SMSFA refutes SMSF criticism in Fairfax Media

SMSF association, Fairfax media, SMSFsThe SMSF Association has refuted recent criticism of SMSFs in Fairfax Media publications.

“You may have seen the Fairfax Media articles on SMSFs over the long weekend. They provided harsh criticism of the sector with a strong focus on small balance SMSFs, fees and SMSF investment returns. Many of these arguments were a repeat of concerns we have seen aimed at the SMSF sector before,” said a statement by the SMSF Association.

The Association does not name the articles in question, but they are likely to include:

“The SMSF Association (SMSFA) is aware of the issues that smaller SMSFs can face in relation to expenses and investment returns and has always stressed the need to carefully consider starting an SMSF – no matter what the size a person’s starting balance may be.  The decision to set up an SMSF is not trivial and should only be done after seeking specialist advice,” said the SMSFA.

“SMSFs are not a universal solution for everyone but have provided a healthy competitive balance to large APRA-regulated funds (a view endorsed by the Federal Treasury) where despite the massive growth in assets and scale benefits, lower fees have barely been passed on to members.”

“The articles were critical of SMSFs being set up inappropriately or ‘spruiked’ to consumers.  We note that ASIC has considerable power to shut down ‘spruikers’ if they are not properly licensed or fail to meet the best interest test.”

“While the article has raised some important issues for trustees and professionals alike to consider, we take issue with some of the assumptions, inaccuracies and SMSF myths put forward.”

The SMSF Association has published a list of issues raised, and counter-arguments, which can be found here.

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