In its recent review of SMSF advice, ASIC identified a range of areas that should be improved as advice is given, according to Property Observer.
Guidelines have now been issued by ASIC highlighting the areas that investors and advice providers should consider and discuss prior to setting up a SMSF.
The guidelines present a range of practical tips that can be applied by advice providers to ensure better quality advice is imparted to investors.
A scenario was provided by ASIC, together with the advice most appropriate for a SMSF making a real property investment. The scenario involved a couple aged in their early 50s being given advice about establishing a SMSF.
The guided scenario included an advice provider discussing a range of investment options and asset classes available to the SMSF. In this scenario, the investors advised that as they were experienced property investors, they wanted to channel their superannuation savings into the purchase of another investment property.
Following further inquiries made by the advice provider, a number of issues were identified that ultimately led to the decision that the SMSF real property investment option was not the optimal arrangement for the couple concerned.