Take Control of Your Superannuation - McCarthy Group Take Control of Your Superannuation - McCarthy Group

Take control of your superannuation

And drive growth through investment property

More than three quarters of Australians are likely to outlive their super, with 78% of the population having to rely on the age pension for income support1.
Taking control of your superannuation account through a “DIY Super” fund is a strategy that could allow you the freedom and flexibility to grow your wealth for the comfortable retirement you dream about.

Superannuation – understanding the basics

  • 1.Your employer is required by law to
    deduct 9.5 cents from every dollar you
    earn, known as The Superannuation
    Guarantee contribution.
  • 2.The deduction is subject to 15%
    Contributions Tax. The balance is
    paid direct to your super fund
    manager who invests it on your behalf.
  • 3.Your super fund (Trustee) manager puts
    your money into managed funds. These
    are a pool of investments, usually a
    combination of shares, bonds property or cash.
  • 6.When you retire you can access your
    superannuation.
  • 5.This process is repeated
    continuously until you reach
    retirement age.
  • 4.If your fund manager chooses wisely the
    investments earn positive returns. The
    returns are added to your super fund less
    15% earnings tax and management fees.
  • 4.If your fund manager chooses wisely the
    investments earn positive returns. The
    returns are added to your super fund less
    15% earnings tax and management fees.
  • 5.This process is repeated
    continuously until you reach
    retirement age.
  • 6.When you retire you can access your
    superannuation.

Questions and Answers

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Who chooses the super fund
manager?
Just like choosing a health fund or car insurance, you are free to choose your super fund manager.
Can I choose how the super fund manager invests my money?
Your fund manager has several “market” combinations they can offer dependent on your risk profile and objectives.
Will my super grow in value?
Normally, yes, but there are no guarantees that your contributions will be returned to you or that your investments will achieve any return.
Will my super allow me to have a comfortable lifestyle at retirement?
That depends on how much you spend and how well your fund performs. Generally speaking, superannuation will only provide enough for a fairly basic standard of living2

DIY Super

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Can I manage my own super on a DIY basis?
Yes, providing you have a big enough balance and are prepared to do what’s required to manage the fund. DIY funds are currently the fastest growing segment of the super market
What is DIY super?
DIY super is also known as a Self Managed Superannuation Fund (SMSF). As the names suggest, you are managing your own investments.
How does it work?
The same process applies to employee deductions and payment as with an externally managed super fund. The difference is you establish your own fund, and your contributions are sent to your own fund instead of to a super fund manager. As Trustee (manager) of your fund, you have the freedom to choose where to invest your money from a range of investment options.
Where can I invest?
The most popular choices are Australian shares or property.
I would like to invest in a property but my super fund doesn’t have enough cash. What are my options?
Your super fund needs to have enough cash to cover the deposit, establishment costs and a small cash balance. You can then apply to a bank for an investment property loan to cover the balance.
How do I make loan repayments if I invest in property?
Loan repayments can be made by a combination of rental income as well as your ongoing super contributions.

The Benefits of DIY Super

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Control
You are the best person to take control of your retirement savings as you have the most interest in their positive investment performance. The ongoing contributions are your money, and the subsequent investments will fund your retirement. You also gain full control over the investment strategy.
Visibility
You have full visibility of your investments and how they
are performing.
Asset protection
Assets held in the super fund are generally protected from bankruptcy
proceedings.
Tax effective
• Contributions: Money invested in your SMSF is taxed at 15%. In other words, for every $1,000 invested into your SMSF only $150 of it will go to the ATO. In most cases this is lower than the investor’s normal marginal tax rate.
• Income: Income made by the fund such as profits or rental is also taxed at 15%. If you sell the property once you reach the pension phase, and make a capital gain, there is no tax to pay. If you decide to hold the property, there is also no tax payable on the rental income.
Greater flexibility
An SMSF can hold any asset class as long as it has been previously approved by the ATO. You have the flexibility to invest in shares, managed investments or property, to name a few.
Structure
You are able to invest in individual properties and structure your portfolio depending on your needs. Your super fund money can be used for a deposit and the bank will lend you the rest. If the property is negatively geared the shortfall can be made up by your super contribution.
Borrowing capacity
When you purchase a property within a SMSF, it is the SMSF that is assessed for the borrowing capacity, not you as an individual. This will allow you to continue to increase your asset base.

The risks when buying property in a DIY Super Fund

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Strategy
As the Trustee, you, plus any other fund members are responsible for creating an investment strategy and ensuring the fund complies with all the legislative requirements.
Property risk
If you decide to invest in property you are exposed to the overall risk of properties. Properties can rise and fall in value regardless of whether you are purchasing a property inside or outside of super. (The same applies to share values).
Liquidity
If you need to sell your property, it could take some time as property is not as liquid as other investment classes such as shares.

Azure Group and McCarthy Group – Partners in your DIY investment success

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Introducing Azure Group

Azure Group Wealth is a fully accredited independently owned financial planning firm. We specialise in helping people develop the right financial plan to build their wealth and protect their assets. A SMSF is actually very difficult to manage entirely by yourself. As specialists in DIY super, Azure Group can help with the set up and successful management of your fund.

Introducing McCarthy Group

McCarthy Group has a 16-year track record of investment property success in markets across Australia. The key to their success is their ability to identify markets that are primed for economic growth and that will provide strong growth in capital value and rentals. McCarthy Group provides customers with a turnkey solution, from picking the right location, providing the block of land and then building a purpose-designed home that leads the industry in terms of quality specifications and long-term guarantees. McCarthy Group is also able to manage the property for you through their specialist property management team.

The best of both worlds

The partnership between Azure Group and McCarthy Group brings together the expertise of two industry leaders and puts it to work to enhance your retirement income. Through this unique partnership you could achieve:

  • Professional set up of your DIY super fund
  • Power and control over your own fund and investment strategy
  • Leverage to borrow and invest in property
  • Geared investment property or properties in your fund
  • Expert knowledge about where to invest for property growth
  • A purpose-designed rental home built to the highest quality specification
  • Professional property management
  • Expert support throughout the growth and development of your fund’s portfolio
  • A turnkey solution where all the work is done for you
  • Peace of mind from knowing your DIY super fund and investment property havebeen established by experts in their fields.
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Azure Group

  • Specialist DIY SMSF experience and services
  • Set up of your DIY Super fund
  • Support in developing investment strategy
  • Management of all fund set-up administration
  • Support in meeting compliance requirements
  • Advice and guidance on investment planning
  • Support in transition to retirement and pension.

McCarthy Group

  • Affordable Best Practice SMSF property
  • Identify growth location for investment property, including the block of land
  • Access to investment finance
  • Purpose-designed rental property built by Master Builders
  • Industry-leading home quality and long-term guarantees
  • Property management through Koala Blue Real Estate.