This represented a total increase of $3 billion (15 per cent) in contributions from the previous year. “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,” says John Brogden, CEO of the Financial Services Council (FSC).
“It is critical that investment appetite for discretionary super is retained across all segments of the superannuation industry.”
Of the $24 billion, discretionary contributions represented by far the largest growth rate with a $3.2 billion (19.8 per cent) increase to $24 billion between 2009-10 and 2010-11, while employer contributions grew by $0.3 billion (4.9 per cent) to $6.8 billion during the same period.
The FSC’s Bond Report on SMSFs is based on the most recent Australian Tax Office data on the contributions and outflows for self-managed super funds, which is released annually with a one-year lag.
Listed and unlisted shares accounted for the $136 billion (31 per cent) of SMSF assets just above cash and deposits at $134 billion (30.5 per cent).
“SMSFs 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,” wrote author of the report, James Bond.
After three consecutive years of downturns, net flows to SMSFs increased by $2.8 billion (22.5 per cent) to 15.4 billion in 2010-11. In June 2012, SMSF’s had $438.9 billion under management.
Inward transfers grew by 15.3 per cent while outward transfers were almost flat, increasing by 0.4 per cent. Benefit payments out of SMSFs increased by 13.9 per cent to $19.7 billion.
William Fraser, Head of eSolutions Services for J.P. Morgan Worldwide Securities Services Australia & New Zealand, said a key consideration for large local funds is managing the challenges of disengaged members and the outflow of engaged members moving to set up SMSFs as their balances grow and they near retirement.
By: Andrew Starke
11th October 2012
Source: Professional Planner http://www.professionalplanner.com.au
13th-November-2012 | 