The interest of younger generations in self-managed superannuation funds is growing, as more young professionals start making long-term decisions about their futures. Those aged over 50 still account for the greatest number of SMSFs, but there are increasingly more 31 to 40-year-olds expressing interest in managing their own super. The demand from this age group has grown strongly over the past three years, according to an annual survey from the SMSF Professionals Association of Australia and Russell Investments. “They are interested in the longer term and have a good understanding of the short-term issues versus the longer term opportunity,” the report says. SPAA chief executive Andrea Slattery says the 31 to 40-year-old age group has witnessed “year-on-year growth”.
“The main reason for the growth is that people are becoming more educated, more aware and more interested in making their own decision knowing it’s for the long term,” she says.
“It’s not just for the immediate six to 12 months, it about saving for when they retire and then onwards. Many professionals and small business owners are at the age where they’re starting to seek professional advice for the long term.”
But despite the growth in younger generations, the overall number of people looking to establish an SMSF in the next five years has dropped from 17.3% to 12.3%, although over the longer term the figure is 14.2%.
Slattery says this is reflective of people becoming more educated about SMSFs.
“There is a real movement toward people who are genuinely interested and those who understand their needs and are making a conscious decision,” she says.
“There have still been a number of SMSFs established in the past 12 months in line with long-term trends set over the past 12 years, so this is reflecting people’s genuine intentions.”
READ MORE by Yolanda Redrup, Smart Company
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