ATO statistics contain “positive story” for SMSFs: SMSF Association

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The SMSF Association says new superannuation statistics from the ATO “tell a positive story” about the SMSF sector.

The ATO has recently released its statistical overview of SMSFs for 2016/17, based on SMSF Annual Returns, registrations and auditor reports.

SMSF Association CEO John Maroney said: “These statistics reveal an SMSF sector that has not only performed well but provides a positive outlook for its future growth and strong performance.

“In the year under review, SMSFs made an average return of 10.2 per cent compared with a 9.1 per cent return for the APRA-regulated funds.”

“At the same time the total expenses for all SMSFs fell by nine basis points, of which five basis points can be attributed to lower administrative and operating expenses, highlighting the increased use of technology and software in SMSF administration services.”

Maroney said that the impact of improved adviser standards and trustee education could be seen in the statistics, pointing to an increase in SMSF assets at establishment. In 2015/16 new SMSFs had an average of $379,000, but by 2016/17 this had increased 38% to $521,000.

“From the Association’s perspective, this demonstrates that SMSF trustees are getting quality SMSF advice and that they understand the need for an appropriate-sized SMSF to ensure they get the full benefits from their fund.”

Maroney said the statistical releases by the ATO helped present an accurate picture of the SMSF sector.

“These statistics provide an important antidote to the many misconceptions about SMSFs, especially in relation to their performance and costs, as well as providing highly relevant information that can be used to improve our superannuation sector.”

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5 thoughts on “ATO statistics contain “positive story” for SMSFs: SMSF Association”

  1. I suggest that anyone who wants the complete story on SMSF performance versus “Large APRA Funds” (LAF) should look at the page at the ATO showing investment performance:–A-statistical-overview-2016-2017/?page=5#SMSFreturnOnAssets

    Look at graph 13 which shows the performance by fund size. You will see that the only SMSF segment that outperformed the LAFs was SMSFs of $2m or more, something that “SMSF Association CEO John Maroney” failed to mention. As these large SMSFs very significantly outperformed all other SMSFs (and the average large APRA fund) they skewed the averages quite significantly. I do not doubt that smaller than $2m SMSFs can outperform LAFs but on ‘average’ you need an SMSF of over $2m to manage the feat.

    I would really like to see the breakdown of these >$2m funds just to see whether this out-performance is limited to the very large SMSFs but such information is not available.

    1. Though the ATO also warns, on the same page: “Care must be taken when using SMSF performance figures, particularly when making comparisons. While the methodology used to estimate SMSF performance resembles APRA’s methodology, the data collected is not the same.”

      The Productivity Commission report on superannuation, released earlier in 2019, has much more detailed performance information. The Commission found that: “Large SMSFs earn broadly similar net returns to APRA-regulated funds, but smaller ones (with less than $500 000 in assets) perform significantly worse on average.”

      1. Hello Luke,

        Yes I saw the warning but the variance in returns between the various SMSF groups (by balance)is so great that it makes the point before we get to comparing it the APRA funds. If we use the data in the “Productivity Commission report on superannuation”, it is (to me) quite clear that (on average) only those SMSFs in the $2M+ range will out-perform the APRA funds. The difference between the $1.5-2M and the $2m+ bands is quite high, much higher than I would have thought, so the $1.5-2M range would IMO under-perform the APRA funds.

        I suspect the very large funds greatly out-perform as they have the luxury of sufficient assets that they can employ very aggressive investment strategies.


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