#019 - Your Spare Bedroom Is Being TAXED?! Millionaire Reacts 😱💸

In this episode of SMSF Insider, host Troy, founder of Blue Chip SMSF Services, addresses a listener's question about purchasing cryptocurrency through a self-managed super fund (SMSF). He explains that it is permissible to buy crypto with an SMSF as long as the account is set up in the SMSF's name. The discussion also touches on broader economic issues, including the unexpected increase in immigration and its impact on the cost of living and housing affordability in Australia. Troy emphasizes the importance of focusing on positive gearing as a property investor, highlighting that while tax benefits are advantageous, the primary goal should be generating income from property investments. Tune in as Troy navigates these complex topics to empower listeners in their journey towards financial independence.

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Please note: The information provided in this recording is for coaching and educational purposes only. It should not be considered personal financial advice. Everyone’s situation is different, so before acting on any of the content discussed, please seek independent financial advice tailored to your specific circumstances.

Timestamps:

00:00:00 - 00:00:00: Introduction

00:01:05 - Welcome to SMSF Insider

00:01:29 - Retirement Age Trends

00:02:32 - Maximizing Contributions

00:03:22 - Immigration Policy and Housing Crisis

00:04:26 - Spare Bedroom Tax

00:05:16 - Buying Crypto with SMSF (Revisited)

00:06:05 - Buying Property in a Trust

00:07:17 - Negative vs. Positive Gearing

00:08:00 - Commercial vs. Residential Property

Episode Transcript

(00:03):
If you want to buy crypto out of your self-managed super fund, that's certainly something you can
You just need to make sure when you are establishing the SMSF
and you are setting up the account with the exchange that
I don't recall Australians ever being told at the last election that
we were going to suddenly double immigration, actually triple immigration.

(00:25):
Cost of living is already expensive and housing is becoming
more and more difficult for home ownership and not just even home ownership,
People rely upon negative gearing to reduce their tax, which is
also good if you're just getting a property for the first time. However, as you become a
more serious property investor, you find that you need to shift your
You don't just buy property for the tax benefits, you're buying it primarily

(00:49):
for it to be making you money as opposed to just for
the taxation benefits. Taxation benefits should be secondary to the primary
benefit, which is the property actually making you money. Welcome to
SMSF Insider, where we help busy professionals to
gain financial independence using an SMSF. Hi, I'm Troy,
founder of Blue Chip SMSF Services. Now, over the last 20 years, I've

(01:09):
helped thousands of Aussies manage the complexities of self-managed super
funds. And in this podcast, I'll answer your questions, break down the
myths, so you can take charge of your financial freedom. Let's get into it.
G'day guys, so welcome to this edition of SMSF Insider, where
we'll be looking at some videos that have gone viral and
It's been revealed more Australians are working well into their 70s and

(01:33):
80s as retirement ages continue to rise. New data
from KPMG shows the average expected age of retirement for
Yeah, definitely we do see a lot of this where retirees
are certainly working later into their 60s and
even into their 70s as they potentially don't

(01:53):
have enough either cost of living has gone
up so much or potentially they don't have enough in retirement
savings to actually retire. So that's
why it is, I guess, important to start investing sooner
rather than later so you don't get caught out at retirement age. A lot
of these guys just can't afford to retire. So

(02:14):
they are still working into, you know, well into their 60s
and 70s. So, yep, something
while for women it is now around 65. Experts say
the rise is driven by cost of living pressures and older Australians
So you don't become a statistic of working longer

(02:36):
than you want to, then probably
the best thing to do is obviously max out
your concessional contributions and even your non-concessional contributions,
topping up your fund. sort of as
soon as you can. The sooner you start maxing out those contributions, the
better off you're going to be at the tail end at retirement

(02:58):
age. So speak to your advisor about maxing out
I don't recall Australians ever being told at the last election that
we were going to suddenly double immigration, actually triple immigration.
from current levels of pre-election of

(03:22):
And that is certainly a bit of a hot topic around immigration
policy. And we already have a bit of a housing crisis.
So I can understand the frustration that people are
having with regards to immigration policy. It is,
you know, potentially cost of living is
already expensive and housing is

