Tower Trust has released a new do-it-yourself (DIY) complying pension on the market to sit alongside its existing range of DIY superannuation products.
Peter Burgess, Tower Trust’s manager superannuation services, says the increasing popularity of the DIY complying pension rests on the ability to distribute residual amounts at death or completion of the payment period without jeopardising Centrelink and reasonable benefit limit concessions.
Burgess says traditional life company complying pensions are generally subject to the same rules but with a key difference.
Life companies normally provide a guarantee that the complying pension will be paid for life or the nominated term, however, the downside is any residual amount may not be distributed in full or at all to beneficiaries.
On the other hand, DIY funds only require actuarial certification that there is a “reasonable profitability” that the assets are sufficient to meet all pension payments.
In a DIY fund it may be possible that the assets supporting the complying pension may run out prior to death or the completion of the payment term or there could be residual amounts.
“In these situations, the trustee of a DIY fund may be permitted to distribute the remaining amounts to yourself or in the event of your death, to other fund members or to your estate,’ Burgess says.
“It is really an issue of weighing up the peace of mind that guaranteed payment term provides, against the peace of mind knowing that any unused or residual amounts may be distributed to your beneficiaries on death.”
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Fiducian has included an adviser share option plan (ASOP) in its prospectus to encourage “the commitment of adviser groups to support Fiducian and assist in the delivery of superior services to clients”.
The funds management and financial planning firm was due to list on the Australian Stock Exchange on September 12.
Adviser groups will be invited to participate in the ASOP with the number of options issued to be determined based on income generated for Fiducian each financial year.
The maximum number of options calculated for each adviser group will not exceed 20 per cent of the total options issued to the groups.
Fiducian has also set the limit on the adviser group options at no more that 15 per cent of all issued shares in a financial year.
Wine Venture
A new West Australian wine production and tourism company has released a prospectus aiming to raise $36.87 million.
Settlement 22 plans to develop a 113 hectare vineyard on the Margaret River offering investors the opportunity to buy into a tax effective managed investment scheme or shares in the company that owns the land and other assets.
Head of Settlement 22, Cedric Williamson, says the unique structure will “create wealth by providing investors with exposure to both the attractive earnings and the significant capital growths that can be generated by successful premium wine producers”.
The managed investment scheme requires a minimum investment of $12,650 payable over three years while investors will have to spend a minimum of $3663 to purchase shares in Settlement 22 Estate.
Absolutely AM
AM Corporation has launched a fund aimed at conservative investors looking for positive yearly results with a reasonable margin over cash.
The AM Absolute Return Fund seeks to outperform cash by three per cent and to provide only positive returns over rolling 12 month periods with low volatility.
The fund is an open-ended investment with free and unlimited switching available.
AM says the fund will invest in three broad categories; high yield debt strategies, specialist alternative funds and specialist funds of alternative funds.
“By using specialist managers which solely assess other managers, AM can invest in a large variety of specialist funds complete with active monitoring and reporting,” AM says.
The AM Absolute Return Fund has $104 million under management and comprises 5 per cent of The AM Balanced Growth Fund.
Five Arrows go retail
Rothschild Australia Asset Management has added an international retail fund and a wholesale trust to its product range.
The Five Arrows Discovery Global Fund and the Rothschild Discovery Global Value Wholesale Trust will be managed on Rothschild’s behalf by US funds manager Putnam Investments. Rothschild formed an alliance with Putnam last December.
The new wholesale fund has a minimum entry level of $100,000 while the Five Arrows retail fund with a nil entry fee, has a minimum initial investment of $10,000.
Mark Watmore, Rothschild manager product development, says Putnam portfolios typically include exposure to at least 10 countries and up to 225 stocks.
“The new fund and trust are managed according to Putnam’s Global Value Equity approach, which is to invest in companies that are cheap relative to their earning power and are undergoing positive change,” Watmore says.
