Retirement, Not Accumulation: How Australians Are Using SMSFs Differently in 2026
Self-managed super funds (SMSFs) are increasingly being used to pay retirement income, rather than simply build wealth, with new analysis of Australian Tax Office data showing more money now flowing out of SMSFs than coming in.
The findings come from a new report by financial planner James Hayes, a specialist in superannuation and retirement planning, which show that SMSFs have firmly shifted into retirement mode.
The report found:
- SMSFs are now paying out far more than they take in: In 2023–24, SMSFs paid $57.7 billion in retirement benefits, compared with $26.2 billion in total member and employer contributions, meaning benefit payments were around 2.2 times higher than contributions.
- SMSFs are operating as income vehicles, not wealth builders: In the 2023-24 financial year, SMSFs were a net payer, with total outflows of $80.4 billion exceeding inflows of $46.5 billion.
- More than half of SMSF members are already at retirement age: 50.8% of SMSF members are aged 60 or over, 38.2% are 65+, and 16.7% are 75+, reinforcing SMSFs' role as a retirement-stage structure.
- Liquidity and access to cash remain a priority: Nearly half of all SMSF assets are held in listed shares (28.1%) and cash or term deposits (16.2%), reflecting the need for flexibility as members draw regular income.
- Typical SMSF balances are lower than headline averages suggest: While the average SMSF balance is around $1.63 million, the median is closer to $930,000, reflecting how a relatively small number of very large funds pull the average higher.
Hayes says the cashflow data points to a clear shift in how SMSFs are being used: "When SMSFs are paying out more than twice what they receive in contributions, it's a clear sign they've entered the income phase. These funds are no longer about accumulation – they're funding day-to-day life in retirement."
This shift changes how SMSFs need to operate once members leave full-time work: "Running an SMSF in retirement is very different to running one in your working years. Liquidity, simplicity and cash flow become just as important as investment returns," he says.
The report numbers also challenge the long-held idea that SMSFs are mainly for high-earning professionals in their peak working years. "A lot of people still think SMSFs are mostly for people in their 40s building wealth," says Hayes. "In reality, most SMSF members are already at, or well into, retirement."
These findings form part of a broader report analysing how Australians are actually using self-managed super funds in 2026, based on the most complete Australian Tax Office data available.
Read the full report on the Southern Advisory website.
