Westpac believes that, the potential of the Self-Managed Super Fund market is clearly very significant as Superannuation in this country is worth about $1.3trn, of which about a third sits in SMSFs.
With the expectation to double in size over the next 10 years, so by 2022 we are looking at about $800bn in assets it's very, very significant.
Looking at the raw figures, it is not surprising that lenders have been falling over themselves to launch into the SMSF market as they try to balance their Mortgage loans portfolio, as this will lower the proportion of Loans with Mortgage Arrears.
As this will also remove any Mortgage from the Individuals Assets & Liabilities reports, this could assist with any clients who may require Debt Consolidation.
Lenders over the last two years have instigated a myriad of Investment & Loan products, as they are encouraged by the Australian Taxation Office clarifying its stance on these funds.
The result is a fast-expanding universe , one in which brokers could have a central role as SMSFs have become much more mainstream among superannuation clients due to the Trustees looking for diversified investments, and there has been a very strong penchant for property in this country.
There are about 900,000 Australians who are members of an SMSF and it has certainly become more mainstream with the acronym being now better understood and it is a taste that is being propelled further by the lackluster performance of share markets.
With flat interest rates and equities flat as well, people are looking to other asset classes to invest their money into for long-term investments, and good returns out of property have been demonstrated in the past.
The products fit with a long-term preference for property among Australian investors as Property has long been a cornerstone of retirement strategies.
“People take comfort in bricks and mortar, an asset that they can see and touch. Property is something that people are comfortable with, and since borrowing to invest through super was introduced, a whole new way of investing in property for retirement has become available.”
The two key emotional drivers are control and flexibility as you've got clients who want to take greater control of their retirement savings and they are also looking for greater flexibility of what they have to invest into.
In terms of the origination process itself, there is a little bit more rigour and compliance around it, but the process is by and large the same as borrowing money for any other investment property lending and Lenders certainly want to understand who they we are lending money to, and how the money will be paid back.
The most important thing is knowing where the line is in the delineation between advice, and the knowing customers have spoken to their financial planner ,their accountant and Finance Broker to ensure that an SMSF and the product on offer, is most appropriate for them, so they are able to provide clients with best-in-class service.
The ever changing Landscape needs potential clients to research extensively the potential for this solution which has great potential benefits.
Extract from the Australian Broker Magazine September 2012 edition
With the expectation to double in size over the next 10 years, so by 2022 we are looking at about $800bn in assets it's very, very significant.
Looking at the raw figures, it is not surprising that lenders have been falling over themselves to launch into the SMSF market as they try to balance their Mortgage loans portfolio, as this will lower the proportion of Loans with Mortgage Arrears.
As this will also remove any Mortgage from the Individuals Assets & Liabilities reports, this could assist with any clients who may require Debt Consolidation.
Lenders over the last two years have instigated a myriad of Investment & Loan products, as they are encouraged by the Australian Taxation Office clarifying its stance on these funds.
The result is a fast-expanding universe , one in which brokers could have a central role as SMSFs have become much more mainstream among superannuation clients due to the Trustees looking for diversified investments, and there has been a very strong penchant for property in this country.
There are about 900,000 Australians who are members of an SMSF and it has certainly become more mainstream with the acronym being now better understood and it is a taste that is being propelled further by the lackluster performance of share markets.
With flat interest rates and equities flat as well, people are looking to other asset classes to invest their money into for long-term investments, and good returns out of property have been demonstrated in the past.
The products fit with a long-term preference for property among Australian investors as Property has long been a cornerstone of retirement strategies.
“People take comfort in bricks and mortar, an asset that they can see and touch. Property is something that people are comfortable with, and since borrowing to invest through super was introduced, a whole new way of investing in property for retirement has become available.”
The two key emotional drivers are control and flexibility as you've got clients who want to take greater control of their retirement savings and they are also looking for greater flexibility of what they have to invest into.
In terms of the origination process itself, there is a little bit more rigour and compliance around it, but the process is by and large the same as borrowing money for any other investment property lending and Lenders certainly want to understand who they we are lending money to, and how the money will be paid back.
The most important thing is knowing where the line is in the delineation between advice, and the knowing customers have spoken to their financial planner ,their accountant and Finance Broker to ensure that an SMSF and the product on offer, is most appropriate for them, so they are able to provide clients with best-in-class service.
The ever changing Landscape needs potential clients to research extensively the potential for this solution which has great potential benefits.
Extract from the Australian Broker Magazine September 2012 edition
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