banter and General Discussion, page-1074

Apologies taken me a couple of days to have a tiny bit of spare time ...

A few important considerations regarding $1.6 Mill threshold for SMSF
1. Contribution stage (how many members are in this stage?)
2. Pension stage (how many members are in this stage?
3 Total number of members in the SMSF (maximum 4)
4. Individual balances and contributions into SMSF

Important because some members may still be contributing, some may be in draw down stage HOWEVER the individual balance is calculated on individual contributions ....so the actual balance of the super fund may be over the threshold however the question is what is the individual balances ....is that individual member over the $1.6 Mill at the point they enter pension stage ....if so yes they would have to redistribute their assets, such as taking a lumps sum so as only 1.6 Mill so as under their own individual balance

In terms of wealth distribution this is important as it's individual balances that determine the yearly draw down for each person in the pension phase.

For us we have two in pension phase and two in contribution stage....

Now we also have a Family Trust that is separate from the SMSF ....although Family Trusts in general do pay higher tax there is quite a bit of flexibility in distributions to beneficiaries ....so depending on Trust earnings can be distributed various ways.

For us having the trust allows effective management of both the SMSF and other family wealth that would have otherwise taken us over the SMSF threshold through the Trust. We also have to take into account individual earnings and holdings.

Priceless in assisting managing all this is for us to have great accounting advice ....we have both an expert in taxation and an expert in Super....yes that costs money every year however well worth it for us to know we are both compliant and meeting all requirements plus advice on the most effective practises to meet our requirements. Getting expert qualified help is worth its weight in gold not just in working out the initial change from contributing to pension but in also managing that after pension stage has commenced IMHO

One big thing to consider as age creeps up too is medical expenses and PBS safety net ....individual income affects this greatly ...so well worth looking into that if you have existing and ongoing medical issues that will require significant medical needs.

Just some thoughts apologies if I'm being brief just a bit pressed for time this week ....been organising my mum's hearing aids ....there you go one benefit of having decent cash flow and savings ....when such a large bill one off unexpected bill comes in it's not a concern and can be easily met

Hope all are well will be around when I can ....and of course none of this is advice just a very brief snippet of some of our strategies

Cheers all have a great day