SMSF advisers targeting Gen Y

Half of advisers are targeting younger accumulators and small business owners to establish a self-managed superannuation fund (SMSF), according to a SMSF report said.

The ‘Intimate with Self-Managed Superannuation' annual report by Core Data, for nabtrade and the SMSF Association, has found SMSF advisers increased their target on new client types by 5.7 per cent in 2014 from 2013.

The report found 8.1 per cent of non-trustees are likely to consider establishing an SMSF in the next two years, 9.6 per cent in the next two to five years, and 13.2 per cent in more than five years.

Close to two-thirds of advisers also expect an increase in the number of SMSF being established over the next 12 months.

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Core Data found one in five advisers experienced an increase in SMSF demand from 20 to 30 year olds.

SMSF Association's chief executive, Andrea Slattery, said the younger generation is a very large sector of growth for SMSFs.

"There is a significant increase in the ages of 20 to 30 that are interested in being engaged, and interested in [SMSF] information," Slattery said.

"Most of the barriers are that they don't have enough information. They're a very large opportunity for growth."

nabtrade's head of SMSF solutions, Gemma Dale, said there were Gen Ys who although did not have enough for a SMSF starting balance very interested in starting a SMSF due to the opportunity to invest in something they could not access through a standard fund.

The report noted that 75 per cent of those in the same age bracket that derive asset allocation and investment strategies with support from an adviser prefer to have one professional services relationship that covers all their needs.

However, trustees were still found to ‘call the shots' but were increasingly relying on advice from advisers to derive strategies and investment expertise.