RA options for doing a section 14

I worked out the EAC of every possible service provider where to I wanted to move to !

EAC = all costs = (investment management fees, advice if any, admin fees, other fees (debit order costs))
 
zerocool2009 said:
I would love to hear someone who is doing a section 14 and they took 30% and the RA is old.

I am listening alot to the money show on 702 (and service providers is always saying, what is standing in the contract).

A few weeks back someone called in. He took out an RA from OM and he moved it, and they took a lot of the RA as a penalty. OM was also on the line and they asked what is on black on white.... And sad to say, if the client dont read when he takes something out, who is to blame.

So .... anyone doing a section 14 soon where you are losing thousands and thousands and nothing stated in the contract (please comment if you want)
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I did the Section 14 transfer of a Preservation Fund with Alexander Forbes last year to Old Mutual and it didn't cost anything.

But I guess that doesn't apply to your case because it's not the old RA format.

Now however I'm struggling to just get ANY kind of cost data information from them applicable to my own money that isn't just a Fact Sheet of randomness bull****.

****

Contract wise from Old Mutual there is this...

This maximum regulated reduction fee reduces to 0% on a straight line basis during the period
calculated from the date of payment of the first premium to the following times:
If your premium term is The maximum regulated reduction fee becomes 0% at
20 years or longer The end of year 10
10 years or longer but shorter than 20 years Half of the premium term
5 years or longer but shorter than 10 years The end of year 5
Shorter than 5 years The end of the premium term

Which is what I would imagine is what can nail you if you do want to move away at a particular point in the contract term.
 
zerocool2009 said:
I worked out the EAC of every possible service provider where to I wanted to move to !

EAC = all costs = (investment management fees, advice if any, admin fees, other fees (debit order costs))
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Well then why don't you put it out there for the rest of us to see?

My bigger issue isn't so much that the costs exist, I knew that from the start. It's just their ridiculous book keeping and the way it's not broken down properly.

I've now asked for a full detail statement and not just the crap you get on the self-service portals.
 
SauRoNZA said:
These ****ers really need to get more transparent with fees.

My Old Mutual plan has a TER 1.77% which doesn't seem all that crazy.

But when you look at month to month transaction statement there is a "Plan Charge - Asset" which amounts to 13-14% of the amount invested.

I mean what the **** is this? And surely that is part of the TER?


And how does this compare on the passive funds like 10x? Do these fees magically disappear?

Trying to get transparency out of these ****ers is like getting water out of a stone.


My favourite is my Preservation Fund from a previous job where you can't get any data whatsoever from it. It's like there are magically no costs whatsoever.
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The TER is internal to the fund and are the cost paid buy the fund and thus affects all investors in that fund (and class of the fund) the same. Your individual charges like the Plan Charge and the advisor fee and whatever else can't be in the TER.

My advisorless Coronation Top 20 funds TER will be the same as Johns Coronation Top 20 funds TER who pays a financial advisor 0.5%, it's external to the fund and thus of no concern to me.

Can't really comment on the rest besides giving this advice from what I have read: One insures your life with life insurers, and one invests with asset managers, and never the twain shall meet.
 
SauRoNZA said:
Well then why don't you put it out there for the rest of us to see?

My bigger issue isn't so much that the costs exist, I knew that from the start. It's just their ridiculous book keeping and the way it's not broken down properly.

I've now asked for a full detail statement and not just the crap you get on the self-service portals.
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I pulled stats (fact sheets and compared EAC for all the portfolio's I wanted to select), did research for a month before moving my RA to AG :)

Everything should be available online to see how much it cost you month to month.

That is where i opened up my can of worms !!!!
 
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supersunbird said:
The TER is internal to the fund and are the cost paid buy the fund and thus affects all investors in that fund (and class of the fund) the same. Your individual charges like the Plan Charge and the advisor fee and whatever else can't be in the TER.

My advisorless Coronation Top 20 funds TER will be the same as Johns Coronation Top 20 funds TER who pays a financial advisor 0.5%, it's external to the fund and thus of no concern to me.

Can't really comment on the rest besides giving this advice from what I have read: One insures your life with life insurers, and one invests with asset managers, and never the twain shall meet.
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Yeah I understand that I'm just trying to get it broken down as they seem to summarize it into a single line item.

Even taking the Asset Plan costs of 2.73% + Admin Fee of R11,70 (such bull**** in an electronic world) + TER I still get to only about half the cost of the line item.

Line item amounts to anything from 13-20% of monthly investment depending on fund.
 
SauRoNZA said:
Yeah I understand that I'm just trying to get it broken down as they seem to summarize it into a single line item.

Even taking the Asset Plan costs of 2.73% + Admin Fee of R11,70 (such bull**** in an electronic world) + TER I still get to only about half the cost of the line item.

Line item amounts to anything from 13-20% of monthly investment depending on fund.
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My only cost in my monthly Coronation RA contribution? R3.50 for the RA debit order, which Capitec gets. Coronation gets their money via the TERs of the underlying funds.

Most other asset managers work like that too if you invest it their funds.

