Download Tariff of Charges Part 2: Investment Product Charges

FINANCIAL PLANNING
Tariff of Charges
Part 2: Investment Product Charges
For customers receiving personalised advice through a Nationwide Financial Adviser
This document sets out the product charges that apply where you invest through our Financial Planning Service, including examples of the
effects that these charges will have on your investments, having received advice from a Nationwide Financial Adviser. You should also refer
to the Tariff of Charges Part 1: Adviser Charges for details of the advice charges that will apply and the benefits you’ll receive.
Please refer to the Self-Directed Tariff of Charges if you would like further details of the charges that apply to customers investing without
advice. This is available online at nationwide.co.uk/investments
Assumptions
We have provided example scenarios within this document to give you an idea of what effect the Fund, Platform and Ongoing Service charges may have on your investment.
We have used the following assumptions when calculating these examples:
•
•
•
•
Investment growth 6% p.a.
An average Fund Charge of 0.72% p.a.
An Ongoing Service Charge at a rate of 0.75% p.a.
A Standard Platform Service Charge of 0.39% p.a.
We have assumed these growth and fund charge rates as they are representative of the typical rates available via funds offered by Nationwide but these rates are not
guaranteed. If the growth rate of your investment exceeds this, the actual amount you pay will be higher. If the growth rate is lower than this, the charges will be lower. Your
Ongoing Service Charge and Platform Charge may also differ, please refer to your suitability letter for confirmation of your individual charges.
The scenarios shown in this document do not take into account any initial charges or rebates that might be applied to the funds you invest in.
Platform Charge
(Only applicable to Unit Trusts, OEICs and Stocks and Shares ISAs)
This fee is collected by Cofunds Limited to cover their costs in administering your Investment(s). The platform is required as it handles all of your payments and transactions
and allows you to switch between different funds should you wish to. This charge is calculated daily and collected monthly based on the value of your investments and taken
from your Platform Cash Account.
Your Platform Charge will be applied as one rate regardless of how much you have invested. The amount of the charge will also depend on which Platform Service applies to
your investments:
•
•
Primary Investment Service. If you have access to a range of funds provided by Legal & General only, a flat rate charge of 0.31% will be applied.
Standard Platform Service. If you have access to the full range of funds from different fund managers, a flat rate charge of 0.39% will be applied.
Example
If you were to invest £40,000 (following the deduction of the Initial Advice Charge) in funds using our Standard Platform Service, you would pay a total
charge of £156 p.a.
The Platform charge is calculated daily and collected monthly based on the value of your investments and taken from your Platform Cash Account.
Product Charge
(only applicable to Select Portfolio Bond)
A charge of 0.45% p.a. is collected by Legal & General to cover their costs of setting up the Bond and the ongoing administration. This charge is calculated and collected
monthly based on the value of your investment in the Bond. The charge is collected by deducting units from your Bond each month. You will receive a Personal Illustration
showing the impact of the appropriate charges, including the Product Charge.
Fund Charge
This charge is taken into account when working out the unit price and is used to pay the fund managers (e.g. Henderson, M&G, Invesco Perpetual) who buy and sell assets to
try and provide positive returns.
The Fund Charge varies by each fund with each charge negotiated on your behalf to ensure that you have access to some of the UK’s leading fund managers at competitive
rates. In some instances we have been able to negotiate that part of the Fund Charge is returned to you. This is called a ‘rebate’. Rebate amounts will be invested as units (once
the amount reaches a minimum of £2.50) into the largest fund of the product that the rebated fund is held in.
Rebates to Unit Trust/OEIC fund charges are taxable as income and any amount used to buy units will be net of basic rate tax at 20%. This means that if you’re a higher
rate or additional rate taxpayer, you may have a further tax liability to pay. If you’re not liable to income tax, you may be able to reclaim some or all of the tax deducted from
HM Revenue & Customs. Please note that for Stocks and Shares ISA investments, rebates on fund charges will not be subject to income tax.
Please note that for Select Portfolio Bonds, rebates do not apply.
Please refer to the most recent fund tables or Key Investor Information Documents for the most up to date fund charges.
Cumulative Effect of Charges
We have provided the following scenarios to give you an idea of what effect the Fund, Platform and Ongoing Service charges may have on your investment.
Scenario 1: Investing a lump sum
End of Year
1
3
5
10
£40,000 lump sum investment into Accumulation units (i.e. any income generated by the funds is reinvested)
Effect of Platform
Effect of Ongoing Service
Cumulative Effect of
Effect of Fund Charge
Charge to date
Charge to date
Charges
£303
£164
£315
£782
£1,002
£543
£1,043
£2,587
£1,842
£997
£1,918
£4,757
£4,710
£2,551
£4,906
£12,167
Assuming that the fund has grown by 6% p.a. over 10 years, the charges in effect reduce the net growth to 4.05% p.a.
Scenario 2: Investing regularly
£500 regular monthly premium paid in advance into Accumulation units (i.e. any income generated by the funds is reinvested)
Effect of Platform
Effect of Ongoing Service
Cumulative Effect of
End of Year
Effect of Fund Charge
Charge to date
Charge to date
Charges
1
£24
£13
£25
£63
3
£221
£120
£230
£571
5
£649
£351
£676
£1,676
10
£3,047
£1,651
£3,174
£7,872
Assuming that the fund has grown by 6% p.a. over 10 years, the charges in effect reduce the net growth to 4.05% p.a.
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We are able to provide this document in Braille, large print or audio format upon request. Your local branch will
arrange this for you or you can contact us on 0800 30 20 11.
Important Information
Investments are provided through Legal & General Assurance Society Limited (Select Portfolio Bond) and Cofunds Limited
for the provision of Investor Portfolio Services and facilitation of dealing.
Nationwide Building Society is authorised by the Prudential Regulation Authority and regulated by the Financial
Conduct Authority and the Prudential Regulation Authority under registration number 106078. You can confirm
our registration on the FCA’s website www.fca.org.uk or by contacting the FCA on 0800 111 6768.
Nationwide Building Society. Head Office: Nationwide House, Pipers Way, Swindon, Wiltshire SN38 1NW.
P2718 (November 2016)