This month our experts put Aegon Scottish Equitable's Wealth Management Portfolio under the microscope
By Steven Whalley, head of marketing – investment products at Aegon Scottish Equitable
Wealth Management Portfolio
The Wealth Management Portfolio bond (WMP) is an offshore portfolio bond which gives investors access to open architecture investment. This means they can invest in an array of collective investments including deposit accounts and some hedge funds.
The fund choice is divided into three areas:
• Aegon Scottish Equitable International (ASEI) Portfolio funds. A wide choice, many with a lower yearly disclosable charge, including:
– innovative collections
– managed funds
– manager of manager funds
– sector funds
• ASEI Preferential range. We have got around 1,000 collective investments with over 700 having no initial charge, and many with lower annual management charges than normally available. And if renewal commission is paid we will rebate it back to the client's cash account.
• ASEI Universal acceptable assets range. Clients can hold a vast selection of other collective investments, many of which they wouldn't normally be able to invest in, and we will often be able to buy them at a reduced cost.
Flexibility of charging
The charging structure is clear and flexible, allowing advisers to put together their own structure or pick one from the five standard shapes. Our product costs are covered by one portfolio charge as you can see in the table and we don't have any fixed charges or transaction charges (within reasonable limits).
Portfolio charge each year
Portfolio valuePortfolio charge (wrapper)
£15k – £149,9990.7%
£250k – £499,9990.25%
£500k – £999,9990.2%
The cost of advice can be built into the charging structure by way of an initial or an establishment charge – our design is flexible enough to allow advisers to spread the costs of advice to suit their clients' circumstances. For example, 1% commission equals:
• 1% reduction in allocation, or;
• 0.22% pa establishment charge payable for five years with cash-in charges equal to outstanding establishment charges, or;
• 0.15% pa establishment charge payable for eight years with cash-in charges equal to outstanding establishment charges.
Extra allocation can be built into the contract by paying a greater establishment charge, over five or eight years, if required, on the same basis.
There will normally be an annual management charge for the underlying investment and there may also be an (explicitly agreed) investment adviser fee.
Service standard of provider
Our full service offering covers online valuations, online dealing, investment profiler tools and pre-sale service through Aegon Scottish Equitable branches, supported by a team of offshore specialist sales managers.
We publish our service commitment for post sale activity from Dublin. Some of the key processes include:
• new business notification – same day
• policy documents issued – four working days
• dealing – placed within 24 hours
• regular withdrawals – within 48 hours
Quality of technical support
Technical support on tax and trust issues is provided by Aegon Scottish Equitable's leading tax and trust support team and sales network. Aegon Scottish Equitable International uses its expertise to produce training and business development material, most of which is available on the website.
Value for money
This is very good value for money, given the investment choice, service, commitment, online valuations and pre-sale support offered, along with a tax-efficient tax wrapper, all for a modest portfolio charge.
We don't have a quarterly administration charge or dealing fees for the first 25 deals, making the product clearer than other offshore bonds that do. This should facilitate an even greater acceptance as offshore portfolio bonds as it is simpler and nearer to the structure of a bond only offering insured funds.
*If the investor is a corporate client and the amount being invested is over £1m or for any other investor investing more than £5m, terms will be agreed on a case-by-case basis.
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