22 November, 2022

SMSFs: Are you better off managing your own super?

If you're looking for more flexibility and control over your super, a self-managed super fund (SMSF) could seem quite appealing. After all, it allows you to take charge and decide where your hard-earned retirement savings are invested.

But if you don’t have a spare 100+ hours — the amount of time the Australian Securities and Investments Commission (ASIC) estimates it takes to run an SMSF each year1 — you might want to think again.


What is an SMSF?

SMSFs operate very differently from regular APRA-regulated (Australian Prudential Regulation Authority) super funds, like Spirit Super.

One of the big differences between an APRA-regulated fund and an SMSF is that they’re overseen by different regulators — APRA-regulated funds are regulated by APRA, and SMSFs are regulated by the Australian Taxation Office (ATO).

Another difference is that SMSFs can only have a maximum of six members, whereas APRA-regulated funds can have millions of members.

Importantly, with an SMSF, the members are also the trustees.

That means that if you set up an SMSF, you're in charge. You — not your super fund — are the one making the investment decisions. You’re also responsible for complying with the super and tax laws.

What’s involved in managing your own super

Setting up and managing an SMSF takes a lot of time and effort.

To set up an SMSF, you have to:

decide on fund members and trustees,   establish the trust and trust deed,   set up a bank account,   register with the ATO,   create your investment strategy and include a plan for when your SMSF ends

And that’s just the beginning. Once you’re set-up, you have to:

Sroll over your existing super,   organise employer contributions,   accept contributions within limits,   make investments without breaking rules,   regularly review the investment strategy and   document and maintain records for ten years

Then each year, you need to: 

value assets,   prepare accounts and financial statements,   appoint a registered SMSF auditor,   lodge the annual return,   pay the SMSF levy and   pay any tax that’s due

And once you start making super payments, you need to:

decide if any assets need to be sold,   ensure minimum payments are met each year,  appoint an actuary,   withhold tax and   give payment summaries to members and the ATO

Then when the fund is finished, you’ll need to: 

get a final audit,   lodge your final return,   pay outstanding tax  and pay out or roll over all of the assets

For a more in-depth look at what’s required to wind-up an SMSF, visit the

Will you do it yourself or pay a professional to help?

Running an SMSF isn’t for the fainthearted. It’s a serious commitment, and you need to be confident that you have the time, the skills, and the desire to do it all.

Of course, you could always engage SMSF professionals to help, but it’s worth bearing in mind that, even if you hire experts, you’re the trustee of the SMSF. Ultimately, if anything goes wrong with your SMSF, you’re responsible and accountable.

Seek expert advice (not just neighbourly advice)

It’s true, some people have done well out of SMSFs. You’ve probably come across a few passionate folks keen to tell you about their success.

But just because your neighbour or workmate has made hay with an SMSF, it doesn’t necessarily mean it’s right for you and your situation. Everyone’s retirement needs and goals are different. And everyone has different skills and experience when it comes to managing finances.

As with all decisions about your financial future, it pays to get expert advice. So if you’re thinking about going down the SMSF path, talk to a professional to make sure it’s right for you.

Is it flexibility that you’re after?

If the ability to choose where your super is invested is important to you, you might be surprised to learn that traditional super funds can also offer flexibility.

When you’re a Spirit Super member, you can decide how your super is invested, or leave it to us to take care of it for you.

We offer a selection of pre-mixed options and asset class options. You can choose one investment option or a combination of different investment options. In choosing which option/s to invest in, you’ll need to consider the objectives and strategies of each investment option and which option/s best match you and your goals.

For more information, see our Investment guide.

If you need help choosing an investment option that is right for you, call us on 1800 005 166. We’re here to help.


More information

For more information on setting up and running an SMSF, head to the ATO website. They have an excellent suite of videos that clearly and simply outline the work involved in managing your own super.