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Trustee spotlight: Bruce Foreman’s experience running an SMSF for over 22 years

Foreman says he is a conservative investor and tends to hold about three to four years of pension income in cash, with the remainder of the fund’s assets in shares and property.



Bruce Foreman set up his SMSF in 1995 because he wanted to have more control over his retirement savings.

“I did my research and found out as long as you have more than $250,000 in the fund it can make sense to open your own self-managed superannuation fund,” he says.

A commercial property expert, Bruce was able to start investing in property through his fund. “Initially I did a residential development in a good area that generated reasonable value,” says Foreman.

“From there I went into developing commercial properties, putting as much money into the fund as I could. I invested in commercial property through property syndicates which he led and controlled,” he adds. 

Initially, the investments were generally between $5 million and $10 million, with appropriate levels of debt to allow the syndicate investors to generate a sensible return.

“Over time I became more involved in equities because they offer higher liquidity compared to property. As I get older, I need to know I can easily get access to my money, and shares allow me to achieve this. Whereas it might take up to three months to get your money back investing in property in a good market, or up to a year if it’s a hard market,” Foreman explains.

More recently, he has started investing in property trusts and infrastructure. “These investments return a reasonable yield and are generally not impacted to the same degree as many other asset classes,” he explains.

When finding investments, Foreman says it’s important for SMSF trustees to do their own due diligence and ensure they really understand what they are investing in.

He also manages his own share portfolio. “I transact shares through an online account. For a period I ran two accounts, one with a broker and my own one. I have produced a better performance through my own broking account and have subsequently closed my other one. I also accept that if the value of my shares goes down it's my fault, not someone else's.”

Foreman says he is comfortable with the way he has managed his fund so far. “It has taken a fair bit of work. You get out of it what you put into it. If you rely a lot on external support, you pay extra costs and don't necessarily get the results from your fund that you’re after.”

For instance, when it comes to property investments, he always does substantial research before either investing in small property syndicates or through larger, more commercial ones. 

“I read about every property they have. I know who their tenants are and I understand the properties.”

Foreman has recently invested in the AMP Capital Core Infrastructure Fund and again applied his due diligence process to this investment. 

“After doing my research, I feel comfortable investing in the fund, taking into account its risks and knowing my own liquidity profile requirements,” he says.

At the moment Foreman says he has more cash in the fund than he previously did. “I used to invest more in higher risk development opportunities. Now I invest more passively and I understand I probably won’t realise the same return than in the past. 

“Until I was 50, I was happy to be more exposed to higher risk investment strategies, especially because of my background in commercial property, I felt I could understand those risks.” 

On turning 50 Foreman started to wind back higher risk investing in favour of more stability and liquidity. 

“When I turned 55, I started to invest more in shares, with about half the portfolio in equities. Now I'm 65, equities make up about 80% of the fund. And now I am thinking about how I might be able to wind things back and get back into cash as needed.” 

Foreman says he is a conservative investor and tends to hold about three to four years of pension income in cash, with the remainder of the fund’s assets in shares and property.

“About 20% of the fund is highly liquid,” he says.

Forman’s advice to other SMSF trustees is to actively manage the investments in the fund for the best return, and tweak the strategy as the fund members’ requirements and risk profile shifts.

Would you like to be featured in SMSF News as part of our SMSF Trustee Spotlight Series? 

As part of our ongoing SMSF Trustee Spotlight Series, we regularly interview and feature SMSF Trustees that are active on the SMSF Community.  

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Funds related to this article: Core Infrastructure Fund

Access to a high quality diversified portfolio of unlisted and listed infrastructure assets across energy and utilities, transport and social sectors, both within Australia and across global markets.

The Fund aims for diversification by investing across infrastructure assets, sectors and geographic locations, with asset allocation targeting 50% to unlisted assets and 50% to listed securities.

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