Self Managed Super Funds by Wealth Advantage

Let’s talk about some of the recent changes to the rules for Self Managed Super Funds that may affect you. According to the new rules, trustees of Self Managed Super Funds must now review their investment strategy regularly (which typically means at least annually). The strategy needs to reflect the purpose and circumstances of your fund and consider the following diversification, liquidity, maximise returns for members and circumstances of members.

Also, when developing or reviewing an investment strategy, fund trustees must now also consider whether the fund should hold a contract of insurance that provides insurance cover for one or more members of the fund.

While this does not mean that an SMSF must actually provide insurance cover for its members, where insurance is required it’s likely that the level and type of insurance cover will be determined by a members own personal circumstances.

After determining whether there is a need to hold insurance for its members, we recommend that trustees include a statement in their investment strategy discussing their insurance cover decision for all members of the fund. As this is one of the compliance requirements that an auditor must review each year, trustees need to be able to clearly show insurance has been considered, even if the decision is made that no insurance is required.

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