Get a Low-Cost Investment Portfolio With Advicement

No Financial Advisors

Advicement does not have financial advisors, nor their high salaries. As a result of this, we can pass benefits to our clients in the form of our low fees. In fact, our total effective cost is approximately 50% of the typical financial advisor.

No Unnecessary Fees

When investing with Advicement, you pay a brokerage fee of 0.25% and an annual management fee of 1.00%. There are no financial advice fee, no initial fees, no exit fees and most importantly no hidden fees.

Fees Impact Your Returns

So which fees should concern South Africans? The short answer is all of them. Below is a cost comparison between Advicement and a typical South African financial advisor.

Investment Fees Comparison on R100 000

When investing, you should always know what you are paying in terms of fees and their purpose.

Brokerage/Administration Fee

Brokerage fees are paid to the investment administrator for buying the underlying funds or ETFs on behalf of a client. For South African financial advisors, the administrator is usually a company called a LISP (linked investment service provider).

Easy Equities is our sole execution partner. They have one of the lowest brokerage fees in South Africa allowing us to bring performance benefits to our clients.

Type of Advisor Fee (%) Paid Frequency Approximate Fee on
R100 000 Investment
Advicement 0.25% * Once off R250
Typical Financial Advisor 0.50% * Annual R500
* Please note these values do not include fees charged when trading on the JSE.

Initial Advice Fee

Initial advice fee is deducted from the invested amount immediately to compensate financial advisors for the time spent with their clients. Currently, there is discussion whether it is fair to charge such fees as they can be detrimental to the growth of the investment in the early stages.

Advicement does not charge an initial advice fee, which allows our clients to have a better start in achieving their financial goal.

Type of Advisor Fee (%) Paid Frequency Approximate Fee on
R100 000 Investment
Advicement 0.00% - R0
Typical Financial Advisor 0.50% * Once off R500
* Please note that these figures can be negotiated with the financial advisor and largely depend on the amount you are investing.

Annual Advice Fee

On top of the initial advice fee, financial advisors also charge an annual advice fee for maintaining client portfolios and updating them on their performance. This fee is deducted annually, and if high enough it may significantly erode the final value of the investment.

Advicement does not charge any advice fees. We believe that our technology empowers our clients and removes the need to pay these fees.

Type of Advisor Fee (%) Paid Frequency Approximate Fee on
R100 000 Investment
Advicement 0.00% - R0
Typical Financial Advisor 1.50%* Annual R1 500
* Please note that these figures can be negotiated with the financial advisor and largely depend on the amount you are investing.

Management/Product Fee

The management/product fee is paid to the product providers for creating and managing the underlying investment products. This fee can range widely depending on the investment chosen by you or your financial advisor. Typically, active products charge higher fees while passive products have a lower cost.

Advicement uses passive products and manages them on the Easy Equities platform. The annual management fee for Advicement portfolios is 1.00%. Please note that this does not include the cost of the passive products inside the portfolios, which is typically in the region of 0.40%.

Type of Advisor Fee (%) Paid Frequency Approximate Fee on
R100 000 Investment
Advicement 1.00% * + ETF fees Annual Approximately R1 400
Typical Financial Advisor 1.50% Annual R1 500
* Advicement charges this fee to monitor and re-balance the Advicement portfolios. A client will pay this fee when purchasing an Advicement portfolio. The underling ETF fees are already present in the ETF price and are not paid directly by the investor. The underlying ETF fees are typically in the region of 0.40%.

Other Fees

Other costs could include Performance Fees, Termination Charges, Penalties, Guarantees, Risk Benefits, Wrap Fund Charges, etc. It is important to understand these fees and the reason behind them since any additional charges will ultimately hamper the performance of your investment.

Advicement does not charge any other fees apart from the ones mentioned above. We pride ourselves on being transparent and cost efficient.

Effective Annual Cost

Typically, after investing R100 000 with a financial advisor in South Africa, you will approximately pay about R4 000 in your first year of investment. This amount can be even greater depending on the arrangement with your financial advisor.

The effective estimated annual cost of using Advicement is approximately R1650. Keeping fees to the minimum is one of the most important considerations when saving and investing.

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