Self-managed super funds continue to steam ahead as Australia’s fastest-growing superannuation sector, and you may be surprised by the latest figures.
According to the Financial Services Council’s (FSC) inaugural report on the flow of funds into SMSF
s, released yesterday, Australians contributed $24bn into SMSF
s during the 2010/11 financial year – up 15% ($2.8bn) on the previous year’s tally.
Other key findings included:
Member (discretionary) contributions grew by $3.2bn (19.8%) to $17.2bn and employer (compulsory) contributions grew by $0.3bn (4.9%) to $7.2bn.
After falling for three consecutive years, net flows to SMSFs increased by $2.8bn (22.5%) to $15.4bn.
Inward transfers grew by 15.3%, while outward transfers were almost flat – increasing by 0.4%. Benefit payments out of SMSFs increased by 13.9% to $19.7bn.
SMSFs held assets valued at $438.9bn in June 2012.
Listed and unlisted shares accounted for the largest share of SMSF
assets at $136bn (31%) – only slightly larger than funds held in cash and deposits at $134bn (30.5%).
Long-run changes in asset allocations continued in 2010/11. The proportion of assets held as cash and deposits has increased 5% from 25.5% in 2008, while assets held in shares has fallen 2.4% from 33.4%.
The proportion of assets in ‘listed and unlisted trusts’ has fallen from 16.7% in 2008 to 12.4% in 2012.
“The rebound in growth in discretionary contributions into self-managed super funds in 2010-11 was triggered by the improvement in the economic growth and investor confidence following the financial crisis,” said FSC CEO John Brogden.
“It is critical that investment appetite for discretionary super is retained across all segments of the superannuation industry.”
Chief economist and report author James Bond added that SMSF
s are “trending towards bigger holdings in cash and deposits which have increased from 25.5 per cent of total assets under management in 2008 to 30.5 per cent”