1. Choose a trustee structure

Corporate trustee

We recommend setting up a corporate trustee for these reasons:

  • Assets are in corporate name making it simpler to add or remove a member as members’ circumstances change
  • Easier to identify and separate fund assets from those personally owned by the directors of the corporate trustee
  • Directors’ personally owned assets are generally protected if the trustee is sued for damages
  • Administrative penalties for rule breaches apply to the corporate trustee, compared to every trustee under an individual trustee structure

Read more about corporate trustees.

If you choose an individual trustee structure be aware that:

  • It can be costly and time consuming to add or remove a member from the fund as members’ circumstances change because assets are in the name of all the trustees.  This can be an important consideration for estate planning
  • It’s hard to identify and separate fund assets from those personally owned by the trustees
  • Personally owned assets may not be protected if the trustee is sued for damages
  • Administrative penalties for rule breaches apply to every trustee and could be higher than with a corporate trustee

Here’s what the ATO say.

2. Set up an SMSF

General checklist

Once you have decided on a trustee structure you need to:

  1. Appoint your trustees.  Make sure all individuals (fund members) are eligible to be trustees or directors of the company trustee and understand their responsibilities and obligations
  2. Create the trust and trust deed - make sure it complies with Australian super fund laws and is appropriate to your circumstances and objectives
  3. Register your fund and get an ABN
  4. Set up a bank account for your fund to accept rollovers and contributions, manage investment cash flow and pay expenses
  5. Get an electronic service address and give it to your employer for super contributions
  6. Prepare your investment strategy and consider insurance for every member of the fund
  7. Prepare an exit strategy should you decide to wind up the fund

Check the ATO website for more info

As trustees or directors you’ll remain responsible for ongoing management of your fund including any compliance obligations.

Need help?

Setting up an SMSF and creating an investment strategy can seem complex. Our experienced SMSF accredited advisers can help you through the process.

3. Build an investment portfolio

A critical step for you and the trustees is to develop your investment strategy before you start investing. 

Investment strategies

Consider your strategy - base it on fund objectives and members’ circumstances including risk profiles and life stages. Your strategy may change during the accumulation and retirement phase.

It's important to review your investment strategy regularly including taking into consideration any change in member circumstances.

Explore more

Diversify your portfolio

There are a range of risks with holding a narrow portfolio. Diversification can help reduce portfolio exposure to market downturns.

Read how

Things you should know

This information is prepared by Commonwealth Bank of Australia ABN 48 123 123 124 AFSL 234945 (Commonwealth Bank). Registered office: Ground Floor, Tower 1, 201 Sussex Street, Sydney, NSW 2000. For terms and conditions of the products mentioned, please visit any of our branches, or call us on 1800 138 363, Monday to Friday, 8.30am to 5.30pm AEST.

This information isn’t advice and has been prepared without taking account of your personal needs, financial and taxation situation or objectives. Before acting on the information you should consider whether the information is appropriate for you. 

Commonwealth Direct Investment Account (CDIA) is a product of the Commonwealth Bank.  See the Commonwealth Bank Financial Services Guide (FSG) and the Transactions Savings and Investment Account – Terms and Conditions available from Commbank.com.au for fees and charges. CDIA is marketed and administered by CommSec.