A 'self managed super fund', also known as a DIY Super, is a way for employees and their employers to jointly contribute towards the employee’s pension. The money is invested in government bonds, shares or even property until the employee retires. Upon retirement, the employee can release the fund in one of three ways; either as regular payments, as a lump sum, or as a combination of the two.

By having a DIY Super, you will gain:

Control: By having a DIY Super, you have the flexibility to choose how and where your funds are invested and also the ability to adjust your investment strategy based on ever changing economic factors.

Investment Choice: A DIY Super gives you the added ability to choose from a huge range of investment opportunities for your money that not many other funds can do. You can choose exactly what to invest in and how much you want to put in into each investment, this separates it from the large number of other funds available.

Low Taxation: Tax payments can cost a large amount of money over the full course of the fund, though as a DIY Super is eligible for certain tax concessions, this amount is reduced and you will ultimately have more money by the end of the funds life.

Protection: The assets of a DIY super are protected from bankruptcy and other legal claims (up to a certain threshold). It is nice to have this security in place as losing your retirement fund in your later years is a major problem.

If you think that a DIY Super might be a wise way to save for your retirement, then you should keep the following in mind...

- Each representative of every fund must be a trustee.

- A Trustee cannot receive compensation for carrying out any duties.

- Compliance with regulations is your responsibility.

- The fund needs to be separated from your own assets.

- All records, statements and paperwork must be held on to for the duration of the fund.

Though a DIY Super is ultimately the responsibility of those who are members of it (i.e. those who are investing), help can be sought from independent financial advisors. There are many professionals offering DIY super services, so you will not have any problems finding one, but some are much better at what they do than others.

When deciding which DIY Super advisor to use, look at whether they are licensed to give you financial advice and whether their advice is appropriate for your specific circumstances. You should be willing to pay extra for someone who is more experienced because you will make more money in the long run.

Remember, starting a DIY Super is not a decision that you want to take lightly, and that applies to each stage of the process. So, carefully consider who you want to open the fund with and what exactly you want to invest in, as well as who you will hire to advise you on the rules and regulations that you must adhere to.