Consider these 4 major factors for your SMSF March 2022


As February comes to an end and March kicks off, SMSF trustees should think about some of the bigger challenges in the coming months. Investment plans, the aging population, changes to super laws, and ultimately the elections and superannuation are major factors to take into consideration.

Make sure to reach out to a Create and Protect specialist for all of your SMSF inquiries.

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1. Examine your Investment Strategy

The SMSF's liquidity and cash flow is one of the factors to consider while developing an investment strategy under superannuation rules. This entails determining whether the fund can fulfill its responsibilities and expenses, such as loan repayments as well as pension payments and other fund expenses.

Insurance is another component of a fund's investment plan to be examined. When it comes to personal insurance, Australians in general - and younger Australians in particular - are typically under-insured; life insurance, disability insurance, and so on. Most people have no hesitation in insuring their belongings, but they are reluctant to insure the source of income that pays for those belongings: insuring themselves. When it comes to insurance coverage on a person’s life or when he/she becomes disabled, an SMSF can be an excellent alternative. When it comes to insurance through SMSFs for younger people, there are some convenient strategies, so this year would be a good time to look into it.

We advise trustees to seek suitable and licensed advice from a Create and Protect SMSF specialist to stay in control of your funds.

2. Consider Australia’s aging population

The main purpose of having an SMSF is providing retirement benefits. Noting that more than four million Australians were born between 1946-1961, these ‘Baby Boomers’ are now aged between 60 and 75. The percentage of the people in retirement age has risen dramatically, while the percentage in prime working age has begun to decline. These occurrences have an impact on taxation because they result in a decrease in government revenue due to decreasing labor force participation and increased need for government programs that assist aged Australians.

Australia’s aging population might need to rely more on their superannuation savings during retirement as they will most likely be living longer than any previous generation.

Estate and succession planning is also an important consideration to help ensure peace of mind.

If the trustee of the SMSF is incapacitated because he/she cannot undertake trustee duties, the fund can fail to qualify as an SMSF. This could lead to compliance issues meaning that succession planning is crucially important in 2022.

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3. Get familiar with legislative changes

In 2022, the super law will undergo a number of modifications, most notably to the contribution rules. At the end of 2021, the government introduced in parliament the Treasury Laws Amendment which enhanced superannuation outcomes for Australians and helped Australian businesses invest, under the Bill 2022. The bill thus aims to improve flexibility for Australians preparing for retirement.

Anyone under the age of 67 can currently contribute to super without having to pass a work test. The bill essentially abolishes the work test (40 hours work in a 30-day period) so Australians aged between 67 and 75 can also make non-concessional contributions to superannuation. As expected, the new rules also extend to bring forward opportunities up until the year in which the member turns 75. Re-contribution strategies may be able to change the balance of tax-free and taxable components to the trustee’s benefit for estate planning objectives.

4. Look out for the election year budget

This year, a federal election is scheduled to be held in May 2022 and the government has set the date for a budget in March.

Budgets in an election year normally include certain incentives, and the changes to superannuation - that are currently being reviewed in parliament - symbolize an excellent example.


Achieve long-term independence with superannuation management

In Australia we are fortunate to have a world-class, tax-efficient superannuation system. A self-managed superannuation fund (SMSF), backed by insightful and strategic advice from your Create and Protect team, is your key to effectively building your retirement wealth.

Consider these 4 major factors while you plan for, review and organize your SMSF, and remember that we are here to help you achieve more with flexible, informed and verified SMSF strategies so hurry up and reach out to us.

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