GLACIER FINANCIAL SOLUTIONS PRODUCT SUMMARY

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1 GLACIER FINANCIAL SOLUTIONS PRODUCT SUMMARY Glacier Investment Plan An investment plan allows the investor, together with his/her financial intermediary, to either manage his/her own portfolio of funds, or Glacier can manage the portfolio for him/her via the Portfolio Management Service. A Portfolio Management Service is a wrap fund that the client selects in accordance with his/her risk profile, which is determined with the assistance of his/her financial intermediary. The only type of money that can be invested into the Investment Plan is the client s own money and not money that has been transferred from an approved fund that hasn t been taxed yet. Personal Portfolios Retirement Annuity The retirement annuity enables clients to save for their retirement. They are able to transfer money from approved funds, as well as make own contributions into the annuity. By investing with Glacier, the client is able to invest in a wide variety of funds (own funds or wrap funds) suited to their risk profile. Personal Portfolios Preservation Funds This investment originates from Employers Pension or Provident funds. There are two types of Preservation Funds on the Glacier platform: a Preservation Pension Fund and a Preservation Provident Fund. These funds are basically the same but differ with regard to the retirement benefit payments. Both of these funds allow the client to invest in a wide range of funds available on the Glacier platform. Personal Portfolios Preservation Pension fund At retirement, the following options are available to the client: To take a maximum of one-third in cash less tax and use the remaining two thirds to purchase a living annuity, or To use the full amount to purchase a living annuity. Personal Portfolios Preservation Provident fund At retirement, the client has the following options: To take the full amount as a lump sum less tax, or To take a maximum of one-third in cash less tax and use the remaining two-thirds to purchase a living annuity (the client can take any amount in cash and use the balance to purchase a living annuity), or To use the full amount to purchase a living annuity. A LICENSED FINANCIAL SERVICES PROVIDER FOR INTERMEDIARY USE ONLY

2 Personal Portfolios Investment-Linked Living Annuity This product is available to the client at retirement. When retiring from a Retirement Annuity or Preservation fund, the client can use either all, or some of the money to purchase a Personal Portfolios Investment-Linked Living Annuity. The client will be able to invest the pension benefit in a wide variety of underlying funds. The client is obliged by law to take an income of between 2.5% and 17.5% per annum. This income is paid from the underlying funds. The income will be paid in a frequency selected by the client. This income will be taxed according to the client s PAYE tax scale. The aim of this product is to enable the client to be self-reliant after retirement. Glacier Global Collection Plan This investment option has a Bermudian segregated accounts company as nominee with each plan holder s assets in a separate account. Investment choices are collective investment funds denominated in foreign currency. This option enables the client to invest money directly in foreign currencies. The client only has access to true offshore funds up to R per annum. This amount is for the sum total of all the client s offshore investments per annum. Glacier Global Life Plan This is a Bermudan linked life plan with access to investment choices denominated in foreign currency. The investment choices are mostly collective investments funds (mutual funds). This plan includes an investment strategy to cushion investment values in some of these funds against increased volatility in equity and bond markets. Glacier Vantage Life Plan & Vantage Plan (Endowment & Sinking Fund) The Glacier Vantage Life Plan and Vantage Plan policies are suited to investors who would like to invest for capital growth for at least 5 years. In addition to after-tax returns, the policies offer flexibility, accessibility and tax efficiency. Clients have a wide range of investment choice and can take advantage of the benefits of estate planning. Sanlam Life underwrites these policies. Glacier Retirement Fund Solution Glacier offers a Retirement Fund Solution. With this solution, Glacier offers employees belonging to employers pension/provident funds the option to add the Glacier investment solution to their traditional investment options for investing employee pension/provident fund money. Companies can offer this added option on its employees pension/provident fund, to their executives, etc. Shares One of the options on the Glacier platform is to invest in shares. This option provides the investor with the opportunity to invest directly into any shares traded on the JSE. Glacier has the following stock brokers available: Sanlam Private Investments (SPI) FNB Securities Sasfin NVest Investec Securities Melville Douglas PSG

