Warning – undiversified SMSFs with one asset could face being sued by beneficiaries

Asset for SMSFs undiversified SMSFs with one asset could face being sued by beneficiaries

Assets in SMSFs undiversified SMSFs with one asset could face being sued by beneficiaries

Self-managed superannuation fund (SMSF) trustees run the risk of being sued when undiversified SMSFs have one asset. If a fund is invested in only one asset or class of assets, beneficiaries can claim it prevented a higher return.

“Though trustees did not properly diversify the SMSF but still made money, beneficiaries are popping up years down the track and claiming that had the trustee invested in an index fund or [used] modern portfolio theory, they would’ve had more money,” DBA Lawyers senior associate Bryce Figot told InvestorDaily. “Therefore, they are suing for the difference. It doesn’t really get much airplay so a lot of trustees don’t know that there is essentially a duty to diversify, unless your trust deed says you don’t have to diversify.” Krystine Lumanta, Investor Daily


About SuperBenefitnews

Self-Managed Superannuation Service Providers in Australia. SuperBenefit provides a wholistic SMSF assistance, education and administration service continuum - 1. “assistance” is help of whatsoever nature where our overall SMSF experience and knowledge enables us to provide assistance/help without any legal (or “license”) limitations. 2. “education” involves providing knowledge through teaching, coaching and mentoring about all matters SMSF, including (but not limited to) investment issues such as equities and property, 3. “administration” encompasses all admin aspects of legally required SMSF trustee and member record keeping including (but not limited to) audit and ATO matters. In keeping with our key point that SuperBenefit does not provide Financial Advice, where issues arise from 1, 2, and/or 3 above Indicate a need for a legally authorized provider (such as a Financial Adviser) and the client does not have their own service provider, the client can utilize SuperBenefit’s ‘Connect Assist’ … SuperBenefit, in itself, does not provide Financial Advice, but it does provide the wherewithal for great SMSF service. WE do not provide Financial Advice or any other service that requires a legally authorized provider. However, where such advice or service is required we have our ‘Connect Assist’, a SuperBenefit resource we use to connect clients to a Licensed Advisor or other legally authorised service provider. Call us 0407 361 596, no obligation FREE Connection call to see how we can help you!
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