Before you start making investments, you must prepare an investment strategy.

An investment strategy sets out how you plan to achieve the fund’s investment objectives. It provides you and the other trustees with a framework for making investment decisions to increase member benefits for their retirement.

ProAdvisory is a licensed financial adviser and can help you prepare an investment strategy.

There is no prescribed format for the investment strategy, but it must reflect the purpose and circumstances of the fund and its members and must be reviewed regularly to make sure it is still appropriate.

When preparing your investment strategy, consider the following:

• diversification (investing in a range of assets and asset classes)
• the risk and likely return from investments to maximise member returns
• the liquidity of fund’s assets (how easily they can be converted to cash to meet fund expenses)
• the fund’s ability to pay benefits when members retire and other costs the fund incurs
• whether the fund should hold insurance cover for members
• your members’ needs and circumstances.

Your investment strategy should be in writing so you can show your investment decisions comply with the strategy and the super laws.

More information: Contact the SMSF expert ProAdvisory.