Around 50 IFAs specialising in investment have taken advantage of a new system called Transact, which saves registered representatives around 30 per cent of their time in administration, reduces back-office work and pays a standard commission of 3.5 per cent plus 0.55 per cent trail on all investments in unit trusts, investment trusts and shares. In effect, it gives IFAs a fee-charging structure which avoids any conflict of interest and builds up value for the IFA because they will attract a secure annual income. The client avoids a lot of form filling and hassle, while the system gives them secure internet access to their portfolios with daily valuations.
The system also provides twice-yearly comprehensive statements, which should help the client with their tax returns.
All stockbroker and fund manager communication is handled by Transact and all dividends, income payments and tax and charge rebates are collected by Transact. Individual shares can also be included in the service, which makes life much easier for the investor and IFA. Some transactions can be arranged online if clients use Pin numbers. Furthermore, cash withdrawals can be made on a regular basis and are paid directly into the client's bank account. IFAs have access to all their clients' accounts on the internet and commission of 1 per cent is paid on any switches, whether they are initiated by the IFA or the client. Over the longer term, this service can be cheaper for the client, too.
Both IFAs and their clients should welcome this system, especially as it enables IFAs to include investment trusts and stocks and shares cost-effectively in their clients' portfolios and valuations.
This is excellent service and well worth investigating.