Financial adviser fees

Candystore

Candystore

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I am switching a pension preservation fund to a new advisor.

Do these fees seem reasonable?

Initial financial adviser fee : 2.50%
Annual financial adviser fee : 0.50%
 
Yes, the max is:
3.45% including vat for initial
1.15% including vat for ongoing

But you can negotiate. I would at least ask them the waive that 2.5% for initial.
 
There’s going to be other fees on top of the advisor fees as well, right? That’ll make it look too expensive.
 
Pegasus said:
Yes, the max is:
3.45% including vat for initial
1.15% including vat for ongoing

But you can negotiate. I would at least ask them the waive that 2.5% for initial.
Click to expand...
I hate bargaining with these folks. I do not even know how to motivate such a request.
 
Candystore said:
I am switching a pension preservation fund to a new advisor.

Do these fees seem reasonable?

Initial financial adviser fee : 2.50%
Annual financial adviser fee : 0.50%
Click to expand...
I should have mentioned, these exclude VAT.
 
Candystore said:
Such as?
Click to expand...
I’m asking you.

Depending on the product, there could be a management fee (i.e. one fee for advisor and another for company that provides product), and then a fee for the investment itself (whatever unit trust or ETF you put the money in).

So you have to add together three or four things to get the full fee at some companies. More than 2% total would be a definite no for me. 1.5% on expensive side, less than that is good.
 
Candystore said:
I am switching a pension preservation fund to a new advisor.

Do these fees seem reasonable?

Initial financial adviser fee : 2.50%
Annual financial adviser fee : 0.50%
Click to expand...

Here are my current fees (the OP contains my new fees):

1715955250705.png
 
I don't know, but many years ago, I moved it to Allan Gray myself. I don't actually know what the fees are , but I think if self invested , then there were none at the time. Has also appreciated well.

Anyway, could or could not be applicable today
 
Candystore said:
Here are my current fees (the OP contains my new fees):

View attachment 1710851
Click to expand...
Ok.
When you have that many funds you are basically buying the market.
Meaning you will most likely get average performance.
In other words, there is almost no chance of you outperforming the market with that many funds.
But you are paying high fees for this.
Over 1.5% it seems.

So in your case, you’d be better buying an index fund that attempts to track the market which should have average returns, but low fees.
As in below 0.5%

Otherwise just choose one or two managed funds if you think they will outperform, or at least equal the market.
For my RA. I go with Allan Gray balanced, plus some Satrix MSCI world. I don’t go via a broker.


The fees I refer to above are just for the fund management.
 
Pegasus said:
Ok.
When you have that many funds you are basically buying the market.
Meaning you will most likely get average performance.
In other words, there is almost no chance of you outperforming the market with that many funds.
But you are paying high fees for this.
Over 1.5% it seems.

So in your case, you’d be better buying an index fund that attempts to track the market which should have average returns, but low fees.
As in below 0.5%

Otherwise just choose one or two managed funds if you think they will outperform, or at least equal the market.
For my RA. I go with Allan Gray balanced, plus some Satrix MSCI world. I don’t go via a broker.


The fees I refer to above are just for the fund management.
Click to expand...

Sorry if we misunderstood each other: the screenshot with the long list of funds is my CURRENT situation.

My NEW advisor is only investing in 3 funds.

My issue is in comparing the fees, and asking if my new fees are too high?
 
Why do you want to move it to another adviser thing that just eats your money?

Move it to 10x and call it a day.

Effective Annual Cost : 1.2% and gets less as it matures.

14.6% return after costs for 2023.
 
Candystore said:
Sorry if we misunderstood each other: the screenshot with the long list of funds is my CURRENT situation.

My NEW advisor is only investing in 3 funds.

My issue is in comparing the fees, and asking if my new fees are too high?
Click to expand...
The ongoing fee is fine as far as advisors go. 0.575% is half of what they are allowed to charge.

That initial fee is crazy and cheeky. I would not pay that 2.87%.
If you are moving a million Rand, then that is R28 700.gone for nothing.
 
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