What can I invest in with my SMSF?

Ensure your SMSF investment strategy is set up

A self-managed super fund offers investors significant control over their retirement savings. Creating an effective investment strategy is important to leverage the advantages a self-managed super fund provides. 

It's not enough to allocate funds broadly across asset classes – like setting ranges from 0% to 100%. You must carefully plan how your fund will meet your retirement goals.

An SMSF investment strategy should outline the percentage or dollar allocation for each asset class, ensuring your decisions support your long-term objectives. If you prefer not to list these allocations, specifying material assets is essential, along with the rationale behind them.

SMSFs have diverse investment options, like cash, shares, property, and more that are covered below. This flexibility allows you to begin conservatively, and later expand to other assets as your financial landscape evolves.

At the core, a well-crafted SMSF strategy empowers you to tailor your financial path, taking steps towards a rewarding retirement journey.

What can a self-managed super fund invest in?

Trustees of a self-managed super fund are free to choose what they invest in, selecting from a range of assets including:

1. Australian shares and ETFs
2. International shares and ETFs
3. Over-the-counter stocks
4. Residential and commercial property
5. Managed funds
6. Precious metals
7. Collectables
8. Venture capital funds
9. Startups & VC
10. Cash and term deposits
11. Bonds
12. Cryptocurrency

Refer to the Stake Super package which best suits your asset allocation.

Considerations before investing in an asset

When considering investments within your self-managed super fund, it's crucial to ensure that all assets remain distinct from the personal assets of its members. This separation helps maintain clarity in ownership and prevents potential legal complications.

• All investments should clearly reflect their market value, ensuring fairness and transparency.
• Transactions must adhere to the arm’s length principle. This means that any transaction should be conducted as if between unrelated parties, ensuring no collusion and maintaining fair dealings. 
• It's essential that these investments are not used to provide financial assistance to members or their relatives. Such actions could lead to severe penalties, including disqualification as a trustee.
• The sole aim of any investment should be to provide retirement benefits to members. This aligns with the Superannuation Industry (Supervision) or SIS Act.
• When investing, it's important to follow the rules on prohibited loans and in-house assets, among others. Breaching these super laws can lead to compliance actions against you, including hefty penalties. Ensure your trust deed permits such investments and that they meet what's known as the sole purpose test.
• Diversification is another essential consideration. While you may be tempted to allocate most of your retirement savings into a single asset, doing so can introduce concentration risk. A diversified portfolio can help spread and mitigate risks related to returns, volatility, and liquidity.

Have questions for our SMSF professionals?

This is not financial product advice, nor a recommendation that a self-managed super fund (‘SMSF’) may be suitable for you. Your personal circumstances have not been taken into account. SMSFs have different risks and features compared to traditional superannuation funds regulated by the Australian Prudential Regulation Authority (‘APRA’). Stake SMSF Pty Ltd, trading as Stake Super, is not licensed to provide financial product advice under the Corporations Act. This specifically applies to any financial products which are established if you instruct Stake Super to set up an SMSF. When you sign up to Stake Super, you are contracting with Stake SMSF Pty Ltd who will assist in the establishment and administration of an SMSF under a ‘no advice model’. You will also be referred to Stakeshop Pty Ltd to enable your trading account and bank account to be set up in order to use the Stake Website and/or App. For more information about SMSFs, see our SMSF Risks page.