CleverSuper chief executive Chris Appleyard, who also heads non-institutional financial planning group Custom Wealth Solutions, is calling on more than 100,000 Australians to sign up to the campaign and obtain a free SMSF through CleverSuper.
“CleverSuper has the ability to offer every Australian a free SMSF to manage their retirement savings,” Mr Appleyard said in an email launching the promotion. “This is an end to $20 billion in admin fees within superannuation forever.”
Speaking to SMSF Adviser, Mr Appleyard said that if an SMSF investor’s behaviour is “quite standard”, the fund can be automated with data.
“Because I own the deeds, the deed is entirely automated, there will be inbuilt investment reporting, investment accounting and the data flowing through, you know that it is compliant because the systems are embedded.”
Mr Appleyard added that the administrative costs of SMSF establishment are over-stated and that trustees’ money is better spent on advice.
“The truth of the matter is that I can already give SMSFs away for free – the technology exists and is infinitely scalable,” he said.
“To be very specific, this is made possible by a number of softwares talking together, interacting with each other to enable transactions, correct transactions and administer them and ultimately flow it through,” he said, likening the technology to a mobile device app and describing it as an “iTunes for financial services”.
“We have the technology now, so why are we all being disingenuous and pretending to be necessary administrators of funds and then charging for that?
“What I’m saying is: get the barrier to setting one up out of the way and then, if your mandate is good enough, they will come to you for help anyway.”
When asked whether an SMSF is reasonably something that all Australians – regardless of net worth or financial literacy – can aspire to, Mr Appelyard said the idea of a minimum entry base for SMSFs is increasingly outmoded.
“The idea that you need a certain amount in investible assets or whatever is old thinking – we need to throw that idea out the window – you can have an SMSF with 20 bucks in it if you want,” he said.
“The question of ‘Should someone have one?’ is irrelevant – the point is everyone can have one. We need to change the perception; there’s no good reason why anyone can’t have an SMSF.”
“Just because you give someone more control, what are they going to do that people are so worried about?”
However, Centric Wealth chief executive Phil Kearns issued a statement yesterday expressing concern about just that.
Reflecting on recent figures from the Australian Taxation Office and SMSF Professionals’ Association of Australia (SPAA) research – particularly a SPAA finding that an additional 1.4 million people are considering setting up an SMSF – Mr Kearns warned of long-term detriment to retirees.
“This will mean the number of self-managed retirees will swell to almost 2.5 million,” Mr Kearns said.
“Is it likely that all these people will have the knowledge, experience and time needed to manage their SMSF effectively?
“In my view, this could create a number of problems for the individuals and the government, who may end up financially supporting these people down the track.”
We have been trying to set up a fund with Clever for 5 months. Have got no where. All smoke and mirrors.
Setting up SMSF for free
It sounds as if Chris is willing to take a loss somwehere only to make it up (and them some) somewhere else. His offering is very misleading as “nothing is for nothing Chris”. The fact that you also head up an advise channel is scary.
[quote name=”Drew Grosskreutz”]I think Chris has SMSF’s mixed up with hugs. Free hugs for all he meant to say.[/quote]
Too funny! Seriuosly thank you for a much needed giggle.
ASIC corporate trustee annual fees, Corporate register maintenance fees, ATO fees, regular audit and accounting costs are not scalable. If someone can do this for $20 per year only, then we will gladly send you all of our clients. It costs money to maintain compliance, professional development, office and communication, and servicing a client would cost far more than $20 a year even with technology.
Our research showed many “free offers” are actually “paid indirectly” offers where the seller receives commissions for opening CMA bank accounts, trading accounts, insurance, etc. Some pay a referral fee of $250 just for telling the client to open a stockbroking account.
Chris….I hope you are not discouraged or deterred by the feedback you are receiving from self interested people. You and I know I have NO affiliation with Clever super but I do believe your approach has a great future with SMSF’s….The best thing you can do is succeed well in your indeaver and prove them all wrong. I wish you the best of luck.
Reckless and somewhat misleading. They dont give financial advice according to the FSG. But they give financial advice to setup a fund. Upfront commissions + trail commissions on insurance – Bet they recommend a lot of policies !! Hello ASIC ????
