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SMSFs seen as ‘fashion accessory’: NGS Super
NGS Super’s chief executive has outlined the industry fund’s plans to launch tools to assist individuals assess their suitability as an SMSF trustee, saying those who regard SMSFs as a “fashion accessory” may not have considered the associated risks.
Speaking to SMSF Adviser, NGS Super's chief executive, Anthony Rodwell-Ball, said an SMSF is a good solution for those who understand trustee responsibilities and want control of their fund.
“It’s the individuals who regard the SMSF as the desirable fashion accessory, something you talk about at barbeques… those are the sorts of people that one really questions the motivation and the reason for it,” Mr Rodwell-Ball said.
“They don’t often, unfortunately, appear to have thought through the risks and responsibilities.”
Mr Rodwell-Ball said NGS Super is developing tools to assist individuals assess whether they’ve got the time, interest and technical expertise to be an SMSF trustee. The facility will be available via the NGS Super website later in the year, he said.
“If you tick all the boxes and you answer them affirmatively and you really want to proceed, well that’s good. If you don’t tick all the boxes, well then start thinking a bit more seriously about it,” he said.
“Why would I apply for a job as an SMSF trustee if I didn’t know a single thing about investing? That’s what we’re trying to get across,” he added.
Can the media stop printing this dribble from the industry funds. Constantly peeved risk insurance adviser to SMSF funds. Yes I do have the fashion accessory myself. I take it to BBQ's as well.0- Why would you want to lose money constantly from the big end of the super industry. The fashion accessory tag seems to be sponsored by the large funds to scare intelligent individuals from controlling their super at a quarter of the price.0
- I administer plenty of superfunds and I know of none who worry about their duties as trustees. We take care of all the accounting tax and other compliance work. I advise on investments and monitor them continuously. The only thing the clients do is bank the cheques and pay the bills. Even these jobs are minimal with direct credits and debits
I agree that SMSFs are not for everyone but we sort out this matter before setting up a fund.
Even the most financially unaware of our superfund clients have no problems dealing with the small amount of work that they do.
It seems that there are many who are interested in their own interests than those of their clients0 - I believe part of the reason so many people are less capable of managing their financial affairs, is the tradional reticence regarding discussions of personal money. However, I go to any city coffee shop or bar and listen to professional money takers boasting of their strategies with other peoples money. Enlightening. The CEOs might not talk in public, but most of their staff from direct reports downwards do.
Where else apart from social gatherings can most people get their financial ideas guys? Wouldnt you in the financial planning business like to know if and how your clients are touting your names and skills at such BBQs ?0 - Do the people this bloke is talking about even exist?0
- This is truly ridiculous. Who in their right mind would take the advice of an automated test from NGS Super about whether they should set up a SMSF?
Perhaps SMSF Adviser could publish a test for industry fund board members?0 - Is this just not a little insulting ?
My interpretation of this article is that the general public is so incapable of making financial decisions on their own, their motivation must stem from the desire to increase their social standing. It couldn't possibly be anything else....0 - Its actually good if industry players are providing tools to help people self assess - though I don't think the people who view it this way will take any notice.
Deciding on an SMSF purely for cost reasons, or even basic investment flexibility, is too simplistic but SMSF's do have a range of other benefits which often people - including many advisers selling SMSF's - are unaware of.
What gets lost - and to their credit both the reporter and Mr Rodwell-Ball allude to - is that SMSF's are a bit like a puppy, fun at first but then to use properly require a bit of work. Its all well and good to superficially compare fees of "approx 1% versus a fee of approx 0.4%" but there is actually work for the trustee in running the SMSF and looking after the investments - too often this gets ignored.
Unlikely, but it would be great to get some true balance into the discussion about industry v retail v SMSF.0 - I have yet to hear anyone talk about SMSf at a bbq. So maybe it is all the CEO's of Industry funds who see SMSF's as a fashion accessory. Which is fine by me as all of my clients with SMSF's have at least 5 or more quite significant reasons to have them. And none discuss their financial affairs at BBQs0
- Can the reporter ask Mr Rodwell-Ball what the average balance is in NGS & how does that compare to the average balance in SMSFs?
Can the reporter then ask a follow-up question about what the differential says about the average SMSF trustee & their financial capabilities?
Finally could the journalist ask Mr Rodwell-Ball if he had $1M to invest and the two options were to be charged a fee of approx 1% versus a fee of approx 0.4%, which option should the sophisticated investor make in they are a) 100% cash investor or b) 100% high growth investor?
PS Dear journalists - please get some balance in these stories by asking for some facts to support statements being made.
Absolutely agree with Adrian Raftery here.0
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