As self-managed superannuation fund is a kind of Do-It-Yourself superannuation fund that is important to have when planning for your future. There are a lot of recommendations when it comes to setting up and sunning such a fund, one of the important requirements is a retirement strategy. Your SMSF has a couple of requirements that it has to meet, diversification is one of the most important factors. It is prudent to diversify your SMSF investment portfolio by including a variety of assets. Diversification offers a buffer against unexpected losses and if you have played the stock market you know it always goes up and down or is aware of what makes the economy works, you know that the future is uncertain, and what works now might not work twenty years later. Get detailed information about various types of funds and aid programs that are being managed by public and private organizations, on this website: http://www.extramoneyinfo.net
An investment strategy is effectively the blueprint for dealing with your fund’s assets to ensure the SMSF’s investment objectives and members’ goals are met. It effectively puts in writing what you are thinking and intending to do. Checking that you have this document, and it aligns with your actions is where the ATO is going with their letter campaign.
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Is your SMSF investment strategy meeting diversification requirements?
- Information about you know the risks and ha a plan to deal with them
- Liquidity of all your investments, highlighting expected returns or income (if any)
- Information on the fund’s ability to pay current and future liabilities as well as all the benefits of the members.
- A sound and deep understanding of your fund’s objectives
Diversification is about not putting all your eggs in a single basket. If you buy Gold SMSF it should be part of your investment basket. Still, make sure you have a good idea of what makes gold a sound investment asset. A good SMSF investment portfolio will have a balanced mix of liquid and illiquid assets. Consider its flexibility as well. Does your portfolio allow you to change certain aspects? The point is: you know and understand what you are doing. This will be evident in your investment strategy. An Investment Strategy is a legal requirement by the Australian Tax Office (ATO), and you don’t want to be on the wrong side otherwise you can lose a lot of money.
You should review your investment portfolio at least once a year before the approval of the Fund by an auditor. ATO has always emphasised the need for fund trustees should review and update their strategy documents. The auditor will ask to see the strategy documents and discuss updates with you.
You can include or used your SMSF to buy gold. There are a few key considerations that should be made:
- The gold should be stored properly and protected. If you buy Gold SMSF it cannot be stored at home but a dedicated vaulting service provider.
- Your gold should be insured but it cannot be insured in an individual’s name but under the SMSF’s name.
- Storing and maintaining the sales and purchase documents of the gold.
Saving for your future is important, investing in gold is even better as it can protect your wealth against the risks that come with inflation, falling currencies, and other economic risks.