Wednesday, August 27, 2008

Superannuation for the Self-Employed

For self-employed people to enjoy the benefits of superannuation or a self managed superannuation, they must make the payments themselves. Normally, the employer is the one who must make payments and this is compulsory. If you are self-employed, you are your own boss, so you have to make the payments. You may wonder if there is any use bothering, but self-employed contributions do attract significant tax savings. However, you will still need the services of an accountant as percentages and age limits seem to change every year.

There is a wide field of choice when it comes to super funds. When choosing a public fund from a bank or other financial institution or an insurance company, you need to carefully consider what fees they charge and what benefits they give. The reputation of the institution should also be taken into account. Choosing a rock solid reputation will give you peace of mind and ensure the success of your investments, there asset diversification can be similar to those you might see available in managed funds.

Public-offer funds such as those offered by banks give limited participation. You should be able to choose what level of risk you are comfortable with, though. That is, a high return but riskier investment strategy or a lower return but more dependable one. This is about all you can choose, as the trustee is the one who must make all other decisions.

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