Unit trusts

A collective investment scheme ( also commonly referred to as a fund or unit trust) is a form of collective investment constituted under a trust deed. As a unit trust investor, your money is pooled with that of other investors who have similar investment goals.
 
Unit trusts enable investors to invest in a wide range of shares, bonds and other assets using relatively small amounts of money. 

How much your investment grows depends on how much return your unit trust earns, which depends on the performance of the underlying investments that the investment manager chooses. You buy units in a unit trust.  You can buy more units whenever you want to, or you can leave your units to grow. You can see your investment balance online if you log into your online account, and we will send you a statement once a quarter.

What are the benefits of investing in a unit trust?

Tax efficiency

You will be liable for tax on the income generated from your investment at your marginal rate. If you dispose of underlying shares in the investment, or even if you transfer your investments between different funds, you may also be liable for CGT.
In time for your tax return you will receive a certificate setting out the income you received on your investment, e.g. the interest you received on the cash component or dividends you received on the equity component.
The latter is relevant because it will attract dividend tax of 15%. Dividend tax is a withholding tax and gets paid directly to the South African Revenue Service by either the company distributing the dividend or, where relevant, certain other withholding agents.

Investment choice

Prudential regulation

You have access to a range of unit trusts designed to enable you to select one or more underlying unit trust funds to suit your risk profile.

All investment portfolios you select are compliant with Regulation 28 of the Pension Funds Act, to ensure your money is invested prudently across a number of asset classes.

Discipline, flexibility and freedom

You have flexibility in that you may withdraw from the unit trust multiple times and be able to switch between the unit trusts at any time, stop and start contributions without any penalties . 

Transparent fees and regular reporting

All fees are fully disclosed and we will keep you regularly informed on all aspects of your investment. You may also access your investment information online.

Transfer of wealth

Unit trusts do not require a beneficiary and the proceeds of your investment go to your estate when you die, which may mean that it is subject to estate duty. The South African Revenue Service charges a duty of 20% on estates valued above R3.5 million (after allowable deductions), which is subject to change from time to time according to legislation. The executor of your estate will distribute all your assets, including your unit trust investment, according to the provisions of your Will.

Who should consider investing in a retirement annuity?

• You are looking for steady, long-term capital growth
• You are ideally investing for at least three years
• You are comfortable with taking on some risk of market fluctuation and potential capital loss
• You wish to invest in a unit trust that complies with legal investment limits for retirement funds

What are the minimum investments?

The minimum investment is R500 per month. You may also stop contributing at any time without penalty. Escalation rate of 0%, 5%, 10%, 15% or 20% per year.

The minimum once-off lump sum investment is R20,000.

What are our fees?

For unit-trust , our initial advice fee is 1.50% plus VAT.

Our annual advice fee is 1.00% plus VAT, deducted monthly from your retirement annuity account.

For clients with investment portfolio greater than R6 million, our fees are negotiable on a sliding scale. 

Our product providers

Allan Gray

Our Preferred providers

Allan Gray

We select Allan Gray as our preferred provider for the following reasons:

1. Reputable asset management company;
2. Financially sound;
3. Efficient administration platform;
4. Clever use of technology delivers excellent user interface;
5. Excellent staff delivers excellent client service;
6. Low platform administration cost;
7. Select range of good performing unit trusts;
8. Easily creates customisable, informative investment overview;
​9. Enables clients to submit instructions online.