Help! Is my self managed super fund safe?

Dear Aunty B,

I read your comments in your Q&A regarding deposits in Australian banks, which are safe for thee years.

But does that also apply to my self managed super fund? I have all monies invested in the funds name, in a “term deposit” with the bank.

Don S,
Sydney

Dear Don,

Of course, they are safe. They are deposits!

Self-managed super fund experts Vanguard Investments put it well: “Whether it is invested in your name or your self-managed super fund should not make any difference – it is the deposit (not the vehicle that you own it through) that the Government is guaranteeing,” says Robin Bowerman, principal of retail at Vanguard.

If you want a list of the banks and institutions covered by the guarantee go to APRA‘s website.

But one thing Don, while I have your ear. The PwC business barometer was out yesterday. Read our report here.

Of particular note was how many private enterprises between $1 million to $100 million turnover have their own self-managed super fund. It is now a whopping 42%!

I am surprised it is that high. So was PwC partner Gregory Will, who says he thought it was high for tax reasons but was surprised to find it was because these entrepreneurs want a hands-on role in managing investments.

As we all know, these are volatile times. Those of you with self-managed super funds need to stay very informed and take expert, unbiased and honest advice from people who have up to date knowledge in all fields. What is the hardest part of going forward is not being spooked by fear, and working out the long term trends shaping the economy and markets.

That’s hard at present when you are trying to steer your company through unchartered territory at the same time. So make sure you have effective management of your portfolios and are taking good advice – and voice your concerns if you don’t think your advisers are on top of it!

Good luck,

Your Aunty B.