• Self-managed super funds: a statistical overview 2014–15

    This is an annual statistical overview of the self-manager super fund (SMSF) sector for 2014–15. The data is collected from the SMSF annual return (SAR), SMSF registrations and auditor contravention reports.

    The publication includes data reported for previous years based on SMSF returns. We have since revised SMSF data from 2012 onwards. Because much of the data is either estimates or based on lodgments, the data is likely to change in future releases of this statistical overview.

    This publication is not available in PDF. You can print a section of the report or the entire document by using the print options located on the top, right-hand side of the page.

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    Contact

    For comments or enquiries about this report, email us at SPR_smsfstats@ato.gov.au

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    Introduction

    Purpose

    Following the publication by the Super System Review (of A Statistical Summary of Self-Managed Superannuation Funds (the Review) released on 12 December 2009, we released our own publication Self-managed superannuation funds: A statistical overview 2008–09 (the overview) in December 2011.

    We subsequently released the publications Self-managed superannuation funds: A statistical overview 2009–10 in April 2012; Self-managed superannuation funds: A statistical overview 2010–11 in December 2012; Self-managed superannuation funds: A statistical overview 2011–12 in December 2013; Self-managed superannuation funds: A statistical overview 2012–13 in December 2014, and Self-managed superannuation funds: A statistical overview 2013–14 in December 2015.

    This publication follows on from these overviews using 2014–15 data. We anticipate continuing to provide annual overviews of the SMSF sector.

    When appropriate, we refer to Australian Prudential Regulation Authority (APRA) data for comparisons to the SMSF sector.

    Background

    We began regulating SMSFs in the 2000 financial year under the regulatory framework of the Superannuation Industry (Supervision) Act 1993 (SIS Act).

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    From 2008, a new Self-managed superannuation fund annual return (SAR) was developed to enhance the regulation of SMSFs and enable the collection of more reliable data.

    Generally, the reported data for this overview has been collected from:

    • the SAR
    • SMSF registrations
    • auditor contravention reports (ACRs) lodged by SMSF auditors.

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    SMSF segment overview

    Size of SMSF sector

    SMSFs make up 99.6% of the number of funds and 29% of the $2.1 trillion total superannuation assets as at 30 June 2016.  

    • SMSFs make up 99.6% of the number of funds and 29% of the $2.1 trillion total superannuation assets as at 30 June 2016. Footnote1
    • There were 577,000 SMSFs holding $622 billion in assets, with more than one million SMSF members. Footnote2
    • Over the five years to 30 June 2016, growth in the number of SMSFs averaged almost 6% annually.
    • 45% of SMSFs have been established for more than 10 years, and 17% have been established for three years or less.

    Growth of SMSF assets

    In 2015, the average assets of SMSFs reached $1.1 million, a growth of 20% over five years. Average assets per member were $590,000, the highest over five years. 

    • In 2015, the average assets of SMSFs reached $1.1 million, a growth of 20% over five years.
    • Average assets per member were $590,000, the highest over five years.
    • For SMSFs established in 2015, the average fund assets were $392,000, an increase of 15% compared to average assets of funds established in 2011.
    • 48% of SMSFs had assets between $200,000 and $1 million, accounting for 23% of all SMSF assets.
    • The majority of SMSF assets were held by funds with assets between $1 million and $5 million, representing 54% of total SMSF assets.

    Contributions

     Contributions

    • Total contributions to SMSFs increased by 38% over the five years to 2015. This is 6% higher than the growth of total contributions to all superannuation funds (32%) over the same period.
    • Member contributions increased to more than $26 billion or by 54% over the five-year period.
    • Employer contributions made to SMSFs fell by 0.5% over the five years to 2015.

    SMSF benefit payments

    • Benefit payments have increased from $19.2 billion in 2011 to $35 billion in 2015. The proportion of SMSF members receiving a benefit payment also increased by 24% in 2015.
    • In 2015 the average benefit payment per fund was $126,000, and the median payment $62,900.
    • In 2015, 94% of all benefit payments were in the form of income stream (including transition to retirement income streams).
    • Transition to retirement income streams have remained steady representing 12% of total benefit payments in 2015.

