Cooper Partners head of SMSF and succession Jemma Sanderson said that while extending the member limit certainly has its merits where families have got more than two children and they want to include their children in their fund to help kick-start their superannuation, running segregated investment portfolios for six different members could result in a lot of additional work for SMSF firms.
“If you’re running separate segregated investment portfolios for six people in a fund, then that can become administratively quite cumbersome to manage, and so the cost of running that versus having two separate funds is six of one and half a dozen of the other,” said Ms Sanderson.
Ms Sanderson also stressed that the trustee structure of the fund is critical when looking at the number of members in a SMSF, with the administration of the fund much simpler with a corporate trustee structure.
“Having six individual trustees is a nightmare. Super funds shouldn’t have individual trustees in my view. They need to have a corporate trustee and that just makes things so much easier from an ongoing administration perspective,” Ms Sanderson said.
“If you had six individual trustees in there, which I hope no one would recommend, one of them passes away or someone wants to leave the fund, you’0ve got to update all the asset registrations.”