Why?
We take away a smaller portion of your gains to cover our expenses.
Here is a comparison of the charges:
NTUC Similar
Income Fund
Initial spread 3.5% 6%
Annual fee 1% 1.5%
Assume that you invest $100,000 for 20 years to earn an average gross return of 7% per annum.
After deducting the initial spread and annual fee, you will get the following amount at the end of 20 years:
From NTUC Income $309,000
From similar fund $274,000
Difference $ 35,000
NTUC Income gives you 13% more than the similar fund.
Wait! Here are some more facts!
1. Be careful of other funds that have even higher charges, as they give even less to you.
2. During 2003 to 2005, the Global Equity fund of NTUC Income earn an average of 19.2% per annum, compared to an average of 15.1% for 17 similar funds tracked by Standard & Poors.
3. If you have already invested in a high charge fund, you can switch to NTUC Income now, and earn more for your remaining years!
3 comments:
Currently fund distributors only charge 2.5% or less for unit trusts. In addition they offer a lot of different funds. To compete, I think Income should offer lifestyle funds.
Reply to globevestor.
During our promotion, we offer 1$ or 2% bonus units. This reduces our spread to 2.5% or 1.5% respectively.
Most funds have higher annual charges, ie more than 1% per annum. Or, they may have trailer charges. This hits the investor more than the initial spread.
NTUC Income's funds have low charges, overall.
chong,
Your wife & you investing $100 each month. That would be $1,200 or $2,400 a year, depending on whether it's $100 per couple or $100 per person.
For $200 per mth, even if there are no charges involved & the return is pure 6% pa, you will be getting only about $60,000 at the end of 15 years.
Even at 9% pa, your retirement nest will only be approximately $76,000.
Unless this is only a small part of your retirement fund, $76,000 will not even be enough for 1 person to retire, needless to say 2.
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