Self-managed super fund membership profiles are getting younger and women are doing comparatively better than men through their SMSF investments, according to the latest figures released by the Australian Taxation Office.
The figures show the median age of a newly established SMSF member has dropped to 48 years, compared with 55 five years ago.
Women have been doing better through SMSF’s than men with their funds achieving a five-year growth rate of 24 per cent compared to 17 per cent for men. However, men still have the upper hand on balance size with an average balance of $633,000 compared to $498,000 for women. The average SMSF balance is now $1.1 million, the ATO revealed.
SMSF Association Managing Director/CEO Andrea Slattery says: “The ATO statistical overview for 2014-15 reveals a very positive set of numbers. All the indicators show solid growth, with the average assets of SMSFs reaching $1.1 million – a growth of 20% over five years.
“There were 577,000 funds (99.5% of the number of super funds), with growth over the past five years of nearly 6% – a sustainable increase. In terms of trustees/members, there are now nearly 1.1 million, split 53:47 per cent between males and females.
The relative performance of women’s funds is “ further evidence that women are becoming far more involved in their SMSFs, either individually or by getting specialist SMSF advice,” Ms Slattery said.
She says the fact the median age of SMSF members of newly established funds has fallen to 48 years compared with 59 years for all SMSF members at 30 June 2015 is a welcomed demographic shift.
“It shows younger people are being actively involved in their retirement income strategies, and this can only enhance their ability to achieve a dignified and secure retirement.”
SMSF investment returns in 2014-15 were 6.2 per cent – similar to the returns of the APRA-regulated sector.
ATO analysis shows the estimated total expense ratio for SMSFs as funds (not per member) in 2014-15 was 1.1 per cent and when split between investment and administration, they were 0.5 per cent and 0.6 per cent respectively.
Australian-listed shares, cash and term deposits dominate asset allocation for SMSFs , at 57 per cent. Self management also dominates with 81 per cent of all investments undertaken directly. Managed investments account for 19 per cent.
SMSF investors appear to be looking at new options for yield in a low interest rate world. Ms Slattery said cash and fixed term deposits declined slightly as a per centage of investments, with an increase in trusts and other managed investments.
“This would suggest that although trustees are still investing in traditional assets, they are increasingly flexible in investing in new asset classes, including offshore, in search of yield and capital gain. In this investment environment, we believe there is a real opportunity for SMSF specialists to play an active role in helping trustees further diversify their portfolios,” she said.