Wealth pricing review Introducing our industry-leading platform pricing
Investments is delighted to inform you that we have found additional ways to offer you better value and more choice. This time our enhancements include industry-leading platform pricing and access to our world-class Outcome-based Solutions portfolio range. Unrivaled access to investment expertise We acknowledge that each investor s investment needs are unique and change as they progress through the different stages of their lives. It is on this basis that we have simplified our investment offering into categories that are simple, easy to understand and will assist you along the journey to improving your financial wellness. We realise that choice is important because it allows you to customise your investment to suit your unique circumstances. In addition to ensuring that we offer one of the most competitive and comprehensive investment ranges in South Africa, we also provide you with access to s leading Outcome-based Solutions portfolio range. At Investments, we believe it is important that you feel confident that the investment components you choose perform in line with your expectations. We have simplified our investment offering by combining our unrivaled expertise and extensive experience in investment mangement to provide you with a leading range of outcome-based portfolios that have been purpose built to maximise the probability of you achieving your desired investment outcome. To provide you with confidence when you invest, the Outcome-based Solutions portfolio range ensures that: Portfolios are built around your needs, not an arbitrary peer group. The probability of you achieving your goal(s) has been maximised. Your portfolio is flexible, adaptable and diversified. Attractive risk-adjusted returns that provide a more consistent investment experience over time are achieved. The risk and temptation of market timing is reduced. Page 2 of 8 wealth fee schedule 2017
Financial adviser fees 2 Initial fees Ongoing fees (yearly) Investment fee schedule Our investment series has a range of investment components, split into three key categories, namely Outcome-based Solutions, Core Portfolio and FundShop. Your investment s platform administration fee depends on your total investment amount with us and the investment components you choose. There are three types of fees that may apply to an investment. These fees may be charged on an initial and/or ongoing fee basis: Platform administration fees for services provided including administration, reporting and consolidation; Financial adviser fees for financial planning and advice given; and Investment management fees, like fund manager fees for the management of your investment. This fee schedule only explains our platform administration fees and the financial adviser fee(s). Please refer to the relevant fund fact sheets for details on fees your investment manager charges. In addition, the fee and benefit proposal will give you a detailed breakdown of all the fees that apply to your investment. Platform administration fees 1 Core Portfolio and FundShop portfolios Ongoing fees (yearly) First R1 500 000 0.50% Next R3 500 000 0.25% Amount above R5 000 000 0.15% The administration fee is subject to a minimum of R45 per month. The minimum fee is waived for all investments with regular contributions. Outcome-based Solutions portfolio range A maximum platform administration fee of 0.30% per year applies for all investments into the Outcome-based Solutions portfolio range. The Outcome-based Solutions portfolio range will attract the lower of the Core Portfolio and FundShop platform administration fees and 0.30% per year depending of the size of the investment. In addition, the minimum fee is waived if you invest exclusively in the Outcome-based Solutions portfolio range. Rebates We support clean priced fund classes. Where the clean class is not available, rebates paid to us will be deducted from your platform administration fees. Additional access fees A fee of 0.15% per year will apply if any of the following are selected: Personal Share Portfolio (this access fee will be waived for Wealth Portfolio Management PSPs and SP Reid Securities PSPs). International administration. offshore capacity. Traded Endowment Option. Transactional fees Switches Immediate payment fee A maximum of R250 per switch (waived if done online) A minimum of R100 Fee aggregation Wealth platform administration fees are based on the total investment value of all your aggregated investments with Wealth. All products except our Retirement Income Option (max 7.5% over the first five years) Max. 4.00% Max. 1.50% Retirement Income Option (max 6.5% over the first five years) Max. 1.50% Max. 1.00% Additional information Direct shares: for the buying and selling of shares, a buy fee of 0.50% and a sell fee of 0.25% apply. These fees include VAT. Further information about the fee structures of the Essential Portfolio range and the Death Benefit Guarantee are available on the fee and benefit proposal. Important notes 1 Add VAT for investments via the Flexible Investment Option. 2 Excludes VAT or adviser distribution fee. wealth fee schedule 2017 Page 3 of 8
