SMSF pool still ripe for financial advice: AMP

Self-managed super fund trustees seeking financial advice jumped 6% last year, and they are hungry for further advice, according to AMP Capital research.

Sixty-three per cent of SMSF trustees told AMP Capital they would entertain further financial advice, with retirement strategy (30%), income generation (28%) and investment selection (22%) topping the areas where trustees most sought advice.

Fear of regulatory changes is among the factors driving the heightened interest in financial advice.

Seventy per cent of SMSF investors said they were concerned by ongoing regulatory reform to superannuation, while 47% said they planned to seek financial advice on how to best navigate the changes, AMP Capital said.

"In a period of heightened regulatory change, it's clear that many SMSF trustees are looking for help to set up the right portfolio to reduce risk while still supporting their retirement goals. It's an opportunity for advisers to share their expertise with new and existing SMSF clients," AMP Capital global head of marketing, digital, innovation and direct Tim Keegan said.

The findings come from AMP Capital's latest survey of investment trends in the SMSF industry. AMP Capital undertook a quantitative survey of 700 AMP Capital SMSF investors alongside Investment Trends to derive the findings.

The research revealed managed funds advice as another area of opportunity for financial advisers to tap into the SMSF trustee base.

"The research showed 22% of trustees intend to invest in managed funds over the next 12 months, with one of the main reasons to increase portfolio diversification. There's an opportunity for advisers to discuss appropriate unlisted managed funds and active exchange traded funds available in the market to support trustees achieve this objective," Keegan said.

Finally, the data revealed SMSF trustee's thoughts about diversification.

Only 35% believed a portfolio had to have more than four assets to be diversified. More than half (53%) said a mix of Aussie and global equities is diversified.

About half (47%) said 20 individual equity stocks were enough to diversify a portfolio.

"The research reveals a potential concentration risk in equities for SMSF trustees. It's important to not only consider diversification in the equities held but also across different asset classes, including infrastructure and property for example," Keegan said.

The survey also found SMSF trustees were increasing cash reserves in response to global volatility.

On average an SMSF had $110,000 in cash. About two thirds (65%) of the SMSF investors said they were keeping cash in reserve following concerns about global volatility.

Read more: SMSFAMP CapitalFinancial adviceInvestment TrendsVolatilityAMP Capital SMSFTim Keegan
Link to something bcIr87zc