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OPN Endowment Plan - Endowment Plan _OPN_.FH11

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OPN Endowment Plan - Endowment Plan _OPN_.FH11 Powered By Docstoc
					                                       OPN Endowment Plan
The OPN Endowment Plan is a tax-efficient investment vehicle                 Surrender value
which is structured with the creation of long-term wealth in mind.           You are entitled to one withdrawal during the initial restriction
It is most suitable if you fall into a marginal tax rate greater             period of five years or any extended restriction period. The
than 30% and have a minimum investment time horizon of five                  withdrawal value is limited to your contributions plus 5%
years.                                                                       compound interest per year. If the actual market value of the
                                                                             OPN Endowment Plan is less than the legal surrender limit, the
While access to capital is limited within the first five years or extended   market value (less any deductions such as tax) will be paid
restriction period, this plan offers significant tax benefits. Taxable       to you.
income for you (interest, net rental income and foreign dividends)
is taxed at 30%, while realised capital gains attract capital gains          Withdrawals from your OPN Endowment Plan are not limited once
tax at 7.5%. The proceeds of a withdrawal from the plan are tax-free         the initial five-year restriction period, as well as any further restriction
in your hands. All tax reporting responsibility is removed from you,         periods which may have been applied, have expired.
the Investor.
                                                                             Cessions
The OPN Endowment Plan offers a simple and transparent cost                  A PPS Endowment Plan may be ceded outright or partially.
structure and allows you unlimited flexibility in changing your
underlying investments as well as managing the timing of                     Loans
investments into your plan.                                                  You are entitled to one Non-interest Bearing Loan/Zero interest loan
                                                                             during the initial restriction period of five years. The zero interest
KEY BENEFITS AND FEATURES                                                    loan value is limited to the amount invested plus 5% compound
Investment Options                                                           growth per year. You have the right to pay the amount taken as a
The range of Investment Options offers a selection of multi-managed          loan back into the endowment structure without breaking the
OPN unit trusts that provide clearly defined underlying investment           restriction period. There will however be no obligation on you to pay
choices. We also give you the choice of a selection of top-performing        back this loan. There will also be no interest payable from the
single-manager unit trusts to ensure that you have a varied and              amount taken. The amount of loans you can take after the five year
well-defined range of alternatives.                                          restriction period will be unlimited but the same rules as with
                                                                             withdrawals will apply.
Switching
You may change your Investment Options as often as you choose                Death benefits
without incurring a transaction fee. Certain underlying asset managers       Upon your death, the proceeds of your OPN Endowment Plan will
do, however, charge an initial upfront fee for investment in their           flow directly to your beneficiaries, tax-free in their hands. This will
Investment Options, which would be applied upon your switch into             save your estate up to 4% (including VAT) in executor's fees.
those Investment Options.
                                                                             Cooling-off period
Transfers                                                                    A 30-day cooling-off period applies from the date that you receive
You may not transfer your OPN Endowment Plan to another endowment            your OPN Endowment Plan policy summary and its terms and
policy or transfer another endowment policy into the OPN Endowment           conditions. Should you choose to terminate your investment within
Plan.                                                                        this period, your original investment amount will be returned to you
                                                                             but may be reduced as a result of market losses. No interest or
Restriction period                                                           investment return will be paid or accrued to you. This option will
The OPN Endowment Plan has an initial restriction period of five             not be available to you if you have made any switches to your
years. You may make additional contributions to your plan at any             investment selection or if any benefit has been paid within the
time, subject to set minimum investment amounts. Should the                  cooling-off period.
contributions, however, exceed 120% of the greater of your annual
contributions in the prior two-year period, your investment will enter
an extended restriction period for another five years from the date
of the contribution.
Minimum investment                                                                                                                     ADMINISTRATION FEES
Lump sum:      R10 000                                                                                                                 Initial fees
Recurring*:    R 500 per month                                                                                                         No initial fees.
Ad hoc:        R5 000
                            * The minimum recurring debit order amount for a member                                                    Ongoing fees
                            under the age of 30 is R200 per month, which should be escalated
                            to the normal minimum of R500 per month after the member’s                                                 An ongoing administration fee of 0.80% is charged annually. Your
                            30th birthday.
                                                                                                                                       fee may be reduced by a sliding scale and partnership savings that
                                                                                                                                       we have negotiated with the managers of the Investment Options
Tax                                                                                                                                    featured on our administration platform.
Taxable growth (interest, net rental income and foreign dividends)
is taxed at 30% for individuals and the proceeds of a withdrawal                                                                       Your annual administration fee is calculated as follows:
from the plan are tax-free in your hands. All taxes due and payable
are paid by Coronation Life and recovered by Coronation Life from                                                                           1)      OPN Endowment Plan invested in any of the OPN
your OPN Endowment Plan. All tax reporting responsibility is removed                                                                                Multi-Managed unit trusts
from you, the Investor.
                                                                                                                                                    Your annual administration fee is 0.80%
FEES                                                                                                                                                Subtract the partnership saving of 0.80%
There are three types of fees:                                                                                                                      Leaving a net annual administration fee of 0%

