Macquarie Adviser Services SMSF trends in cash and lending Insights from the SPAA SMSF Generations Report and the 2012 Macquarie Mortgages Roadshow Prepared for Premium Wealth Management November 2012
Macquarie Adviser Services SMSF trends in cash and lending Insights from the SPAA SMSF Generations Report and the 2012 Macquarie Mortgages Roadshow Prepared.
Dec 24, 2015
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Macquarie Adviser Services
SMSF trends in cash and lending
Insights from the SPAA SMSF Generations Report and the 2012 Macquarie Mortgages Roadshow
Prepared for Premium Wealth Management November 2012
Macquarie Adviser Services
The SMSF Market
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Who is in the market for an SMSF?
Small business owners
Younger people Highly educated
Families with school age and pre-school children
White collar professionals
People from Asian
backgrounds
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We need to understand confidence
Totally confidentLittle or no confidence
Plan to set up SMSF
Plan to invest in property
Plan to buy a house
Have set up SMSF
Have invested in property
Have bought a house
If they’ve done it before they will be full of confidence
but if not you’ll need to support
them. Women are often less confident
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What gives them confidence?
All this before
they get to you
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No such thing as a typical SMSF investor
Choice and control drive sector growth
Source: Macquarie – Mood, Life and Money survey, 2011
• 9% of Australianssurveyed have established an SMSF
• 14% likely to in future
Extract from: SPAA SMSF Generations Report
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Cash and the SMSF investor
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Cash: the asset allocation decision
Last five years have seen an increase in the proportion of SMSF assets held in direct shares, cash investments and
geared property.
*Based on Macquarie Cash Management Account and Macquarie Cash Management Trust data.
Cash investments
Managed funds
Direct shares
Geared property
2006 2011
Extract from: SPAA SMSF Generations Report
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Seasonality of deposits: a movable feast
• Noticeable peak of deposits each June• Hands on approach taken • Preference for funds transfer, cheques in decline
No such thing as a typical investor, except when it comes to transacting.
*Based on Macquarie Cash Management Account and Macquarie Cash Management Trust data.
Simple super
Extract from: SPAA SMSF Generations Report
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Wrap portfolios: a focus on equities
Gen Y SMSF investors – highest allocation to equities at 48%
*Based on Macquarie Wrap data. Extract from: SPAA SMSF
Generations Report
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Generations: at a glance
* Investment Trends, April 2012 Self Managed Super Fund: Investor Report, additional analysis commissioned by Macquarie Bank.^ Macquarie Bank. Based on Macquarie Cash Management Account data.† Mood, Life and Money – Macquarie Insights.
Extract from: SPAA SMSF Generations Report
⌂
⌂ Caution- based on very small sample
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Tailoring advice is key
Source: Macquarie – Mood, Life and Money survey, 2011Extract from: SPAA SMSF
Generations Report
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Role of advice: never more important
Information hungry and knowledgeable
Number one preference on receiving advice is face-to-face meeting with an expert, followed by a written recommendation.
Source: Macquarie – Mood, Life and Money survey, 2011Extract from: SPAA SMSF Generations Report
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The Property Story
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SMSF growth 1994-2011
% of super industry assets
Money in corporate super funds
Money in public sector funds
Money in industry super funds
Money in retail super funds
Money in self managed funds
$54 billion
$205 billion
$247 billion
$358 billion
$400 billion
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Property slice of SMSFs currently ‘small’
14.5% in property made up of 4.5% direct residential, 6.3% direct commercial
and the remainder in property trusts
There is $58 billion invested in property in self managed super
funds
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What does $58 billion buy?
58 times the amount spent by tourists to see koalas every year
116 years supply of bottled water purchased in Australia
The amount of debt Generation Y have racked up on credit cards
The entire currency reserves of Iraq
The cost of actually paying for all of the pirated music each year
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Mean balance of SMSFs
Median balance of
SMSFs $525,000
Average value of
property in SMSFs $76,125
100% of this block in St
Arnaud Victoria
50% of this house in
Tailem Bend SA
25% of this house in Dawesville WA
60% of this unit in Ayr
Queensland
10% of this house in Bayview
Heights Sydney
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Will property play a role in SMSF growth?
Nic Ellis, CEO of SuperShift, a SMSF property specialist SMH March 24th 2012
...one of the real headline grabbers that should be in the eye of the public is the rise of SMSFs and just how property as the new preferred asset class, is guiding average Australians out of the quagmire of the GFC.
..but the current appetite for borrowing particularly within SMSFs is low
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…and things can go wrong
24%
26%
50%
One of the worst
decisions I’ve made
OK but could have been
better One of the best decisions I’ve
made
I lost money It was too complicated It was too much hard
work
I’ve downsized I’ve delayed having a family
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In conclusion
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What can you do to make the most of the SMSF trend?
Study the SMSF rule book 1
Introduce SMSF language with clients and suppliers
2
Add value through knowledge enhancement
3
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