Outcome-based Solutions portfolio range The Outcome-based Solutions portfolio range provides you with a comprehensive range of collective investment schemes that optimally blend active and passive mandates to provide you with consistent and robust investment returns within a predefined level of risk. Investment need Capital protection and liquidity Income Real growth with capital protection Asset class exposure Cash and cash plus solutions Multi-asset fixed income solutions Absolute return solutions Portfolio names Money Market Fund Diversified Income Fund Defensive Yield Fund Investment objective STeFI + 0.5% STeFI + 1.0% to + 2.0% CPI + 3.0% Risk continuum Cautious Investment horizon Short term Note: the above mentioned investment objectives exclude platform administration and financial adviser fees. Did you know? For your convenience, this document has been embedded with an innovative QR code TM. Please use any mobile device to scan this QR code TM to acquire further information on s comprehensive Outcome-based Solution portfolio range. Page 4 of 8 investments outcome-based investing 2017
Long term capital growth Multi-asset growth solutions Single-asset growth solutions Cautious Growth Fund Stable Diversified Growth Fund Growth Plus Fund Real Growth Equity Fund Target Cautious Target Stable Target Diversified Target Growth Fund Target Growth Plus Fund of Funds Real Growth Core Equity Fund Real Growth Property Fund CPI + 2.0% CPI + 3.0% CPI + 4.0% CPI + 5.0% CPI + 6.0% Market relative Moderate Aggressive Medium term Long term wealth fee schedule 2017 Page 5 of 8
Frequently asked questions When will the new fee structure become effective? What is the minimum investment requirement from 18 April 2017? What has changed with your new fee structure? Do FundShop fees still apply to new business? Do you consider all my investments with you when you calculate my fees? The new fee structure will be applicable to all new business submitted from 18 April 2017. The following minimum investment amounts will be maintained: R50 000 for lump-sum investments. R1 000 per month for regular investments (or equal to R12 000 per year for other frequencies). The tiered fee scale has been reduced to ensure investors receive even better value. We have introduced further fee reductions for our Outcome-based Solutions portfolio range. We have removed the FundShop loading. We have simplified and reduced our platform loading fees. We have increased the minimum monthly fee to R45 per month (previously R42 per month) and have introduced a waiving of this fee for all investments that fully invest in the Outcome-based Solutions portfolio range. No. The previous FundShop loading has been removed from the new pricing structure. Yes, as part of our platform pricing philosophy we apply investment aggregation. This means that we use your total investment value with us when we calculate your fee percentage. The minimum monthly fees applies on an investment level. See fee examples. What is a clean priced fund? The local and international trend is for increased cost transparency. This resulted in many investment managers launching clean priced fund classes. A clean priced fund class is managed exactly the same as other fund classes with the difference being that the other fund classes include a rebate in their ongoing management fee which is paid to the investment platform. Clean priced funds do not include rebates in their ongoing management fee and often have a lower management fee than other fund classes. What happens to the fund manager rebates? What fee schedule will be applicable to previous generation investments? Where we receive rebates, we will still pass it back to you by reducing your platform administration fee to a maximum of zero. The result of this is a lower administration fee on your investment. Investments made prior to 18 April 2017 will not be immediately affected by the new fee structure. Wealth investors with investments that have been in existence prior to 18 April 2017 will be formally notified on 1 July 2017 on how their policies will be transitioned to a new fee structure. Page 6 of 8 investments outcome-based investing 2017