Asset managers who are LISPs (which means they offer other funds too) charge a platform fee for access to the external funds, investing in their own funds is free of that fee.
 
supersunbird said:
My only cost in my monthly Coronation RA contribution? R3.50 for the RA debit order, which Capitec gets. Coronation gets their money via the TERs of the underlying funds.

Most other asset managers work like that too if you invest it their funds.

Asset managers who are LISPs (which means they offer other funds too) charge a platform fee for access to the external funds, investing in their own funds is free of that fee.
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So why are you considering 10x then?

Just for the passive and even lower cost factor?
 
SauRoNZA said:
So why are you considering 10x then?

Just for the passive and even lower cost factor?
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You are the one considering them, do you mean "why do I recommend them"?

Anyway, my employer fund is 10X (thus passive), and thus I am following my personal method of investing into a managed RA. If my employer fund was a managed fund I'd be doing a 10X RA probably...
 
supersunbird said:
You are the one considering them, do you mean "why do I recommend them"?

Anyway, my employer fund is 10X (thus passive), and thus I am following my personal method of investing into a managed RA. If my employer fund was a managed fund I'd be doing a 10X RA probably...
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Sorry I must have confused the issue somewhere along the line.

For some reason I thought you had said you were trying to move stuff to them, but now I see from that other thread that your company is already using them (which is a good sign in and of itself anyway), before you said it above.

So I think I'm going to move my Preservation Fund over there as a test drive and review all this *** again in a year.

I don't even look at my employer one (Sanlam) as it's beyond my control either way so I've just kept the contribution low.

The active contributions one can stay with OM for the time being and given a year I'll have some data to compare between three different options.

Then I can move the RA out and ask about penalties etc.
 
supersunbird said:
~5% property just aint enough for a high growth portfolio for the younger person in my opinion, the rest (~20%) is then in bonds obviously. With my method 95% can be in high growth (SA equity, foreign equity, SA property) and just 5% in low growth (bonds, which actually can pay out lovely interest).

Easy enough to find people deriding RAs because the younger people can't invest 100% in equity so it sucks and is lower growth. My methods makes it high growth and there is the tax benefit on top of that.
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You are absolutely right, both the AG and Sygnia balanced funds have miniscule exposure to local property. Thanks for the heads up.

So how exactly are you going to achieve your 25% property in Reg 28 funds? I really don't see any (after looking for about five minutes admittedly). I checked Sygnia, there is nothing like that.
 
Eti1 said:
You are absolutely right, both the AG and Sygnia balanced funds have miniscule exposure to local property. Thanks for the heads up.

So how exactly are you going to achieve your 25% property in Reg 28 funds? I really don't see any (after looking for about five minutes admittedly). I checked Sygnia, there is nothing like that.
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Well, Coronation have at about 13% property in their Balanced Plus fund (historically they were also on 5%):
http://www.coronation.com/Assets/za...2017-May-Balanced-Plus-Fund-Comprehensive.pdf

No, I compile a Regulation 28 compliant RA of my own using various funds:
Reg28compliance.JPG

Recently switched part of my contributions from Global Managed to Global Equity Select (newish fund, or else I'd have chosen it earlier), and will phase portions from one to the other, so over time the equity allocations (local and foreign) will raise as well.
 
supersunbird said:
Well, Coronation have at about 13% property in their Balanced Plus fund (historically they were also on 5%):
http://www.coronation.com/Assets/za...2017-May-Balanced-Plus-Fund-Comprehensive.pdf

No, I compile a Regulation 28 compliant RA of my own using various funds:
View attachment 447490

Recently switched part of my contributions from Global Managed to Global Equity Select (newish fund, or else I'd have chosen it earlier), and will phase portions from one to the other, so over time the equity allocations (local and foreign) will raise as well.
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Thanks for this. Will play around with it also. My Sygnia is managed by the RoboAdvisor so will forfeit that.
 
AG also gives you the opportunity to take out a RA, breaking reg rule 28 !!! Take note of that
 
zerocool2009 said:
AG also gives you the opportunity to take out a RA, breaking reg rule 28 !!! Take note of that
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You will have to rephrase that to make more sense.

They do NOT allow you to take out an RA that is not Reg 28 compliant, but price changes in fund values can take you out of Reg 28 easily enough. At one time my static RA with AG had a 35% overseas allocation. They will only ask you after a year of permanent Reg 28 noncompliance to rebalance
 
Well I'm massively impressed with the entire process from 10x.

Clean and simple online application with signing of forms and all that.

Actually quite excited to see how things go forward.

Will check performance and costs etc and review in 1-3 years to compare Active vs Passive and High Cost vs Low Cost and then decide what to do with the other Old Mutual stuff if anything at all.

Not a fan of putting everything in one basket, but at the end of the day the underlying funds are all near the same anyway due to regulations etc so it's not a massive difference. Otherwise could just take my OM stuff literally "as is" and direct invest it with whoever.
 
SauRoNZA said:
Not a fan of putting everything in one basket, but at the end of the day the underlying funds are all near the same anyway due to regulations etc so it's not a massive difference. Otherwise could just take my OM stuff literally "as is" and direct invest it with whoever.
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Me neither. So what's also nice in my opinion about having a few different RAs or preservations funds, is when you retire, you can convert them into life or living annuities as need arises, don't have to do it in one big go.
 
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