Property Investments And Smsf

If you are an SMSF holder, it is always recommended to have a diverse portfolio

. In the case that one of your ventures should go awry, then at least you will still have your other investments to lean back on. If you invest large sums of your money into one stock or property, however, you could be taking a huge risk. Recently, many people have been finding more comfort in investing in some type of real estate, rather than in foreign currency, stocks or shares.

Many people did not think that they would ever have enough money to invest in such things as property. However, now that self managed super funds can be opened up by anyone with a savings of more than $150,000, it is becoming a lot easier. SMSF and property investment are tax effective and are an excellent way to set yourself up for asset protection.

Nonetheless, you must have an exceptional SMSF structure and investment plan in order to purchase property as a means of investment. Property investment through an SMSF is rather difficult to perform correctly, so you will need to speak at length to financial advisors and lawyers.

Obviously these consultations will incur additional fees, yet these financial advisors and lawyers will make sure that the property investment and SMSF is solid so that it does not jeopardise your self managed superannuation fund in the long run.

It is important that you comply to all of the laws that monitor property investment via an SMSF. One important thing to remember is that since this property investment serves as an asset, you cannot use this property to live in.

Essentially you can purchase the real estate and resell it for a higher price, which will automatically be deposited into your SMSF. Alternatively, you can lease out the property to individuals, families or businesses and this rental income will go directly into the super fund account as well.

Purchasing property via your SMSF can be an excellent investment strategy, if you are prepared. Property investment is not for everyone, but it is strongly advised that you speak to your financial advisor or accountant if it seems like a good investment strategy for you.

by: Julia Smith

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