3 Clients can also access securities directly through Sanlam Private Investments (SPI), a leader in wealth management. SPI, a subsidiary of Sanlam Investments, is a significant private client business in the SA affluent market and has some of the most prominent business personalities and families as clients. Glacier Fiduciary Services Fiduciary services play an increasingly important role in the financial planning process for affluent clients and Glacier offers them through Glacier Fiduciary Services. Glacier Fiduciary Services acts as an independent trustee for trusts, can be appointed as executor on wills and can place the administration of your clients trust business with reputable providers both locally and internationally. Glacier Topcover Glacier Topcover is a unique Glacier branded risk product specifically aimed at the affluent market. It is a new generation product underwritten by Sanlam Life (hereafter referred to as Sanlam ), which enables the client to obtain transparent, low cost risk cover. Glacier Topcover offers the required flexibility to accurately address the client s requirements for cover. Types of transactions Phasing-in Phasing-in is used in unstable market conditions The investor can place his whole or part of his/her investment in a money market fund of his/her choice The money is then gradually transferred from the money market fund into the unit trust funds or wrap fund though a phasing-in action The phasing-in is done over a predetermined period (1-36 months) The client selects the % or number of phasing-in transactions Income Glacier Discretionary Investments Income can be taken on Glacier Investment Plans, but it is not compulsory The income can be taken proportionally from all the collective investment funds or only from the money market fund (if not Fusion) if this forms part of the portfolio Income can be taken from specific funds Any percentage or amount can be taken in income, and there is no minimum or maximum amount The client is required to indicate a payment frequency, that is, monthly, quarterly, half-yearly or yearly The income can be started and ended at any time No income tax is payable on the income Income can only be paid into the client s own bank account no third party payments Personal Portfolios Investment Linked Living Annuity (ILLA) This income is a legal requirement and is thus compulsory The client can take between 2.5% and 17.5% income per annum, which is calculated on the underlying fund value (the maximum income will be determined by different age bands) This can be taken as an amount or a percentage The client is required to indicate a payment frequency, that is, monthly, quarterly, half-yearly or yearly Tax on the income is compulsory and is calculated according to clients PAYE tax scales Income can be revised annually on the anniversary date of the investment Income can only be paid into the client s own bank account

4 Income is payable in advance no income in arrears will be allowed (except for monthly income) Debit Order Debit orders are used when clients wish to fund a recurring investment The client or a third party can pay the debit order Debit orders can be requested with a new application, or done as maintenance on an existing investment A debit order can be cancelled by the client (placed on hold) at any time, and resumed when the client deems fit Debit orders can be requested on Glacier Investment Plans and Personal Portfolio Retirement Annuities only Repurchase Repurchases can be done on Glacier Investment Plans at any time Repurchases do not apply to Guaranteed Income Policies and Guaranteed Capital Policies In the case of Personal Portfolios Preservation Funds one repurchase per transferring fund can be done, if certain conditions are met The client can repurchase an amount, percentage or number of units The client can repurchase from only one fund, from only certain funds, or proportionally from all funds Should the client request to repurchase from a wrap fund, the repurchase will be done proportionally from all the underlying funds Switch A switch is when a client requests to change the composition of the funds in his/her investment plan. The client requests that the capital in one or more funds be moved to one or more other funds. The fund(s) out of which the client moves the capital is/are not the same as the fund(s) to which the client requests to move it. Rebalance A rebalance is when a client requests to reshuffle his/her entire portfolio. The client can choose to invest in a new selection of funds. This can also be done if the client requests to invest different proportions in his/her current underlying funds.

5 Fees Two types of fees are deducted: Initial fees (Glacier & the intermediary) Annual service fees (Glacier & the intermediary) Initial fees are recovered once, before the money is invested. Annual service fees are subtracted on a monthly basis, on the day of the month the investment was issued (e.g. if the money was invested on the 24th of January the service fees will be subtracted every month on the 24th). Note: Service fees are recalculated every month and divided by twelve. All fees deducted before/on a cut-off will be included on the commission statement. The following annual service fees are recovered from the client s investment: Glacier annual fee (sliding scale) Intermediary annual fee (negotiable between 0% and 1%) Portfolio manager annual fee (if invested in a wrap fund) Note: The management companies (MANCOs) also charge initial and annual service fees, which will be included in their prices. Loan (only applicable to Endowment/Sinking Funds) The client can borrow money interest free from his investment. Only one loan is allowed within the 5 year restricted period. The minimum loan amount available is R2000. The loan fee is 0.5% of the loan amount with a minimum of R and a maximum of R The loan fee is only applicable in the first two years of the investment. Whenever an ad hoc investment is done, the loan amount will be recovered first. Partial surrender (only applicable to Endowment/Sinking funds) The client can repurchase money from his investment. Only one surrender is allowed within the 5 year restricted period; thereafter there are no limits on the number of surrenders made, as long as the applicable remaining cash value remains in the investment. Full surrender (only applicable to Endowment/Sinking funds) The client can do a full surrender to the maximum of the premiums paid plus 5% compound interest per year. Should the remaining cash value be equal to or less than R2 500, the client can surrender all the money in the investment. If not, the remaining cash value must remain in the investment until the end of the restricted period. The client is only allowed to do a full surrender (without restrictions) at death, or if he wants to do a partial surrender and the remaining cash value is less than R Regular withdrawal (only applicable to Endowment/Sinking funds) The client can do a regular withdrawal only after the 5 year restricted period.