It’s always great to operate in a country where savings, investments and pensions are encouraged at a young age and in the work place. As a business we very rarely come into contact with professionals in South Africa that do not have some form of insurance, investment or pension which is fantastic. That said, it is staggering to see how many have not had a fee and/or structure check within the last two years or even at all since they started a specific policy.
Since Carrick Wealth ventured into the local South African market with the launch of “integrated financial planning” we have placed a large emphasis on providing fee and structural checks for professionals across the country so they may ascertain if their policies are still as cost effective as they once were and to see if the trust, wrapper or platform still makes viable sense for them as a vehicle.
What we are mainly finding out is, that the client often isn’t aware of:
- High cost funds paying their adviser a “trail” commission
- Poor performing funds compared to others on the market
- Higher than average adviser on-going costs
- Multiple charging structures over numerous policies instead of one consolidated structure
- All funds provided by a single asset manager
- Trusts that no longer have the same benefits they did at set up due to legislation changes
- Zero offshore exposure
- Life insurance/critical illness policies not being updated to reflect current liabilities
- Archaic pricing structures that are out of date for retirement annuities (RA), insurances and investment policies
- Old RA’s that could form part of your estate
- Business assurance that neglects new key personnel
- Buy-and-sell agreements set up incorrectly or not updated to reflect current company valuations
All of the above, and more, findings can be solved very simply, quickly and could have huge financial benefits to your overall financial portfolios. These changes could also lead to avoiding some very large costly future issues.