offer of a “free SMSF to every Australian”.
SMSFs are not generally appropriate in a mass environment, Mr Dunn told SMSF Adviser, since there is a required a level of financial literacy that does not necessarily suit some investors.
“If it goes too far into mainstream, it will then present issues that [the Australian Securities and Investments Commission is] concerned with at the moment ... the fact that people don’t have potentially the financial competencies to be able to make the right decision,” Mr Dunn said.
“They’ll get pushed down a path where they’ll be investing in products that may expose them to risk.”
Mr Dunn said growth in the sector should be coming from engagement with the industry from those genuinely interested in and appropriately using the SMSF vehicle.
“It comes back to making sure that people are moving into it for the right reason, not because the product is there... as the carrot to get them to do it,” Mr Dunn said.
“[This] is why the whole borrowing in property piece is starting to cause a bit of friction because we’re seeing the product providers come in first, using the SMSF as the solution to sell the product.”
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