    SMSF payment phase

    SMSF payment phase

    • The majority of SMSFs continued to be solely in the accumulation phase (52%) with the remaining 48% making pension payments to some of or all members.
    • Over the five years to 2015, there was a shift of funds moving into the pension phase (7%).
    • Of SMSFs that started to make pension payments in 2015, 50% were more than five years old, while 23% were less than two years old.
    • Of funds established over the last 10 years to 2015, 69% have not started making pension payments.

    SMSF member demographics

    SMSF member demographics 

    • At 30 June 2016 there were almost 1.1 million SMSF members, of whom 53% were male and 47% female
    • The trend continued for members of new SMSFs to be from younger age groups. With the median age of SMSF members of newly established funds in 2015 decreased to 48 years, compared to 59 years for all SMSF members as at 30 June 2016.
    • In 2015, SMSF members tended to be older than members of APRA funds and had both higher average balances and higher average taxable incomes.
    • The proportion of members receiving pension payments from an SMSF continued to trend upwards. In 2015, 41% of members were fully or partially in pension phase, compared to 34% in 2011

    SMSF member balances

    SMSF member balances 

    • At 30 June 2015 the average SMSF member balance was $590,000 and the median balance was $355,000, an increase of 21% and 26% respectively over the five years to 2015.
    • The average member balances for female and male members were $498,000 and $633,000 respectively. The female average member balance increased by 24% over the five-year period, while the male average member balance increased by 17% over the same period.
    • Over the five years to 2015, the proportion of members with balances of $200,000 or less decreased to 31% of all members.

    SMSF asset allocation

    SMSF asset allocation 

    • SMSFs directly invested 81% of their assets, mainly in cash and term deposits and Australian-listed shares (a total of 57%).
    • For the third consecutive year the proportion of total assets held in cash and term deposits decreased slightly (by 2%).
    • As fund asset size increased, the proportion of assets held in cash and term deposits decreased significantly while the proportion of assets held in trusts and other managed investments increased.
    • SMSFs in the pension phase had similar assets to SMSFs in the accumulation phase. The only noticeable differences are that SMSFs in pension phase tend to slightly favour listed shares and managed investments more, while those in accumulation phase favoured property assets more.

    Limited recourse borrowing arrangement (LRBA) assets

    • In 2015, 6% of SMSFs reported assets held under LRBAs, which is consistent with the prior year (5.7%). The majority of these funds held LRBA investments in residential real property and non-residential real property. In terms of value, real property assets held under LRBAs collectively made up 91% or $18.5 billion of all SMSF LRBA asset holdings in 2015.

    SMSF borrowing

    • At 30 June 2015, SMSFs held total borrowings of $16.9 billon representing 2.8% of total SMSF assets. The average amount borrowed increased from $346,000 in 2011 to $378,000 in 2015.

    Investment performance

    Investment performance 

    • In 2014–15, estimated average return on assets for SMSFs was positive (6.2%), a decrease from the estimated returns in 2014 (of 9.7%), but remains in positive terms and is consistent with the trend of investment performance for APRA funds of more than four members over the five years to 2015.

    SMSF expenses

    • The estimated average total expense ratio of SMSFs in 2015 was 1.1% and the average total expenses value was $12,200.
    • The average ‘investment expense’ and ‘administration and operating expense’ ratios were consistent at 0.60% and 0.50% respectively.
    • SMSFs in pension phase incurred higher average total expenses than funds solely in accumulation phase.
    • The average expense ratios for SMSFs declined in direct proportion to the increased size of the fund.

    SMSF auditors

    • In 2015, there continued to be a trend towards SMSF Auditors performing audits for a larger number of SMSFs, with most (53%) performing between five and 50 SMSF audits, and 28% of auditors performing between 51 and 250 SMSF audits.
    • There were 5% of SMSF auditors conducting more than 250 audits, representing 44% of total SMSF audits in 2015.

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    Footnote 1

     

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    Footnote 2

     

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      Last modified: 20 Dec 2016QC 50779