SMSF

If you’ve got a Self Managed Super Fund (SMSF) or you’re thinking of controlling your own destiny by starting one, then you need to make the right investment decisions to increase your wealth and also protect it.

The burning question is “do you invest in shares or property?” The general consensus of experts is that when buying shares is that you should only buy blue chip shares with franked dividends, which become tax free once you turn 60 and you are in pension mode. The same applies to income received from property investments either residential or commercial.

But how do you make the right decision?

The main difference is that you can gear property into your SMSF i.e. if you buy a $1 million property and use $400,000 sitting in your super fund, the Trustees of the fund only borrow $600,000.

However you can’t gear up shares in a Self Managed Super Fund.  You can’t control a $1 million bundle of shares with only a $400,000 outlay – but you can in property.

So overall if you believe the gearing philosophy which could equate to additional growth and income, then property investments in your SMSF would be the best choice.