Independent audit for a free service ?? Thats gotta smell wrong. Ditto the “free” tax. Last time I checked that wasnt arms length pricing. Love to understand the arms length independent service providers or is it some “tied agency” arrangement with a treat to independence.
Disclosure of trustee responsibilities will be interesting. They make it sound like they do it all for the trustees.
No SOA at all…Just general advice that “generally recommends a SMSF”.
Manoj’s comment is fair – How can they sustain this ?? What will happen when it all fails. Longin and “no access”.. Crash, bang, fail.
He also gives free SOAs!
I think Chris has SMSF’s mixed up with hugs. Free hugs for all he meant to say.
Chris…All of your doubters should learn from http://www.esuper.com.au read it and weep.
Join the 21st century or get left behind.
Interesting concept but nothing in financial services (including accounting and administration) comes for nothing. How much will Mr Appleyard charge to manage the investments and strategy? I can do the admin etc tax and have a audit done at a fair price and if the fund is invested in good investments there is a minimal charge (in most cases) for financial advice. The Appleyard idea will only work if the cost of keeping the fund and advising on investments and strategy is much much lower than the market at the moment.
So Mr Appleyard please tell us how much your financial advice will cost.
Is it April 1st? Because I checked my diary and it looks like you’ve published this article a couple months too early!
Gave me a great laugh however!
“…you can have an SMSF with 20 bucks in it if you want,
Absolutely reckless!
Chris, this an interesting proposition that you put forward regarding the relevance, appropriateness and management of an SMSF.
I am sure that the ATO and ASIC will enjoy interviewing the Authorised Reps of your financial planning practice about their advice processes and ensuring that you are acting in the clients best interest.
Perhaps this would make a ground breaking case study for the implementation of FOFA regulation.
The comments you have made sir are reckless and irresponsible.
@James J
The only thing missing from your comments is an “I’m affiliated with CleverSuper” disclaimer at the bottom.
Nice try.
Chris….Please do not be discouraged by the brick bats.
you are proposing a thoughtful and intelligent mechanized approach to a system most able to be relegated to an app.
All of the knockers are concerned you may entice their customers to migrate to your system…..KEEP UP THE GOOD WORK. Lateral and free thinkers are what SMSF Trustee’s need….have been waiting for…GO CHAMP GO.
Chris
I hope you can keep up the service at this price
Finally an intelligent man speaking sense.
See all the comments from Advisers who try to over complicate the process and find fault with the guy because he is the only one using his head….more power to him,I hope you collectively get lost in his dust
One thing Chris has done well is gain publicity.
We all know that with anything in life – including SMSFs – is that you get what you pay for.
Any individuals (or advisers) really need to do their due diligence on any ‘free lunch’ SMSF offer out there.
With most dirt cheap SMSF admin services, there is generally a catch or ulterior motive – i.e. restriction on products that pay commissions (check the FSGs), running the admin at a loss to pick up the advice work etc
Also, think about having a planning group controlling where the FP referrals go – AMP or Custom Wealth – is independence relevant?
I wonder where the work is done?
A quick LinkedIn search will quickly reveal reveal who (if anyone) is actually going to oversee these 100,00 new SMSFs.
just what the ATO want to see. Do they also get a complementary SMSF loan and off the plan property in QLD? Or do they get ‘referred’ for advice on such?
I have to agree with @Tonyspagony. It appears that the entire premise and business model of CleverSuper is built upon the notion of a “quite standard” SMSF. Having worked in the SMSF industry for a number of years I can virtually guarantee that 95% of my clients do not have a “standard” SMSF and thus, automating the entire administration function is impossible. Whilst a great idea, I just don’t how it will materialise.
In all my years of dealing with SMSF’s I have never heard such a ludicrous statement. I have seen trustees use cheque books to pay for coffee, buy art from their children, fix their car and the stories go on. One fellow bought a racing horse with the total from his account!! Lets get real here the admin is just as important as the correct setup. Correct advice stops the scammers. What you are paying for is educated properly qualified people looking after your best interest. Providing open slather will drag this into one big mess and then we will have even more government control. I applaud Mr Appleyards attempt to grow his business I just don’t approve of sweeping statements that cannot be born out of experience.