How to Self-Manage Your Super: A Comprehensive Guide
18 March 2024
The financial planning team at the Freedom Planning office in Cairns

In the quest for greater control over retirement savings, many Australians are turning towards self-managed super funds (SMSFs). Managing a SMSF can be rewarding with tailored investment strategies and potential benefits.

However, it comes with its set of responsibilities and complexities. This article explains how to manage your super yourself. We discuss setting up an SMSF, knowing the sole purpose test, and understanding your responsibilities.
Setting Up an SMSF

The journey of self-managing your super begins with the setup of an SMSF. This process involves creating a trust structure, where the members of the SMSF are typically also the trustees, either as individuals or under a corporate trustee model. Establishing a trust deed is a critical step, as it outlines the fund’s operation, the members’ roles, and the legal framework within which the SMSF must operate.

Understanding the Sole Purpose Test

At the heart of SMSF management is adherence to the sole purpose test. This fundamental principle ensures that the SMSF is maintained for the primary purpose of providing retirement benefits to its members. The Australian Taxation Office (ATO) strictly enforces this rule, underscoring the importance of aligning all investment decisions with the objective of securing retirement savings.

Responsibility and Investment Strategy

Members of an SMSF are ultimately responsible for the fund’s decisions and compliance with super and tax laws. This includes devising a robust investment strategy that not only reflects the members’ risk tolerances and retirement goals but also complies with legal requirements. Investment options in an SMSF are vast, offering the potential to invest in shares, property, and other assets. However, these decisions should be made judiciously, keeping in mind the fund’s investment strategy and the need to diversify investments.

The Importance of Professional Advice

Navigating the complexities of an SMSF can be time-consuming and requires a solid understanding of financial and legal matters. This is where seeking professional advice becomes invaluable. A financial adviser can provide personalized guidance on investment options, while accountants and legal professionals can assist with compliance and the structuring of the fund.

Engaging with experts can help ensure that your SMSF operates efficiently and in accordance with the law.

Running Costs and Compliance

Managing an SMSF involves various running costs, including audit fees, legal fees, and the charges associated with investment management. Additionally, SMSF trustees must ensure their fund complies with super and tax laws, which can be both complex and time-consuming. The role of the corporate trustee is often seen as beneficial in this regard, offering a simplified governance structure and potential liability protection.

Benefits of a Self-Managed Super Fund

The advantages of self-managed super funds are manifold. SMSFs offer a level of control over retirement savings unmatched by traditional superannuation funds. Members can tailor their investment strategies, choose their investment options, and potentially lower their tax liabilities through strategic planning. Moreover, SMSFs can offer estate planning flexibility and the ability to pool resources with other members.


Self-managing your super via an SMSF offers significant benefits, from customized investment strategies to potential tax advantages. However, the decision to set up an SMSF should not be taken lightly. It requires a commitment to understanding super and tax laws, a willingness to take on the responsibilities of managing the fund, and often, a considerable time investment. By seeking professional advice and carefully considering the advantages and responsibilities, individuals can make informed decisions about whether an SMSF is right for their retirement savings strategy.