Sharon Fernandesz
Advisermag Product Spotlight

Get more with IOOF WealthBuilder

By Sharon Fernandesz, Senior Manager - Investment Products Strategy

In this new era of financial services reform, IOOF stands ready to assist financial advisers with flexible product features designed to specifically meet these challenging times.

New industry codes are scheduled to take effect from 1 July 2012 and along with the Government’s proposed Future of Financial Advice reforms, we will see the cost of financial advice being separated from the financial product.

Many advisers and their clients are already shifting towards a more transparent advice fee model in anticipation of these reforms.

More flexible adviser commission and service fee options

The recent product enhancements we have made to IOOF WealthBuilder (WealthBuilder), our investment bond offering, have been designed to provide flexibility to both advisers and clients alike by offering partial and full rebates of commission. The optional new adviser service fee (ASF) also gives advisers maximum flexibility to set advice remuneration as they require.

The new commission and service fee options for WealthBuilder are:

  • Flexible ongoing (trail) commissions – advisers can now choose to rebate part or all of their ongoing (trail) commission.

    WealthBuilder’s ongoing commission has historically been a set value - a fixed percentage pa bundled within the management costs of the WealthBuilder Funds (Funds).

    From 1 August 2010, advisers have the ability to rebate part or all of their ongoing commission if they choose. Whilst full management costs will continue to apply, advisers can now negotiate a reduced ongoing commission with their clients, which will be applied as a rebate (or credit) to the client’s account.

  • Optional ASF – providing greater flexibility for advisers to tailor fees to suit their clients’ changing service needs.

    An optional ASF has also been introduced. The ASF offers a fully flexible remuneration alternative, offering both dollar and percentage based options and can be charged on an ongoing and/or once-off basis.

    The ASF is a separately negotiated (and agreed) arrangement between adviser and client and may be charged as an alternative to, or in addition to, the standard upfront and ongoing commission structures offered under the WealthBuilder product.

Revised fees and costs for the Custom Choice Options

Since 1 August 2010, IOOF has reduced the base management cost for all Custom Choice Options from 1.90 per cent pa to 1.80 per cent pa.

The revised fees and costs were made in consideration of the overall potential impact of fees and costs for investors, following the introduction of some underlying investment managers who have the ability to charge performance fees from time to time.

To learn more

Further information about these enhancements is included in the new IOOF WealthBuilder Product Disclosure Statement which was issued on 1 August 2010.

Alternatively, advisers can contact their IOOF Business Development Manager or call Adviser Service on 1800 659 634.