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