The ATO has just released its latest self managed super fund bulletin and it confirms the stellar growth for the sector is continuing unabated.
According to the report, at the end of December last year there were 496,207 SMSFs and 945,207 SMSF members, a rise in both funds and membership of 7.8% over the previous 12 months.
The fund number growth means a net 3,000 SMSFs are being established every month, that’s 100 daily and around four every single hour.
This growth is reinforced by the number of SMSF wind-ups during 2012 at 3,644 being about half the number of the year before when 6,403 SMSFs were wound-up.
However, the bigger concern for the regular superannuation segment is that much of this frenetic interest in SMSFs is being driven by gen-X and gen-Y investors who now make up 71% of new SMSF members – even though people aged 55 years or older still make up 61% of all SMSF members.
While 13% of households have gross incomes above $150,000, 19% of SMSF members are estimated to have taxable incomes above $150,000.
According to separate figures from APRA, SMSFs manage $484 billion in assets and account for 33% of the $1.463 trillion in combined superannuation savings.
These figures suggest that younger upwardly mobile, aspirational and financially savvy wealth creators embracing SMSFs – and by association direct investment – are a major strategic threat to the wealth management industry which in years past would have relied on them to fuel future profitability.
By Alex Dunnin