Latest SMSF Sector Insights*

Statistical overview

Sector size

In 2017-18, there were 25,034 SMSF establishments and 10,529 SMSF windups. As such, at 30 June 2018, there were 596,225 SMSFs, with 1,118,650 SMSF members, holding $749.9 billion in assets.

Age distribution

At 30 June 2018, the average and median SMSF age was 10 years.

Contributions

In 2016–17:

• The total contributions to SMSFs were $41.8 billion, of which $34.7 billion was member contributions and $7.1 billion was employer contributions.
• The total average and median member contributions to an SMSF was $133,061 and $30,000, respectively. Whereas, the total average and median employer contributions to an SMSF was $24,976 and $19,155, respectively.
• The majority of the total contributions to SMSFs were made by (member, 81.3%), and on behalf of (employer, 83.3%), those aged 50-69.

Benefit payments

In 2016-17, total benefit payments from SMSFs were $46.4 billion:

• The average and median benefit payment per SMSF was $144,987 and $67,380, respectively.
• The average and median benefit payment per SMSF member was $94,290 and $42,000, respectively.
• 86.9% of all benefit payments were in the form of an income stream (including transition to retirement income streams).
• 91.5% of SMSF members receiving benefit payments were aged 60+.

Payment phase

In 2016-17:

• 57.6% of SMSFs were solely in accumulation phase.
• 31.6% of SMSFs were solely in pension phase.
• 10.8% of SMSFs were in partial accumulation and pension phase.

Trustee structure

At 30 June 2018, 58.9% of all SMSFs had a corporate trustee (rather than individual trustees).

Member gender/age

At 30 June 2018:

• 53% of SMSF members were male, and 47% were female.
• The median age for SMSF members was 59.4 years; however, the median age of SMSF members of newly established funds in 2016–17 was 47.6 years.

Member number

At 30 June 2017, 70% of SMSFs had two members.

Member balances

At 30 June 2017, the average and median SMSF member balance was $640,191 and $296,721, respectively.

Asset size

At 30 June 2017:

• The average and median assets per SMSF were $1,223,460 and $693,265, respectively.
• The average and median assets per SMSF member were $652,465 and $393,141, respectively.
• 47.6% of SMSFs held assets of between $200,001 and $1 million, accounting for 20.9% of total SMSF assets.
• SMSFs established in 2016–17 had average assets of $521,373.

Asset allocation

At 30 June 2017, the top five assets held by SMSFs (by value) were listed shares (29.1%), cash and term deposits (23.4%), unlisted trusts (10.6%), non-residential real property (9.2%), and limited recourse borrowing arrangements (LBRA) (5.3%).

Asset concentration

At 30 June 2017, 43.6% of SMSFs held 80% of their assets in one particular asset class, representing 28.9% of total SMSF assets.

LBRA assets

At 30 June 2017, 8.9% of SMSFs reported LRBA assets, of which 93.2% consisted of real property.

Borrowing

At 30 June 2017, borrowing represented 2.9% of total SMSF assets, and the average amount borrowed was $368,210.

Investment return

In 2016–17, the average return on assets for SMSFs was 10.2%.

Expenses

In 2016-17:

• The average total expense ratio (administration and operating expenses 0.66%, and investment expenses 0.51%) of SMSFs was 1.17%.
• The average total expense ratio for SMSFs generally declined as the fund size increased. For example, SMSFs with a size of >$200,000 to $500,000 had an average total expense ratio of 3.4%, whereas it was 1.0% for those with >$1m to $2m.

Contraventions

Up to 30 June 2018, the top three contraventions by SMSFs (as a proportion of the number of contraventions) were loans and financial assistance to members (21.2%), in-house (related party) assets exceeding 5%  (18.8%), and failing to keep the SMSF assets separate to personal or business assets (12.9%).