Are SMSFs right for you?

Saving for retirement is something that should be high on everyone's agenda, so when the time comes for you to think about your post-work years, chances are your attention will turn to exactly how you'll achieve this.

Self-managed super funds - or SMSFs as they are commonly known - are just one tool you might want to consider.

Like superannuation funds, they are an effective means of setting money aside for retirement, but the only difference being that fund members are often trustees. In short, this means the SMSF is set up for their benefit and regulated by the Australian Tax Office.

Bear in mind that running your own super fund might be more complex than you think. If you have skills in financial and legal matters then it could be the right choice for you, but make sure you give it plenty of thought first.

There are strict laws surrounding SMSFs that every trustee needs to be aware of. For example, there are restrictions on who you are able to accept contributions from and strict caps are in place.

Furthermore, trustees have various administrative obligations they are required to meet in order to keep the fund operational and on the right side of the law.

Legislation is due to come into force on July 1 2014 that will give the ATO greater powers to penalise trustees who contravene superannuation law, so it pays to seek advice before setting up your fund.

Carrying out the necessary research before establishing your SMSF is the best way to avoid any nasty surprises further down the line - and there is no substitute for expert guidance.

You will be expected to be actively involved in your SMSF from day one, so this is not a decision you can afford to take lightly.