Younger SMSF trustees entering investment market
The age of SMSF investors is continuing to decline as younger members take a more active role in managing their portfolios, says a product specialist.
Ciara Conway, SMSF product specialist at Stake Super, told SMSF Adviser that Stake Super sign-ups were up 44 per cent in January, with the average Stake Super customer aged 42 compared to 61 nationally.
“As SMSFs are made more accessible through technology platforms, young Aussies battling a cost-of-living crisis are keen to take control of their retirement savings,” she said.
“Our data also showed that 43 per cent of SMSF accounts are held by two or more members as investors look for ways to reduce fees and maximise long-term return.”
Conway said that when Stake first entered the SMSF sector a couple of years ago, it started to see a rising trend of younger investors, with the average age then just 39 years.
“We have now seen a trend in line with the rest of the industry where the average age of our SMSF investors is 42 years, which is still a lot younger than the industry average,” she said.
“We have seen a two per cent increase in women signing up over the past 12 months, partially due to current SMSF holders becoming more comfortable in adding a spouse to the fund, or including them from the start of the SMSF journey.”
Conway said the Stake experience also shows that women are more actively engaged in the future of their finances and taking control by making their own investment decisions.
“I think the trend in younger SMSF investors indicates that they are willing to take a little bit of risk and have got a longer-term strategy to work towards,” Conway said.
“We have seen a lot of younger SMSFs coming in after doing their own research and being empowered to make their own financial decisions for their future. They are more willing to take the bull by the horns.”
The investment strategy and choices of the younger SMSF trustees are also veering from the course set by the older, more traditional trustees, said Conway, although there are still strong ties to the ASX despite the opening of global equity markets.
“ETFs are popular as [are] the ASX and US equities as well,” she said.
“When we first started, the younger investors were very interested in the US equities space, but we have also seen a growth in the ASX investments. Younger investors are interested in technology stocks, but because we are now seeing a little bit more of the older generation using platforms and services like Stake, they often have a super portfolio that is predominantly in ASX but also entering the US market.”
Conway added that ETFs are proving popular with Vanguard, while Australian Shares Index ETF and BetaShares NASDAQ 100 ETF are ranking as the top two ASX holdings in Stake SMSFs, followed by traditional blue-chip and high-performers like BHP Group, Macquarie Group, and Woodside Energy Group.
