Three types of costs
SMSFs generally fall into three categories:
1. Set-up costs
Several one-off costs are involved in establishing your SMSF. They include costs for preparing your fund’s trust deed, establishing a company (if you choose a corporate trustee structure) and registering the fund.
2. Ongoing administration costs
The administration costs associated with running an SMSF are recurring and can include compliance, general administration and audit costs.
3. Portfolio costs
Investment charges, broker and professional advice fees are considered portfolio costs. Financial planners typically charge a flat fee, an hourly rate or a percentage of funds under advice. These fees can vary depending on your account balance and how often you seek advice.
How your fund’s structure affects cost
When setting up your fund, you’ll need to choose an individual trustee or a corporate trustee structure. It’s a key decision when setting up your fund and will affect your fund’s set-up costs and the way it needs to be managed.
Generally you’ll pay more to establish and maintain a corporate trustee structure but one of the benefits is that you may have less paperwork in managing your fund down the track.
Where can I find out more?
If you’d like to find out more about the costs associated with running an SMSF speak with your financial adviser or call us on 131 267 Monday to Friday from 8am to 8pm and Saturday and Sunday between 9am and 5pm AEST.
Ensure your SMSF complies with new rules in 2015