SMSF Property investing for Medical Practitioners

First, it’s important to understand what a SMSF is. A SMSF is a type of superannuation fund that is managed by the members themselves. SMSFs can have up to four members, and each member is a trustee of the fund. This means that SMSF members have greater control over their investments and can tailor their investments to their individual needs and preferences.

One of the main advantages of SMSFs is that they can invest in a wide range of assets, including property. Property is a popular investment choice for SMSF trustees, particularly in Australia where property has historically been a strong performer. However, it’s important to note that SMSF trustees need to comply with certain rules and regulations when investing in property.

For example, SMSFs can only invest in residential or commercial property that is used for business purposes. This means that SMSFs cannot use their funds to buy a holiday home or a residential property

As a GP, you may be interested in investing in property through an SMSF as a way to build your retirement savings. With an SMSF, you have greater control over your investments and can tailor your investment strategy to your individual needs and preferences.

Investing in property through an SMSF can offer a number of advantages for GPs. For example, property can be a stable and reliable investment that can provide steady rental income and long-term capital growth. Additionally, investing in property through an SMSF can offer tax benefits, such as the ability to claim deductions for expenses related to the property, and potentially lower capital gains tax rates. However, it’s important to note that investing in property through an SMSF is subject to strict rules and regulations. For example, the property must be purchased for investment purposes and not for personal use. Additionally, the property must meet the “sole purpose test” of providing retirement benefits to the members of the SMSF. This means that the property must be purchased with the intent of providing a long-term investment return for the SMSF, rather than for short-term gains.

Another important consideration when investing in property through an SMSF is that it can be a complex and time-consuming process. SMSF trustees must be aware of the rules and regulations surrounding property investment, including issues such as borrowing to purchase property, maintaining adequate insurance coverage, and ensuring that the property is managed in a way that complies with SMSF rules.

Ultimately, investing in property through an SMSF can be a suitable strategy for GPs who are willing to do their due diligence and are comfortable with the risks and complexities involved. As with any investment strategy, it’s important to seek professional advice and to carefully consider your individual circumstances and risk tolerance before making any investment decisions.

 According to the ATO, as of September 2021, there were over 598,000 SMSFs in Australia, with total assets of over $818 billion.
 As of June 2021, approximately 15% of SMSF assets were invested in real property, making it one of the most popular asset classes for SMSF investment.
 Over the past 10 years, Australian residential property has delivered an average annual return of 6.8%, according to research from CoreLogic.
 In 2019, the SMSF Association released a report showing that property was the second most popular asset class for SMSF trustees, behind Australian shares.
 A report by Investment Trends in 2020 found that 12% of SMSFs were planning to invest in property over the next 12 months.

It’s important to note that investing in property through an SMSF does come with some risks, including fluctuations in property values, the potential for rental income to fluctuate, and the complexity of managing an SMSF. As with any investment decision, it’s important to carefully consider your individual circumstances and seek professional advice before making any investment decisions.

Regards

Clients want to be lead, guided and pointed to the right direction by their trusted adviser. Together with other financial professionals, I help my clients enjoy their life by providing a safety net and a peace of mind about their financial future.

Teamwork makes for Dreamwork

Managing a team of people takes some skill, patience and a lot of hard work. But the rewards are forthcoming once your employees and systems are set in place.

In my financial planning business, I talk to many companies that are faced with high staff turnover. They sometimes seem surprised when staff leave, yet there are always indicators of dissatisfaction, they seem to just ignore the signs.

I believe one of the main issues is the perspective of the staff. Are they a cost or an asset?
For most businesses, staff are the biggest cost on the P&L, but that is an accounting treatment. Try thinking of your staff as the core of the business value. Without your staff running the core assets like IT, systems and processes, there would be no business.

What you value will only appreciate and your staff will go to the company that values them the most.

This is not a new concept in management teaching, but how do you really feel about staff? If you don’t really appreciate them it will show in your actions. You cannot fake it. I was recently on a business trip in Sri Lanka, working alongside my extended team that assist me to run my financial planning business. I was also hiring and training my new staff who run other financial outsourcing practices.

I am investing my time and energy in these new team members and they appreciate it. If I calculate all the time I spent developing my team and processes it would be more than 400 hours in the last year alone!

