ENDOWMENTS

Introduction

An Endowment Plan is an investment plan which allows the investor to create wealth tax-efficiently. This plan benefits investors with a marginal tax rate greater than 30% and a minimum investment time horizon of 5 years.

Further Info

WHO CAN INVEST?
  • Individuals
  • Trusts
GENERAL TAX BENEFITS
  • Investors with tax rates greater than 30% will benefit from an investment within an Endowment Plan.
  • Income tax of 30% and Capital Gains Tax (CGT) of 12% applies to individuals and trusts (with natural persons as beneficiaries) within the Endowment Plan.
  • The individual interest and CGT exemptions are not utilized and remain intact.
BENEFITS AFTER END OF RESTRICTION PERIOD
  • Regular withdrawals after the 5-year restriction period may have tax benefits to the investor/plan holder.
  • If a person is making regular withdrawals from the Endowment Plan to supplement their annuity income, the annuity income can be reduced. A reduction in annuity income, which is subject to tax at the investor’s marginal rate, will result in a reduction of the investor’s income tax liability.
  • Withdrawals from the Endowment Plan are treated as capital reductions and thus are not subject to income tax, but are subject to CGT.
BENEFITS ON DEATH
  • No CGT, where plan is transferred to a nominated beneficiary.
  • No executors’ fees where a beneficiary is nominated.
  • Plan holder proceeds are transferable directly to the nominated beneficiaries, and therefore are not trapped as part of the frozen assets in the deceased’s estate.
  • Estate duty may be applicable.
CONTRIBUTIONS
  • During the first 12 months there are no restriction on the amount that can be contributed.
  • From year 2, the maximum allowable contribution is 120% of the total contributions for the previous 2 years (where applicable), whichever is the higher.
ACCESSIBILITY
  • Withdrawals are restricted during the first 5-years (one interest free loan and one surrender); however, after 5-years regular withdrawals are allowed.
  • Withdrawals during the 5-year restriction period are limited to premium/ contributions made plus 5% compound interest per annum.
NEGOTIABILITY

The Endowment Plan may be ceded or pledged as security.

Unit Trusts

Fairtree Worldwide Multi-Strategy Flexible Prescient Fund

The Fairtree Worldwide Multi-Strategy Flexible Prescient Fund aims to provide maximum long term growth by investing in a diversified blend of worldwide assets and strategies. This is not constrained by Regualtion 28 and it is our best opinion on a balanced investment view. The objective is to provide competitive after inflation annualized returns measured in rand over a 5 year period.

Fairtree Flexible BALANCED Prescient Fund

The Fairtree Flexible Balanced Prescient Fund is a Regulation 28 fund. It combines a diversified blend of worldwide assets, at a low cost. The equity allocation uses systematic quantitative factor-based strategies, with a fundamental active overlay. The objective is to provide competitive after inflation annualized returns measured in rand over a 3 year period.

Fairtree INVEST STRATEGIC FACTOR Prescient Fund

The Fairtree Invest Strategic Factor Prescient Fund is a Regulation 28 fund. Where our other two funds are 'all about the investment journey, this fund is more 'about the destination'. It combines a diversified blend of worldwide assets, at a low cost. The equity allocation maximized, still using systematic quantitative factor-based strategies, with a fundamental active overlay. The objective is to provide competitive after inflation annualized returns measured in rand over a 5-7 year period.

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MDD
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MDD

PORTFOLIOS

Fairtree High Growth PORTFOLIO

The Fairtree High Growth Portfolio aims to outperform the benchmark net of investment management fees, over any rolling 7 year period. The portfolio is diversified across the major asset classes utilizing a multi-­manager approach, whereby fund managers are combined based on their skills and expertise.

FAIRTREE HIGH NET WORTH GROWTH PORTFOLIO

The Fairtree High Net Worth Growth aims to provide an aggressive risk growth opportunity by blending a combination of both local and offshore equity. The portfolio aims to outperform the benchmark over a rolling five year period.

FAIRTREE GROWTH HEDGE FUND OF FUNDS PORTFOLIO

The Fairtree Growth Hedge Fund of Fund Portfolio aims to provide an aggressive risk growth opportunity by blending a combination of well diversified alternative asset classes and uncorrelated investment strategies. The portfolio targets to outperform the benchmark over a rolling five year period. Investors benefit from the exposure of award winning funds as well as robust capital allocation framework. The portfolio manager aims to provide investors with a combination of attractive returns and downside risk mitigation.

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HOW IT WORKS

To start a New Investment is a three step process. We will guide you along each step because with us, it is all about the journey.

STEP 1

CLIENT DETAILS

Please complete all fields in the Client Information document to avoid delays in processing your investment. You may email the completed document to clientservices@fairtreepc.com or you can email it directly to your Fairtree Private Client financial advisor.

STEP 2

INVESTMENT DETAILS, SIGNATURES AND OUTSTANDING DOCUMENTS

We will pre-populate your forms for you and contact you to complete your investment information section. Along with your pre-populated forms, we will request documents which we require in order to complete your instruction.

You will simply need to:

  • Validate and sign your pre-populated application forms
  • Send through the required supporting documents which we will ask you for.

STEP 3

Make Payment

Your investment will be finalized by setting up a debit order or initial investment contribution. 

START STEP 1 FOR INDIVIDUAL INVESTORS
START STEP 1 FOR ENTITY INVESTORS

“Because with us, it’s all about the journey.”

0861 000 712

clientservices@fairtreepc.com

Fairtree Private Client (Pty) Ltd is an Authorised Financial Services Provider. (FSP 12179)