pms and superannuation funds, page-5

Hi Guys,

I have run my own SMSF for many years and have found no problem with holding physical gold in the fund.

In fact because of my concerns and general distrust of banks etc. gold and silver in physical terms are the main holding in my fund.

The auditors of my scheme have not had problems with my fund holding gold they do require that it is stored correctly and safely. I use a local vault service and the fund pays the storage bill. Around every three years they require a physical audit. I maintain a list of the bar numbers and all copies of purchase and now and again sales invoices, my local bullion dealer confirms the bullion value and the auditors and ATO are all satisfied. More important than all that I get to sleep easy at night.

I would say the main thing is keeping good records. In the past I have purchased gold for my fund from my personal holdings all you need do is prove this was purchased at the correct price on the day. I normally print out the Kitco page to show the AUD price on the transaction day and staple this onto a typed invoice.

In the past the fund auditing company and their external accountants have cautioned me about all eggs in one basket etc. However, I remain adamant with them and tell them in my capacity as trustee for the scheme I am doing the best I can to protect the only fund members interest. For the last few years when I prepare the fund paper work for the auditors I print off the Kitco ten year graph and include it with the other documents.

It has now been 4-5 years since anyone dealing with my fund has cautioned me about its particular choice of investments. The owner of the auditing company is now a physical metal purchaser in his own right.

Another point of interest I met with my fund auditors this week to finish of the 2009-10 tax year return and as he meets many people running their own funds I asked if he was hearing about growing interest in buying gold and silver. I was surprised at his response when he told me it was not even close to being on the radar for the group he mixes with professionally or otherwise.

I get the general impression that many people with their own funds are starting to realize that retirement age is creeping up on them quickly and they are aware that their funds are not sufficient to support them. This is leading to more risks being taken as they go into catch up mode.

Another scary thing about superannuation is how much the average person currently has stored away for retirement in particular those over forty five years of age. It is not a comforting thought.

This is my personal experience and I hope it answers a few questions for anyone interested.

Cheers: Andy