That’s a strong signal to the team that I care. It shows in their loyalty, work ethic and care towards my clientele.
In a market where loyalty is scarce, people will stay where they feel valued, so value them. Celebrating special events like birthdays, paying for company social events and recognising staff efforts all help your cause.
Being a business owner is a tough role to undertake. However, a strong team behind you will only enhance your business operations and success. As the old adage states ‘A little kindness can take you a long way.’

Next blog I will be discussing SMSF property investing for medical practitioners.

Regards

Clients want to be lead, guided and pointed to the right direction by their trusted adviser. Together with other financial professionals, I help my clients enjoy their life by providing a safety net and a peace of mind about their financial future.

Do Doctors need to have an Self Managed Super Funds(SMSF)?

I was recently at a medical conference in Melbourne and I talked to dozens of medical professionals about their financial situations. One topic that came up a lot was Self Managed Super Funds (SMSF) and if it was suitable for them. Let me explain.

A self-managed super funds (SMSF) is a private super fund that you manage yourself. SMSFs are different to industry and retail super funds. When you manage your own super, you put the money you would normally put in a retail or industry super fund into your own SMSF. You choose the investments and the insurance.

Given that it is a pretty sophisticated instrument and the advice differs for each person’s circumstances I thought I would approach the topic by answering the most common questions I get about SMSFs and how they can relate to medical professionals specifically.

1. How much super do you need to justify? (Google these answers)
2. Is it more tax effective?
3. Can you purchase a property?
4. How do you get a loan?
5. How does capital gains tax work?
6. Is it expensive to run?
7. Is it a good choice for medical professionals?

These are the most asked questions I get but if you have other questions please message me and I will do my best to answer them for you. The bottom line is, if you want the flexibility and control to add a property to your portfolio an SMSF is a good choice.

Next blog I will be discussing tax-effective investments so keep subscribed for that information.

Regards

Clients want to be lead, guided and pointed to the right direction by their trusted adviser. Together with other financial professionals, I help my clients enjoy their life by providing a safety net and a peace of mind about their financial future.

Take a moment to design your life, not just build your business

With January flying, It is at these times of year that we tend to calibrate where we are in our lives, good and bad, setting many goals for the year ahead.

Working with many successful clients in my Dreamwealth Financial Strategists businesses I help them with their wealth creation and tax planning, but we also discuss lifestyle. The main goal for most of my connections is not just financial independence, it’s the health, friends and time to enjoy it.

My friends have seen all the holidays I have every year, in fact, my goal is to take at least 8 weeks of vacation and visit four new countries every year (the picture is from a past trip to South America). To do this and keep growing your business and revenue takes planning and dedication to your goals. But it’s definitely worth it!

Your lifestyle goals may be different to mine, perhaps you want more time with your kids, more time for hobbies or just more downtime. Whatever your goals you need a plan.

In my future blogs, I will detail my step by step process I have used to achieve my desired lifestyle and the tips and techniques I apply to my clients.

Let’s plan for a more adventurous 2023 and start the journey together.

How do busy medical professionals build wealth with limited time ?

Working with super busy professionals over the last 15 years has honed my financial planning strategies for people just like you.

I understand that when a General Practitioner calls me, they want to get down to business as they have limited time to waste. They want practical advice on how to generate wealth that is not too risky and is easy to understand.

That’s why Australians love investing in property. It has been such a successful strategy for many people as it’s dependable, tax effective and relatively easy to acquire. People can easily understand the investment and feel secure in their decisions. But is it the right time for a property in your portfolio?

We live in uncertain times and new investment vehicles such as crypto have not held up to market scrutiny, shares have been quite volatile but property seems to hold firm year after year. It does fluctuate, but not as rapidly as other investments as people always need somewhere to live.

Not many financial advisors work with this asset class as it’s more work and effort for them, but their clients miss out. I think most portfolios should include some element of property to be complete. It reduces risk and maximises value.

That’s why I have specialised in creating a systemised and simple process for my clients. It involves setting up a Self Managed Super Fund, understanding your tax situation and also asset protection strategies to make sure it’s the best fit for your situation.

In future blogs, I will address all of these items so make sure you are subscribed to get all of the information.

Alternatively, if you are ready to discuss your specific needs send me a message to see if you qualify for a free financial health check valued at $497. Otherwise, I look forward to helping you get into your next property investment.

Regards

Clients want to be lead, guided and pointed to the right direction by their trusted adviser. Together with other financial professionals, I help my clients enjoy their life by providing a safety net and a peace of mind about their financial future.