Can you show me examples of how the new fees may affect me? Minimum monthly administration fee Example 1 - You invest R120 000 in our Core Portfolio range. Using our new tiered fee scale, the monthly platform administration fee is R50 (R120 000 x 0.50% divided by 12). Our minimum monthly administration fee is R45. Therefore, your monthly platform administration fee remains R50 and the minimum administration fee will have no impact. Example 2 - Your investment drops to R84 000 in our Core Portfolio range. Using our tiered fee scale, the monthly platform administration fee is R35 (R84 000 x 0.50% divided by 12). Our minimum monthly administration fee is R45. Therefore, your monthly platform administration fee will increase by R10 per month (R45 R35) to R45 per month. Example 3 - You invest R84 000 in our Outcome-based Solutions portfolio range instead. Using our flat fee for the Outcome-based Solutions portfolio range, the monthly platform administration fee is R21 (R84 000 x 0.30% divided by 12). You are invested in the Outcomebased Solutions portfolio range only, so we waive the minimum monthly administration fee of R45. Therefore, your monthly platform administration fee will be R21 per month. Current fee structure compared to new fee structure Example 1 - You invest R100 000 into the Outcome-based Solutions portfolio range and R100 000 into our Core Portfolio range using a Flexible Endowment Option. The table compares what you would have paid based on our current fee structure compared to our new fee structure. Outcomebased Solutions 1 Allocation Current New 50.00% 0.50% 0.30% Core Portfolio fund 1 50.00% 0.50% 0.50% Total 100.00% 0.50% 0.40% - 20% fee reduction Example 2 - If you invest the full R200 000 into the Outcome-based Solutions portfolio range, you benefit from a platform fee reduction of 40% as shown in the table below. Outcomebased Solutions 1 Outcomebased Solutions 2 Allocation Current New 50.00% 0.50% 0.30% 50.00% 0.50% 0.30% Total 100.00% 0.50% 0.30% - 40% fee reduction Example 3 - The table below compares the fees if you invest R1 000 000 into the Outcome-based Solutions portfolio range and R1 000 000 into our Core Portfolio range. Outcomebased Solutions 1 Allocation Current New 50.00% 0.47% 0.30% Core Portfolio fund 1 50.00% 0.47% 0.44% We use your total assets with Wealth to calculate this fee. Total 100.00% 0.47% 0.37% - 22% fee reduction wealth fee schedule 2017 Page 7 of 8
Want to know more? Contact your Marketing Adviser Call us on 0860 546 533 www.momentum.co.za Disclaimer: The information provided in this document is provided for general information purposes only. The information is not intended to be advice as contemplated in the Financial Advisory and Intermediary Services Act 37 of 2002 (FAIS). The information contained in this document including opinions expressed is derived from proprietary and non-proprietary sources deemed by Wealth to be reliable. It is not necessarily all inclusive but is accurate as at the date of its publication. We do not provide any guarantees about the funds which form part of this fund range and our good governance process cannot prevent fraud. We reserve the right to add, modify, and change certain sections of this document or remove it in its entirety at any time for any reason. You are aware that some of the investment funds named in this document are not necessarily owned and managed by us and may be removed and/or be unavailable in the future. You acknowledge that it is your responsibility to conduct suitability analysis and due diligence on the investment fund as part of your investment mandate with the investor and your investment advice process. General investment risks The investor accepts there are specific investment risks for every type of investment fund, such as shares, collective investment schemes and/ or investment funds. BEFORE SUBSCRIBING TO ANY OF THE INVESTMENT FUNDS OR PRODUCTS CONTAINED IN THIS DOCUMENT, IT IS YOUR RESPONSIBILITY TO READ THE FUND S MDD OR OFFERING MATERIALS. The following risks are specifically mentioned, but not limited hereto, and it remains the investors responsibility to educate themselves and remain informed on investment risks that apply: 1. Collective Investment Schemes in Securities (CIS) are generally medium to long term investments. The value of participatory interests may go down as well as up and past performance is not necessarily a guide to the future. CIS are traded at ruling prices and can engage in borrowing and securities lending. A schedule of fees and charges and maximum commissions is available on request from the company or scheme. Commission and incentives may be paid and if so, would be included in the overall costs. 2. Money market portfolios: The price of each unit is aimed at a constant value. The total return to the investor is primarily made up of interest received but, may also include any gain or loss made on any particular instrument. In most cases this will merely have the effect of increasing or decreasing the daily yield, but in an extreme case it can have the effect of reducing the capital value of the fund. 3. We do not provide any guarantees about the funds which form part of the Outcome-based Solutions local portfolio range. 4. We aim to prevent fraud from taking place. Wealth (Pty) Ltd 268 West Avenue Centurion 0157 PO Box 7400 Centurion 0046 South Africa Tel +27 (0)12 675 3000 Fax +27 (0)12 675 3941 ShareCall 0860 546 533 wealthservice@momentum.co.za www.momentum.co.za Refer to the website for directors and company secretary details Reg. No. 1995/008800/07 Wealth is an authorised financial services provider FSP 657 Terms and conditions apply., a division of MMI Group Limited, an authorised financial services and credit provider. www.momentum.co.za