(03:43):
becoming more and more difficult for home ownership and not just even
home ownership but even on the rental end. So I
do understand the frustration here and I'll just keep
playing this video and see what else he's got to say. Yeah,
I don't know the reason the Albanese government, I

(04:07):
don't know their actual immigration policy, but certainly it
is a bit of a hot topic, more so on the cost of living and
Spare bedroom tax. What an absolute farce. These
morons in the federal government now want to consider bringing
Yeah, this is probably one of the most ridiculous taxes

(04:30):
I've ever heard. We've obviously got the unrealized
capital gains tax coming in for super funds over
$3 million. And we all know that's only going
to affect a small portion of the population at the moment. But as
time goes on, that will certainly capture more
and more of the Australian population as balances

(04:52):
grow. But certainly a spare bedroom tax is
probably the most ridiculous one I've ever heard. Just quickly guys, if
you're a busy professional fed up with traditional super funds and overwhelmed by
the setup of your SMSF, we can help. Book in a call with my team
using the link in the show notes and let's build your future on

(05:16):
If you want to buy crypto out of your self-managed super fund, that's certainly something you
can do. It seems like a good strategy because in a self-managed super fund, crypto
is just a nice little asset class to think about. I tend to think it's a bit more of a
Certainly you can buy crypto using your SMSF. You just
need to make sure when you are establishing the SMSF
and you are setting up the account with the exchange

(05:37):
that the name of the account with the exchange
that you're setting up with is in the name of your SMSF. So you want
to make sure it's established in the name of the SMSF and
as opposed to in your own personal name. Otherwise, it'll
be very difficult to prove that the super fund owns those assets. So
make sure if you are purchasing crypto, just make sure you're getting some

(05:59):
guidance with setting up the account
Buying a property in a trust. We're getting heaps of inquiry about this
at the moment. The first thing you need to do before going down this route is
speak to an accountant. Now, if you are buying a property in a trust, here's just
a few of the questions you need to be asking. What's the cost of setting it
up? Managing it? How does the negative gearing work? Capital gains tax? Land

(06:22):
tax? And also importantly, how does the lending work? When you initially buy
a property in the trust, the loan application isn't really much different to a standard
Yes, so you can obviously purchase property in a number of different entities,
obviously your trust being one of many, and
you do need to seek some guidance before

(06:43):
making any decisions around what entity you're going to be purchasing in. You
can obviously do the same thing and purchase property through an
SMSF. I guess the benefits of
doing that with an SPSS over a trust is that long term
you're not going to pay any capital gains tax in
retirement or the maximum that you will pay is

(07:04):
after 12 months is 10%. So just be mindful of
what entity you're doing that you're purchasing property in and then
your advisor can tell you the benefits, the pros and cons around
People rely upon negative gearing to reduce their tax, which is
also good if you're just getting a property for the first time. However, as you become a
more serious property investor, you find that you need to shift your

(07:26):
focus to more positive gearing as the old property pays
for the new property. Good starting point, but make sure you understand that it is
only just that. The way that you can increase your property wealth is
Chris is making a good point here in terms of you
don't just buy a property for the tax benefits. You're buying it,
you should be buying it primarily for it to be making

(07:50):
you money as opposed to purchasing it just for
the taxation benefits. Taxation benefits should be secondary to the primary
If people ask me why I buy commercial over residential, it's just because
I like sleeping at night. With residential, you get really small returns and
you get a whole lot of headaches. When a light bulb goes out, you get a call. When the

(08:12):
Yes, so when you're purchasing assets either inside
or outside of Super, property in particular, you
can obviously purchase either residential, commercial or
industrial. With commercial, obviously, it
is a little bit more that the tenants typically pay for all

(08:33):
the outgoings, whereas with residential, the
landlord is typically paying for all the outgoings. So
they are two different beasts. So make sure you're
getting some guidance around which type of property will
be best suited for your particular portfolio. Hi guys, thanks for
tuning in to this episode of SMSF Insider. If you've

(08:55):
got some comments, please drop them in the comment section below. I know you
will. And if there's a specific topic you'd like us
to talk about, then please feel free to share that with us
in the comment section below as well. Thanks for tuning in and look forward to
catching you on the next episode of SMSF Insider. Thanks
for tuning in to this episode of SMSF Insider. If you got

(09:15):
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