Managing your own super can mean more control, but it's important to understand the risks and responsibilities that come with it.

Self-Managed Super Funds (SMSFs) aren’t for everyone. To help decide whether an SMSF is right for you, consider the following:

• Do you have time?

Depending on level of control, you may need to devote a couple of hours each week to running the fund and decide who will step in and keep everything running if you get sick or go on holidays.

• Do you have the knowledge and experience?

You’ll need to be familiar and comply with superannuation, tax and other relevant legislation, your fund’s Trust Deed and administrative requirements set by the government and financial services regulators. Failure to meet your legal responsibilities may result in penalties.

• Do you have enough super?

Generally, the costs associated with running an SMSF may be higher than other alternatives with the median costs of  $8,611 per year^#. The more super you have, the more economically viable an SMSF may become.

• Will you get a better result?

One of the main advantages of SMSFs is that you get to pick your own investments. Consider whether you have the knowledge and expertise to  achieve returns  comparable with a regular super fund.

• Can you afford it?

It’s hard to say exactly how much it costs to set up and run an SMSF as every investor is different. However the ATO found the median SMSF operating expenses totalled $8,611 per year^#.

1. Set-up costs: Investment strategy and general trust advice, trust deed, ATO application forms, ASIC forms, and a service provider fee.

2. Administration and compliance costs: Auditing, tax and accounting costs.

3. Investment costs: These are depending on how complex and sophisticated your investments are and how often transactions are made.

^#Self-managed super funds: a statistical overview 2020-21. Australian Tax Office, SMSF Expenses, median total expenses.

• You bear the risk: As the trustee, you are legally responsible for every decision and action your fund makes. Even if you get professional advice, the responsibility ultimately rests with you. Violation of the strict laws that govern the super industry could mean the loss of tax concessions in addition to tax and legal prosecution.
•  It’s time-consuming: Meeting all the legal and administrative requirements can take a lot of time and effort. Any outside help you get will be an additional cost to the fund and you’ll need to be sure about who is running it when you are sick or on holiday.
• There’s no independent umpire: SMSF trustees don’t have access to the Australian Financial Complaints Authority if problems arise. As many SMSFs are family structures, any disagreements about how the fund is managed could result in costly and time-consuming legal action. SMSFs have less protections against theft and fraud than APRA regulated funds.
• Difficulties when closing down your SMSF: If you decide to close down your SMSF, there are significant administration steps that you must fulfil. The ATO must be notified and you will also have to do the following: - Payout or rollover member benefits in compliance with superannuation and tax laws and your Trust Deed. - Arrange a final audit and the final SMSF annual return. - Receive confirmation from the ATO that your SMSF has been wound up. - Close your SMSF bank account(s).

Do you meet the sole purpose test?

Starting an SMSF doesn’t mean you can access your super benefits early or use the money to pay off your mortgage or go on a holiday. Like all superannuation funds, SMSFs must be maintained for the sole purpose of providing retirement or ancillary (death/ill health) benefits, and the ATO imposes harsh penalties for breaches and they may also prosecute  for compliance failure. Residential property in your SMSF can’t be used by yourself or related parties.

What are you giving up?

Cbus offers access to affordable death, disablement and income protection insurance cover because of our large membership numbers. With an SMSF, you may not be able to get the same cover and you may need a medical assessment. Additionally, you will no longer have access to the our advice team.

• You’re in control financially and legally: As the trustee, you have complete control over the fund’s investments. You and any other members of the fund are responsible for making decisions.
• Flexible choice and decisions: You decide what, when and how much of your super to invest. You are able to set the framework for making investment decisions and switch or modify those investments as you see fit.
• Responsibility over design and operation: You have a degree of control over the rules of the fund and how it operates; however, it’s important for you to be aware of regulatory changes and ensuring that your fund complies with them.

If you’ve been running your own SMSF and have had enough? Our Advice Services Team are here to assist you make the transition and help set up your new Cbus account.

How to open a Cbus super account and roll over your SMSF balance

1. Open a Cbus super account

Depending on whether you’re still working or are already retired, you’ll need to roll over your super into either a Cbus super or super income stream account.

If you’re working, it’s easy to join Cbus online at cbussuper.com.au/join

If you’re retired, call us on 1300 361 784 and to speak with one of our advisers to set up your account.

Already have a Cbus account? Have your Cbus member number handy.

2. Roll over your SMSF super balance into your Cbus account

Simply login to your online account at cbussuper.com.au/login and go to Consolidate your super.

You will need to provide us with the SMSF name, ABN and Electronic Service Address (ESA) of your SMSF to rollover any super from your SMSF to Cbus. If you need an ESA, you can obtain this from:

• your SMSF Administrator, tax agent, accountant or bank; 

    or

• a dedicated SMSF messaging provider – go to ato.gov.au for registered providers.

• you can complete and sign the Combine your super into Cbus form at cbussuper.com.au/forms

Our Advice Services team can give you advice on any aspect of your Cbus super account, over the phone. There’s no additional cost to speak with an adviser – it’s part of your Cbus membership.

If you need advice on more complex matters, our advice services team can refer you to an accredited financial planner for a face to-face meeting. The financial planner can offer you advice on a fee-for-service basis. Your first visit is free and any fees for advice will be agreed with you in advance.

Visit the Cbus advice page or call  1300 361 784 to find out more.

Additional information

The ATO provides a detailed overview of what you need to consider before setting up an SMSF, how to set up and run an SMSF, and how to wind up an SMSF. Visit  the ATO website for details.

General Advice Warning

The information on this site is of a general nature. It does not take your specific needs or circumstances into consideration, so you should look at your own financial position, objectives and requirements and seek financial advice before making any financial decisions. You should also read the relevant Cbus Product Disclosure Statement and Financial Services Guide and Target Market Determination before making any financial decisions. Call 1300 361 784 for a copy.

Past performance is not a reliable indicator of future performance.