When was the last time you actually checked how much your investments are costing you? For many South Africans, investment fees are something that gets mentioned in the paperwork, accepted as part of the deal and then forgotten. A fee of one or two percent a year may sound small until you see what it can take away from your returns over many years. The concern is that many investors do not always know exactly what they are paying, while traditional fees are often linked to the amount of money sitting in their investment rather than the work being done.
That model is now being challenged as technology makes it possible to offer simpler ways of managing investments and charging customers. Fynbos Money says it has introduced a flat fee approach, where customers pay a transparent monthly membership instead of a percentage of their portfolio. The argument is simple: whether you have R100 or R1 million invested, the administration involved does not necessarily increase in proportion to your wealth. Joining us on the line is Adrian Hope-Baili, Co-founder of Fynbos Money