Two important questions that will help you self-manage your super funds


There are more than 600,000 self-managed super funds (SMSF) with total estimated assets of around $876 billion, which accounts for almost 25% of all superannuation funds,according to a recent report from the Australian Tax Office.

The ATO also reported that more than 50% of SMSFs were set up more than 10 years ago and the establishment of new SMSFs has been on the decline for several years. So, is this a sign that investors no longer want control of their investments?

We need to remember that the vast majority of growth in SMSFs came after the GFC crash, as so many were disenchanted with their managed fund returns and advisors telling investors to hold for the long term. For many, it was a hard pill to swallow as they were sitting on portfolios that had fallen 50 to 70%.

two questions to ask super

As the market runs on cycles, I am confident that we will see another sustained market fall in the second half of this decade. When this occurs, unfortunately investors will repeat the mistakes of the past and watch their industry superannuation fall away heavily again and the cycle will continue with a large number setting up a SMSF.

Right now, around 28% of all SMSFs funds are invested in listed shares, which means they are important to our stock market, but the industry continues to propagate that SMFS are too hard to manage and too costly to run, although in my experience, it is the exact opposite. There are many providers with low cost services that assist SMSF trustees to set up and properly manage an SMSF and with a good education, anyone can achieve solid returns on their superannuation that either rival or beat many of the managed fund returns.

The streets are littered with those who make decisions after a major event that costs them dearly, but surely the wise thing to do right now is to ask yourself these two questions. What if and how? What if the market falls heavily? And how will I protect my superannuation? Remember if you fail to plan you plan to fail.

The best and worst performing sectors this week

The best performing sectors include Financials, Utilities and Consumer Staples, which are all currently up under 1% for the week. The worst performing sectors include Information Technology and Healthcare, which are down more than 1% followed by Consumer Discretionary, as it is down just under 1%.

The best performers in the S&P/ASX top 100 stocks include Northern Star Resources up more than 6% followed by Evolution Mining up over 5% and AMP up more than 4%. The worst performing stocks include The a2 Milk company down more than 8% followed by Pilbara Minerals down more than 7%, while ResMed and Fisher & Paykel Healthcare are both down more than 5%.

What's next for the Australian stock market

This week and next are short weeks on the Australian market given that it is Easter, and typically volumes are lower because many of us take holidays around this time. That said, the All Ordinaries Index started the week on a positive note again trending up before showing some weakness. Unlike the previous week, however, regardless of where the market closes on Thursday, this week is technically a down week.

This is a good sign and in line with what I mentioned in my previous report where I stated that the All Ordinaries Index would likely fall to around 7600 points. Given this, don't be surprised if next week is also a down week on our market although there is a possibility that it could also rise.

For now, it is wise to play the wait-and-see game until the Australian stock market finds support and starts to rise, as recent history shows that anything is possible in our market and that we need to expect the unexpected. I am still confident once we find support that the market will rise up into April and well into May before we see the next peak.

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Dale Gillham is chief investment analyst at Wealth Within Limited (AFSL 226347). He also serves as the head trainer at the Wealth Within Institute (RTO 21917). He has more than three decades of experience in the investment industry, and is the author of How to Beat the Managed Funds by 20%, Dale's qualifications include an Advanced Diploma and a Diploma of Share Trading and Investment. He co-hosts the Talking Wealth Podcast, and his work has appeared in The Australian Financial Review, New York Business Journal, Wall Street Select and more.