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An effective selection process?

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Financial Adviser Selection

These are the guys that do the admin
1What to consider?
Five questions to ask:

1- Experience: How many years do they have in the industry?

2- Knowledge: Do they understand every aspect of the financial products are recommending?

3- Qualifications: Are they a CFP? What professional industry qualifications do they have?

4- Independence: Can the recommend financial products from multiple suppliers (like Allan Gray) or are they forced to only recommend products from one supplier?

5- Remuneration: Are they remunerated upfront only or is there an ongoing fee. A lower upfront fee with an ongoing trail fee is preferred because it financial incentives a financial planner to provide good ongoing service.

2Estimate cost?
Modern investment products normally consist of two fees charged by financial planners:

1- Upfront fee: This is a once off fee applied to a new flow of money into an investment. Average upfront fee charged is 1.5%

2- Ongoing fee: This is an ongoing fee, expressed as an annual percentage, but deducted monthly.Average ongoing trail fee charged is 0.5%

Note: Insurance based investment products are normally expensive in the long run and extremely inflexible.

3How to start?
Four sources to find a financial advisor:

1- Independant Financial Advisors on Allan Gray's Website★★★★★

2- A firm I worked with. Two CFP's and they are Independant.★★★★★

3- How to confirm a financial advisor is a CFP★★★★☆

4- Another potential source★★★☆☆

4What did I do?
Why don't I use a financial planner

Short anwser: I was a CFP and have the knowledge to run my own financial affairs.

Long anwser: For new investors, that need to start saving for retirement or some other goal, the knowledge is out there. Use the Resources page to understand the basics of investment products and if need be consult a certified financial planner.

Continue using Finance Spotlight as a tool to teach yourselve.


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Administration Platform Selection

These are the guys that do the admin
1What to consider?
Three important aspects:

1- Admin Fees: What are the admin fees charged? Are there hidden costs?

2- Service: Do you get quick and friendly service. Do they appreciate your business or are you just another number?

3- Usablility: Can you log in online and invest or disinvestment easily? Can you easily pull a statement on your investment? Do you have control over your investment?

2Estimate cost?
There should be only one simple to understand administration fee

Admin fees are usually charged on a sliding scale. Meaning the more you invest the lower the admin fee will be.

Ranges between 0% to 0.75%

3How to start?
There are many administration platforms in South Africa.

Allan Gray★★★★★

Coronation★★★★☆

Momentum Wealth★★★★☆

Glacier★★★☆☆

PSG★★★★★

Satrix★★★★☆

4What did I do?
I use Allan Gray for the following reasons:

1- Competitive fees

2- User friendly online system with powerful reporting tools

3- Simple to understand processes

4- Excellent service

5- An amazing call centre. ★★★★★ for this!


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Investment Product Selection

These are the guys that do the admin
1What to consider?
Five questions to ask:

1- Experience: How many years do they have in the industry?

2- Knowledge: Do they understand every aspect of the financial products are recommending?

3- Qualifications: Are they a CFP? What professional industry qualifications do they have?

4- Independence: Can the recommend financial products from multiple suppliers (like Allan Gray) or are they forced to only recommend products from one supplier?

5- Remuneration: Are they remunerated upfront only or is there an ongoing fee. A lower upfront fee with an ongoing trail fee is preferred because it financial incentives a financial planner to provide good ongoing service.

2Estimate cost?
Modern investment products normally consist of two fees charged by financial planners:

1- Upfront fee: This is a once off fee applied to a new flow of money into an investment. Average upfront fee charged is 1.5%

2- Ongoing fee: This is an ongoing fee, expressed as an annual percentage, but deducted monthly.Average ongoing trail fee charged is 0.5%

Note: Insurance based investment products are normally expensive in the long run and extremely inflexible.

3How to start?
Four sources to find a financial advisor:

1- Independant Financial Advisors on Allan Gray's Website★★★★★

2- A firm I worked with. Two CFP's and they are Independant.★★★★★

3- How to confirm a financial advisor is a CFP★★★★☆

4- Another potential source★★★☆☆

4What did I do?
Why don't I use a financial planner>

Short anwser: I was a CFP and have the knowledge to run my own financial affairs.

Short anwser: For new investors, that need to start saving for retirement or some other goal, the knowledge is out there. Use the Resources page to understand the basics of investment products and if need be consult a certified financial planner.

Continue using Finance Spotlight as a tool to teach yourselve.


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Unit Trust Selection

These are the guys that do the admin
1What to consider?
Five questions to ask:

1- Experience: How many years do they have in the industry?

2- Knowledge: Do they understand every aspect of the financial products are recommending?

3- Qualifications: Are they a CFP? What professional industry qualifications do they have?

4- Independence: Can the recommend financial products from multiple suppliers (like Allan Gray) or are they forced to only recommend products from one supplier?

5- Remuneration: Are they remunerated upfront only or is there an ongoing fee. A lower upfront fee with an ongoing trail fee is preferred because it financial incentives a financial planner to provide good ongoing service.

2Estimate cost?
Modern investment products normally consist of two fees charged by financial planners:

1- Upfront fee: This is a once off fee applied to a new flow of money into an investment. Average upfront fee charged is 1.5%

2- Ongoing fee: This is an ongoing fee, expressed as an annual percentage, but deducted monthly.Average ongoing trail fee charged is 0.5%

Note: Insurance based investment products are normally expensive in the long run and extremely inflexible.

3How to start?
Four sources to find a financial advisor:

1- Independant Financial Advisors on Allan Gray's Website★★★★★

2- A firm I worked with. Two CFP's and they are Independant.★★★★★

3- How to confirm a financial advisor is a CFP★★★★☆

4- Another potential source★★★☆☆

4What did I do?
Why don't I use a financial planner>

Short anwser: I was a CFP and have the knowledge to run my own financial affairs.

Short anwser: For new investors, that need to start saving for retirement or some other goal, the knowledge is out there. Use the Resources page to understand the basics of investment products and if need be consult a certified financial planner.

Continue using Finance Spotlight as a tool to teach yourselve.

0
Do you need a financial Planner?
1
Which administration platform will you use?
2
Which investment product do you need?
3
Which unit trusts will you invest in?
 

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