Tax-effective fund offering launched

Generation-Life/Redpoint-Investment-Management/federal-election/Labor-Party/Lucy-Foster/

30 May 2019
| By Hannah Wootton |
image
image
expand image

Generation Life and Redpoint Investment Management have partnered to launch a tax effective fund offering, which will offer investors a tax rate of nine to 11 per cent, making it lower than the 15 per cent offered by superannuation.

Generation Life hoped that the Tax Effective Australian Share fund would reduce the impact of tax paid by investors by delivering higher than expected returns through the compounding effect of lower annual tax payments, compared to what they could get from a domestic share-based managed fund.

The launch came in the wake of the Federal election, where the cost of tax on investors proved to be a focus for voters following the Labor Party’s franking dividend reform proposal.

Generation Life’s joint chief executive and managing director, Lucy Foster, said that advisers needed to be more proactive in considering the impact of tax on clients’ returns, shifting their focus from before-tax performance.

“Our modelling shows that tax can be the single biggest drag on what an investor can receive from their investment,” she said. “The recent focus on lowering investment fees and the effect that has on performance has led to the rise of index-based investing. While focussing on fees has merit, the reality is that the biggest cost of any successful investment is tax.”

Generation Life predicted that the new fund could improve take-home returns by 56 per cent.

Read more about:

AUTHOR

Recommended for you

sub-bgsidebar subscription

Never miss the latest news and developments in wealth management industry

MARKET INSIGHTS

So we are now underwriting criminal scams?...

1 month 3 weeks ago

Glad to see the back of you Steve. You made financial more expensive, not more affordable as you claim, and presided ...

1 month 4 weeks ago

Completely agree Peter. The definition of 'significant change is circumstances relevant to the scope of the advice' is s...

4 months ago

Entireti has unveiled the new name for the AMP financial advice businesses that it acquired last year....

3 weeks 3 days ago

A Sydney financial adviser has been permanently banned from providing any financial services, with the regulator deriding his “lack of integrity, trustworthiness and prof...

2 weeks 2 days ago

The Federal Court has made interim orders to freeze the assets of a managed investment scheme, its responsible entity, and a director....

1 month ago

TOP PERFORMING FUNDS