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Get 5% added to your investment upfront when you choose the XtraMax Retirement Annuity.
Get up to 5%
added to your investment upfront
When it comes to investing your money, we know you need the assurance
that your investment has the best possible potential for investment
growth. You also get to choose how
you allocate your investment across a variety of funds.
This is what the XtraMAX Retirement Annuity plan offers you in addition to a little extra upfront.
Each day you make approximately 5000 choices. Some are challenging, some insignificant, and then there are those choices that are logical and make perfect sense. Like choosing a cost-effective investment plan that enhances your investment by adding 5% extra upfront – allowing a higher initial investment to be exposed to market growth from day one. This is just one of the benefits offered by XtraMAX from Old Mutual Max Investments.
When it comes to investing your money, we know you need the assurance that your investment has the best possible potential for investment growth. This is exactly what the XtraMAX Retirement Annuity plan aims to do.
XtraMAX offers the following features:
Before you start selecting your funds you should establish your investment goals and objectives with your adviser or broker. Types of investment portfolios to consider:
The next step is to design your portfolio. You have three ways to select your XtraMAX fund structure:
All funds offered on an XtraMAX RA are Regulation 28 Compliant.
Offering you real value for money - XtraMAX offers very low charges thanks to the low maintenance associated with our tracker funds. We’ve selected a range of funds that gives you good value for money and we’ve negotiated fees where applicable. The minimum five-year investment term in particular investment funds gives us the time needed to offer part of the upfront amount.
The Old Mutual Xtra Protected Life Fund guarantees that your investment value would never be lower than 85% of the highest value ever reached on any one day that you are fully invested in the fund.
Own Choice Funds
Minimum fund allocations vary according to your selected investment objective profile.
What is Reduction in Yield (RIY)?: If the fund performs at 10% but your money only grows at 7% (after deducting costs), then RIY is 3% (10% minus 7%). That means that 3% is used to cover costs. A lower RIY can have a huge impact on the final amount that you receive (lower charges = greater earnings). So when choosing your investment solution, it’s important to take RIY into account.
Depending on how you tailor your XtraMAX plan, the RIY can be as low as 0.7% a year on a retirement annuity (based on a R50 000 initial investment without the upfront and ongoing commission paid to the intermediary).
You choose how you allocate your investment across the core funds and own choice funds at the start of your XtraMAX investment, as long as it’s within limits. The upfront enhancement is included in the total value that you allocate to your chosen funds. Once you have allocated your core funds, you must remain in those core funds for the full five years. You have the freedom to switch between own choice funds during the five-year term as many times
as you like, at no charge. The minimum allocation into any fund is 5%.
What happens at the end of the five years? At the end of the five years, XtraMAX will continue as a standard Max Investments Flexible Retirement Annuity Plan. Your investment in core funds will be switched into default funds chosen by Old Mutual. These default funds are similar to the ones that you were originally invested in. Investments in own choice funds can remain as is. You will also have access to the full range of funds offered by Max Investments; and have the freedom to switch funds as often as you like – at no charge. Standard South African Retirement Annuity Fund rules will apply to the XtraMAX Retirement Annuity and these rules will continue after the five years when it becomes a Max Investments Flexible Plan.
What happens if you disinvest before five years? There will be a fee charged on the amount you disinvest, if you do so within the first five years. This is to recover the upfront enhancement. This fee will apply if you disinvest in order to transfer to another retirement fund (Section 14 transfer), retire early or are involved in divorce settlements or emigration. It also applies to the termination or cancellation of the plan or opting out of XtraMAX.
At Old Mutual, we’re the first to point out that there are many investment solutions in the market. Most are similar, at face value that is. Look a bit deeper and you’ll understand why XtraMAX is the logical choice for the investor with a minimum term of five years. For more information on our other XtraMAX product, please visit the Voluntary Investment Plan page.
Alternatively, speak to your Old Mutual financial adviser or broker or call 0860 WISDOM (0860 947 366).
Tel: 0860 60 60 67