Many Australians have started self managed super funds (SMSFs) with insufficient funds and limited knowledge of their obligations, according to Asgard senior technical manager Gemma Dale.
SMSFs can provide great opportunities to the right investor, however, most investors still need advice on issues such as costs, new investment strategies and government regulation, Dale said addressing a workshop at the 2008 Securitor Convention.
"Not making informed decisions on these matters could adversely affect the positive outcomes SMSFs deliver to the right investors," she said.
Australian Tax Office research indicates that a third of all SMSFs have assets of less than $200,000, with annual fees as high as 10 per cent per annum, according to Dale.
As much as a quarter of all SMSF money is invested in cash and fixed interest, she added.
"(This) indicates that that a substantial proportion of SMSF trustees don't have the best strategy to deliver real advantages in terms of cost saving, diversification and control over asset selection," Dale said.
"Sadly, many SMSF trustees have inadequate knowledge, and this is where the advice of a qualified financial adviser can really provide valuable outcomes".
A review of the SMSF sector instigated by Minister for Superannuation and Corporate Law Nick Sherry will soon take place.
Dale said this would be a timely opportunity for financial advisers to review the service they are offering inexperienced SMSF trustees.