Intermediary fee (initial and ongoing)                                                                                                      2)      OPN Endowment Plan invested in other 3rd party
Payable to your accredited Intermediary. (if applicable)                                                                                            Investment Options

Administration fees (initial and ongoing)                                                                                                           Your annual administration fee is 0.80% and can be reduced
Payable to PPS Investments.                                                                                                                         by the following:

Asset manager fees (initial and ongoing)                                                                                                            a. A sliding scale that reduces your fees depending on your
Payable to the manager of the unit trust(s) that you select.                                                                                           investment amount i.e. the higher your investment
                                                                                                                                                       amount, the lower your annual administration fee. Refer
                                                                                                                                                       to the OPN Endowment Plan application form for more
                                                                                                                                                       details.
                                                                                          Asset
                                                                                         Manager
                                                                                            A
                                                                                                                                                    b. The partnership saving – for example.
     YOUR                                                Administration                   Asset
                             Intermediary                  Company                       Manager
  INVESTMENT
                                                        PPS Investments                     B                                            Investment amount                 Scaled                  Partnership               Actual
                                                                                                                                                                      administration fee             saving             administration fee
                                                                                          Asset                                                  R1mil                       0.65%                    0.46%                    0.19%
                                                                                         Manager
                                                                                            C


                                                                                                                                       ASSET MANAGEMENT FEES
                             Negotiated
                                                           Ongoing                      Initial and
                                                                                                                                       Initial fees
                             initial and                                              ongoing asset
                                                         administration                                                                No initial fees are charged on investments into the OPN Multi-Managed
                              ongoing                        fees                     manager fees
                             advice fees
                                                                                                                                       unit trusts. Should you choose to invest in one of the 3rd party
                                                                                                                                       Investment Options, an initial fund management fee of 0.29% may
                                                                                                                                       be charged by the fund manager. Currently none of the 3rd party
FEES                                                                                                                                   Investment Options, on our platform levy fees.
Initial fees
This fee is negotiated between you and your Intermediary and ranges                                                                    Ongoing fees
from 0% to 3.42%.                                                                                                                      The annual asset management fees vary depending on the unit trusts
                                                                                                                                       you select. These are fully disclosed on the Investment Option schedule;
Ongoing fees                                                                                                                           please see application form for details.
Annual fee is negotiated between you and your Intermediary and
ranges from 0% to 1.14% per annum. The maximum ongoing fee                                                                             * All fees include an amount calculated to compensate for VAT costs.
is limited to 0.57% if the initial fee is greater than 1.71%.




                                                                                     PPS INVESTMENTS (PTY) LIMITED REG NO: 2005/029098/07
                                                  7th FLOOR, MONTCLARE PLACE, CNR CAMPGROUND AND MAIN ROADS, CLAREMONT, 7708, PO BOX 44507, CLAREMONT 7735
                                                    DIRECTORS: EA MOOLLA (CHAIRMAN), NJ BATTERSBY, CK DE KLERK, MJ JACKSON, PJ KOEKEMOER, HA NELSON, AC PILLAY
                                                                       CLIENT SERVICE: 0860 468 777 (0860 INV PPS) www.ppsinvestments.co.za

Disclaimer: The information, opinions and any communication from the PPS Investments group, whether written, oral or implied are expressed in good faith and not intended as investment advice, neither does it constitute an offer or
solicitation in any manner. Furthermore, all information provided is of a general nature with no regard to the specific investment objectives, financial situation or particular needs of any person. It is recommended that investors first obtain
appropriate legal, tax, investment or other professional advice prior to acting upon such information. All reference to tax is under current tax legislation. Please refer to product rules or contact a tax specialist for more information. PPS
Investments (39270) and PPS Multi-Managers (28733) are licensed financial services providers