Having been in the advice business for such a long time, I have witnessed the ‘do it yourself’ concept move from a trickle to a veritable Warragamba Dam wall failure. As a consequence, the notion of “I can do better” has resulted in the tremendous growth of ‘Self Managed Super Funds’ (SMSF) with all manner of people deciding to chart their own course when it comes to retirement investments.

Back in the day, the SMSF was always seen as the exclusive terrain of the ‘astute business person’ normally the proprietor of a private company with a SMSF set up via their accountant as part and parcel of the accountants’ service offering. Unfortunately, I recall seeing many business clients during the early 1990’s who, having succumbed to the magic of a SMSF, really struggle with the complexities that accompanied it and particularly in regards their investment strategy.

Alternatively there was also the few that used their superannuation funds for, may I suggest, consumer items, within the higher echelon of pricing, masquerading as investments e.g. “Wow, your super fund bought a Ferrari” Yes readers, back when mobile phones were only available mounted in your car; some people were using the system of retirement saving for alternative purposes which may not have specifically meant retirement.

Impossible these days, but back then an SMSF could invest in al- most anything that remotely re- sembled an ‘asset’ – exotic cars and boats being at the top of the list.

Those days have long gone and today the SMSF is a valid and very useful investment vehicle when used correctly. The ability to em- ploy just about all types of invest- ments, alone makes the SMSF a most handy instrument, but add to this the numerous other fea- tures such as estate planning et al, and we begin to realise we may have stumbled onto the ‘holy grail’ of retirement planning!

But remember, the first ‘S’ in SMSF stands for “self” which is by far the most attractive feature of the product. It is therefore very important to remember, when considering moving your funds into a SMSF make sure you are prepared to take on the investment responsibility.

Having to pay an adviser for providing investment advice really is adding a level of cost that could be easily avoided and in a way, defeats the purpose of opening an SMSF in the first place. Yes I know, most SMSF owners have been guided into the product via an adviser and therefore in these cases the product should be referred to as an AMSP (Adviser Managed Super Fund). I know there is no such acronym but there bloody well should be, I say!

The true advantage of an SMSF is the ability to strip out the costs associated with both the retail su- per offerings and the advice industry. Using an adviser is somewhat akin to listing your house as a private sale, only to contract a real estate agent to give you advice on how to do it!

There are certain things on this earth that are just not suitable for a DIY approach, (heart surgery immediately springs to mind!) but there are many others that are imminently suitable. An SMSF is surely one of these.

So maybe the decision you need to make is really “am I cut out for this” when considering the SMSF arena. If you don’t feel you have the knowledge, confidence or enthusiasm to involve yourself without the aid of adviser’s maybe you should step back a little and remain in the retail fund space.

Alternatively, why not avail yourself of the many courses available to hone your skills; investments in knowledge always give the best returns.

So before embarking on the SMSF journey think long and hard about whether you have the desire and all that entails, to control your retirement funds. For the right person an SMSF can be absolutely rewarding, sadly it can also be the opposite when we start to introduce an adviser into the equation.

I would be very interested in your comments, either good or bad, in regards your SMSF experience.