The Old Mutual Invest Flexible Plan is a unit trust investment plan offered by the Old Mutual Investment Group. The product is intended to provide investors with flexibility in terms of investment options and investment periods. In this review, we will look at the product in greater detail and analyze its features, benefits, and downsides.
Features
The Old Mutual Invest Flexible Plan enables customers to invest in a variety of underlying unit trusts based on their investment goals and risk tolerance. The product provides four risk profile choices, ranging from conservative to aggressive. The program also enables investors to move between risk profiles in response to changing investment demands and market conditions.
The program allows users to invest for as little as one month or for as long as they choose. Investors are free to make further contributions or withdrawals at any time, with no penalties or fees. The tool also allows investors to make recurring contributions by debit order, making it simple for individuals to stick to their investing goals.
The product has four risk profiles: conservative, moderate, growth, and aggressive.
Investors can choose from a variety of underlying unit trusts, each with its own investment objectives and risk profile.
The annual management fee for the Conservative option is 1.14%, 1.28% for the Moderate option, 1.42% for the Growth option, and 1.56% for the Aggressive option.
Aside from the management fee, investors must also pay underlying unit trust costs, which vary depending on the unit trust chosen.
The product requires a minimum monthly payment of R500 or a one-time lump sum investment of R5,000.
Investors can make additional contributions or withdrawals at any time, with no penalties or costs.
The Old Mutual Invest Flexible Plan had more than R14 billion in assets under management (AUM) as of February 2023.
Benefits
The flexibility provided by the Old Mutual Invest Flexible Plan is one of its primary advantages. Investors can select from a variety of underlying unit trusts based on their investment objectives and risk tolerance. The program also allows investors to swap between risk profiles, which is very handy during market turbulence.
The product also allows investors to make additional contributions or withdrawals at any time, with no penalties or costs. This is especially helpful for investors who need to access their funds for unanticipated needs or to capitalize on investing possibilities.
Another advantage of the Old Mutual Invest Flexible Plan is its tax-efficient structure. Because the product is organized as a unit trust, investors are only taxed on their investment gains rather than the underlying.
Drawbacks
The product’s management costs are one of the key disadvantages of the Old Mutual Invest Flexible Plan. The product has an annual management fee as well as underlying unit trust fees, which can be quite substantial when compared to alternative investment options. This can reduce an investor’s returns, especially in times of low investment returns.
Another disadvantage of the product is its lack of transparency on the underlying unit trusts. Investors do not have direct access to the underlying unit trusts and do not have full visibility into the fund managers’ investment decisions.
Conclusion
The Old Mutual Invest Flexible Plan is a unit trust investment plan that provides clients with investment options and term flexibility. The program is intended to provide investors with the flexibility to make further contributions or withdrawals at any time, with no penalties or costs.
The product is tax-efficient, making it an appealing investment alternative for those wishing to reduce their tax bills. However, management costs are charged by the product, which might reduce the investor’s returns.
Overall, the Old Mutual Invest Flexible Plan is an excellent investment choice for investors seeking flexibility and simplicity. However, investors should evaluate the product’s management fees as well as the lack of transparency surrounding the underlying unit trusts.
