Should You Be Looking At Unit Trusts For Your Small Business?

by Mike Perk on 04/10/11 at 2:43 pm
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Over the past three weeks I have focused on the importance of offering attractive retirement benefits to staff members if you want your business to attract and retain top staff. Recently I chatted to Wynand Gouws from Old Mutual Investment Group SA about putting attractive and affordable staff retirement benefits at your finger tips.

Traditionally, the only way for smaller businesses to do so was by buying into an ‘umbrella’ fund, which can be costly and administratively intensive. This has changed with affordable and new-generation products such as Old Mutual Unit Trusts Group Solution. This is an easy-to-use, web-based administration system that is free to businesses that wish to offer staff access to an affordable unit trust-linked retirement annuity investment. We briefly discussed what a unit trust is as an investment, and that there are over 1 000 unit trusts currently available to South African investors.

Last week I interviewed Wynand Gouws, Head of Retail Channel Management for OMIGSA. We chatted about unit trusts for small businesses. After the interview Ideate recieved a healthy amount of requests for a follow up, so today I’m asking Wynand to tell us a little more about Old Mutual’s range of unit trusts, including their popular Classic Investment Collection, and why it is so important to invest via an established and a reputable investment company.

Ideate: Are unit trusts suitable for everybody?

Wynand: Definitely. Different categories of unit trusts invest in different assets. Young investors with time on their side are likely to choose equity unit trusts that offer high potential returns over the long term, while people who are near retirement may want to reduce exposure to high risk and focus on preserving their investment capital (savings).

Ideate: Can I change between unit trusts as I grow older?
Wynand: Yes, this is one of the main attractions of investing with Old Mutual Unit Trusts and is called switching. Each investor has a personal investor profile with different needs and goals. As you grow older, or have children, or perhaps start a new venture, your investment profile will change, and you may need to switch between unit trusts in order to make sure that your portfolio remains aligned with your current and future needs.

Ideate: Does Old Mutual Unit Trusts offer unit trusts that will be suitable throughout my life?

Wynand: Yes. Our Classic Investment Collection is a smart selection of five funds that have been especially selected because they meet the needs of most investors – from high risk pure equity funds for young aggressive investors, asset allocations funds with moderate to moderately aggressive return targets, to low risk income funds.

Ideate: So it is a complete solution that is suitable for retirement planning?

Wynand: Yes, the attraction here is that we have selected the unit trusts funds, and the portfolio manager looks after the investment for you. So all you as an investor needs to do is monitor where you are in your life, and make sure you are invested in the appropriate fund as your needs change. I always recommend that investors consult an adviser around the structure of their portfolios.

Ideate: Doesn’t Old Mutual’s complete range include more than 40 funds?

Wynand: Yes it does. For investors who want to structure portfolios with exposure to specific types of assets and risk our range extends from very conservative unit trusts to specialist equity funds that offer concentrated exposure to one specific type of industry or sector, such as gold or property.

Ideate readers: are you interested in offering your staff access to a quality retirement benefit or standard unit trust investment?

Ideate has partnered with Old Mutual to provide special service to entrepreneurs and small businesses on how to structure their salary packages. Click here and fill out the simple form to get started.

[Disclaimer]

Mike is an entrepreneur and managing director of digital marketing agency World Wide Creative. A video blogger for his three favourite subjects: Entrepreneurship (www.ideate.co.za), Web Marketing (www.heavychef.com) and Football (www.free-kick.tv). Follow Mike on Twitter: www.twitter.com/mikeperk View more articles by Mike Perk.

Tags: Africa, entrepreneurship, human resources, old mutual, small business, South Africa, team building, unit trusts

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