subscribe to our newsletter
Cost of six members on par with second SMSF, says tech expert

Cost of six members on par with second SMSF, says tech expert

Money, cash
Miranda Brownlee
25 May 2018

For SMSFs considering six members in their fund, one technical expert has highlighted that running two SMSFs may be comparable in cost to running six different segregated investment portfolios. 

Cooper Partners head of SMSF and succession Jemma Sanderson said that while extending the member limit certainly has its merits where families have got more than two children and they want to include their children in their fund to help kick-start their superannuation, running segregated investment portfolios for six different members could result in a lot of additional work for SMSF firms.

“If you’re running separate segregated investment portfolios for six people in a fund, then that can become administratively quite cumbersome to manage, and so the cost of running that versus having two separate funds is six of one and half a dozen of the other,” said Ms Sanderson.

Ms Sanderson also stressed that the trustee structure of the fund is critical when looking at the number of members in a SMSF, with the administration of the fund much simpler with a corporate trustee structure.

“Having six individual trustees is a nightmare. Super funds shouldn’t have individual trustees in my view. They need to have a corporate trustee and that just makes things so much easier from an ongoing administration perspective,” Ms Sanderson said.

“If you had six individual trustees in there, which I hope no one would recommend, one of them passes away or someone wants to leave the fund, you’0ve got to update all the asset registrations.”

Cost of six members on par with second SMSF, says tech expert
smsfadviser logo
join the discussion

Do your clients plan to add additional members to their SMSF if the new six member limit is passed as law?

SUBSCRIBE TO THE
SMSF ADVISER BULLETIN

Get the latest news and opinions delivered to your inbox each morning

In this month's issue:

  • Time wrap
  • The tech bull run
  • From hobby to passion
  • Golden Years
  • An untimely reminder
  • Why change is so difficult
  • Key Strategies for equalising super