self managed super, page-29

I cant believe how old this post is and how long it has gone on so on that basis I will add my 2cents worth.

I have had my SMSF up and running for 18months now. Moved it across from Australian Super just as the GFC started to happen, and ever so glad that I did.

The biggest problem I found with the whole SuperFund thing was the automatic buy/sell method (almost robotic) and being stuck within the limited asx range of shares open to trade.

Since I have moved across to my SMSF I have worked on the basis that I have 20 odd years left before I need to call on my fund.

This allowed me to set aside as part of my trading outlook to look 'outside the square' and use 40% of my fund to invest in non-ASX200 shares.

This has resulted in my biggest gains (+50% across the board) to date. Those that I feel will be future dividend payers I freecarry, WDR is the best example now being 4x my inital investment. The others I sell at min 50% profit.

I have never run a 'stop loss' on these as they can move in and out of profit so easily, to date this has proved to be a correct move.

Usually these sales fall within '12months rule' of ownership but I fell that even with the extra tax this is well worth the effort - a profit is a profit.

The other 60% is split between under valued companies (asx200) that pay a dividend. This I feel is important as it might take a couple of years before I achive a 40% min capital gain to take a profit. If I can get 3-6% dividend/year till this occours then it only adds value to the final sale.

Surprise surprise from this GFC has resulted in me now freecarry on WOR, MCC and LEI. Got my 100%+ on the investment and now paying a dividend on the profit. These I will pretty much keep until the day I die, and will take any drop in price to buy back in.

As for the admin side of things. If you are used to trading shares then this should be no big deal. Esuperfund takes the records from the bank and broker and prepare the paperwork based on this. The only thing I need to do is to advise them of is off-market purchases, off which there has been a few due to the GFC and companies rasing money left right and centre. I use a simple spread sheet to keep track of shares traded and how this relates to money coming and going in the bank account.

They dont do real property (boo hoo)so this makes things pretty straight forward.

As to people who break the rules. I read the ATO emails, and stories on other web sites.....really pretty straight forward rules folks....
1) dont lend money to yourself, business, family....in fact just dont lend money. Pretty obvious I would have thought.
2) can not personally benifit. No discount cards, shareholder offers etc.....you can not take up anything that is to your benifit no matter how good it looks. This bit sucks, so many goodies out there.
3) cant live in a property that your fund owns. Now that would be cool! pay rent into your own fund, that would rock!
4) cant buy a property that your business operates from unless at market value.
5) basically if you can benifit in any way shape or form then it probably aint allowed.

So to sum up - if you can find someone to do all the paperwork and set the sucker up for you, do your annual return, can keep track of what investments you do, then go for it and you should do better than the super funds.