For many people, retirement is a daunting topic associated with a constant worry whether you’ve made enough provision for this period of your life.
That’s why it’s important that you start asking the right questions and making plans to ensure you’ll be in a good position by the time you retire. This is where Portfolium steps in. This financial services firm offers customised financial planning services in partnership with their retirement fund clients to the members of these funds.
The high cost of retirement products has long been a pressing concern in South Africa’s financial landscape. Since as far back as 2012, the National Treasury has been urging the financial industry to address these excessive fees, even hinting at regulation if no progress was made.
Our success in securing institutional pricing embodies what we call the “Retirement Revolution”, where retirement savings benefit the members – not the service providers. This disrupts a system that has functioned this way for decades.
Charl Swart, Managing Director of Portfolium
Charl Swart, Managing Director of Portfolium, at a recent client event. PHOTOS: NATALIE GABRIELS PHOTOGRAPHY
When cost-controlling “default regulations” designed to reduce fees for retirement products finally took effect on 1 March 2019, major financial players showed little interest. Now, nearly five years later, it’s fair to ask: why hasn’t the industry embraced these reforms?
The default regulations require retirement fund trustees to safeguard members’ interests by offering fund-endorsed annuity products, giving members the choice to remain with their retirement fund post-retirement. With these trustee-endorsed annuities, retirement funds can negotiate institutional pricing, significantly lowering fees for members.
The issue, however, may lie in competition: by offering their own products, these trustee-endorsed annuities compete directly with high-fee products from large financial product suppliers or institutions.
The head of annuities at a big corporate investment company highlighted this point during the Institute of Retirement Funds Africa conference, noting that of 100 standalone funds that selected this company as their default provider, only 37 saw any uptake in the past four years.
How Portfolium can help you
Portfolium, in collaboration with retirement funds, has taken a proactive stance. It is committed to “enhancing outcomes” for retirement fund members in full alignment with the default regulations.
“Acting as a disruptor, Portfolium has introduced low-cost living annuities, retirement benefit counselling, and institutional priced asset management fees,” says Charl Swart, Managing Director of Portfolium. “This approach has guided thousands of members toward more secure retirements.
“As an independent service provider for the past seven years, Portfolium has your best interest at heart. We strive to create simple, cost-effective investment solutions for all fund members.
“Our success in securing institutional pricing embodies what we call the ‘Retirement Revolution’, where retirement savings benefit the members – not the service providers. This disrupts a system that has functioned this way for decades.
“The future of retirement planning lies in these reforms, which have the potential to reshape the industry by prioritizing lower fees and better member outcomes – a shift, or disruption if you will, that could empower retirees across South Africa,” Swart says.
Portfolium’s focus is on building their relationship with you, whether you are:
- An individual retirement fund member,
- A trustee on the board of a retirement fund, or
- An employer providing your employees with a retirement fund.
They are strongly member-driven, and provide the best independent financial guidance and investment solutions for retirement fund members, which support positive financial outcomes before and after retirement.
Portfolium’s team members fulfil different roles. From left is Bongiwe Sohaba, Wealth Planner, Monrico Arries, Client Relationship Manager, and Chlo Thomas, Office Coordinator.
Their offices are strategically located to provide face-to-face counselling and financial advice, which supports the take-up of trustee-endorsed annuities. This personalised approach aids members in making well-informed retirement decisions.
Their services include developing annuity strategies and products for retirement funds. They are counselling members to ensure that they understand their options at retirement. They provide holistic financial planning incorporating other assets, financial products and generational wealth services.
The traditional financial advisor’s compensation system does not fit the low-cost model. In a survey a while back, a large financial institution posed the question: “Retirement funds and advisors – oil and water?”
“Portfolium recognised this as a real opportunity for change. We partnered with proactive retirement funds, combining our expertise with their bargaining power to create high-quality and affordable solutions. This approach allowed us to reduce fees, offer low institutional pricing, and ensure members experienced higher returns over time, significantly improving income sustainability. Portfolium has no conflict of interest and will always give preference to the retirement funds’ annuity strategy and institutionally priced products before considering any other available options,” Swart says.
Some of Portfolium’s clients include Consolidated Retirement Fund, National Fund for Municipal Workers, CSIR Pension Fund and Telkom Retirement Fund.
Portfolium and client engagement
Portfolium recently held a few client conferences across the country to inform active and retired members of retirement funds about the exclusive benefits that their retirement fund offers in accordance with the default regulations.
Craig Gibson touched on topics such as retirement capital, product fees, market declines and fund annuity products.
Clients were informed of the current state of the financial markets and were given feedback on their investment returns and the impact of costs on retirement. These measures help safeguard members while navigating complex pension fund products, and provide critical information to make informed decisions.
Contact Portfolium today for a consultation session before making decisions about your retirement fund benefits.