Affinity Consulting Group


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Affinity Consulting Group




Objective: This plan is intended for regular savings. It should not be taken out unless you intend to contribute for the majority of the term. Once started it must be continued for 18 months but thereafter payments can be reduced or stopped and restarted without penalty to meet changing circumstances. Lump sums may be added at any time and withdrawn without penalty at any time. At maturity the plan pays out in full - it does not provide a pension.

Liquidity:The first 18 months of your regular contributions plus the first 18 months of any increase are used to purchase initial units. These have a penalty if you withdraw them before the end of your plan. They also carry a penalty if you do not complete the first 18 months contributions (which can be up to 100%) or the first 18 months of any increase.

All regular payments after the first 18 months are used to purchase accumulation units. Lump sums can be added at any time and also purchase accumulation units. All accumulation units can be withdrawn without notice at any time.

Bonus:The first 18 months contributions are enhanced by 5% for $500 or more per month. This is increased to 10% for contributions of $1000 or more. For contributions over $2000 an additional 1% is added for each year of the plan up to a maximum of 15% bringing the max bonus for $2000 or more to 25%.

Duration: At the choice of the client. This has to be decided at the outset and it is usual to take it to retirement age. This is because growth rates can be high and it would be annoying to receive high growth for the duration of the plan and then have it pay out only to put the money on a lower fixed interest deposit or start another plan and have charges again. At the end of the term the money can be withdrawn or left in to continue growing, however no more contributions are allowed.

Charges: The initial units have a charge of 1.5% per quarter and there is a plan fee of $6 per month.

There is no entry cost (bid-offer spread) for regular payments, they buy units at the bid (exit) price. However lump sums will be subject to a bid-offer spread of 7%, that is they are deposited at the offer price and immediately drop down to the bid price. All withdrawals and switches between funds are done at the bid price.

There are other hidden charges, taken out before the funds are priced and so are not seen:

  • FPIL take 1.2% pa out by reduction of the fund prices each day. The performance of the mirror funds are therefore 1.2% pa less than the underlying funds being mirrored.
  • The funds themselves have internal charges (but have been selected based on their net performance).

The figures below show the annual fund growth required to cover the product charges:

Monthly Premium (USD)

Savings Term $250 $500   $1,000
5 Years 4.3% 3.0% 2.2%
8 Years 2.1% 2.0% 1.6%
10 Years 1.9% 1.6% 1.3%
15 Years 1.2% 1.0% 0.9%
20 Years 0.8% 0.7% 0.6%
25 Years 0.6% 0.5% 0.4%

The table shows that for longer terms and higher contributions, the costs associated with this plan reduce. For monthly contributions of US$2,000, the contributions receive an even greater level of allocation (up to 125%) and so the charges are marginally lower than for the $1,000 level illustrated. The level of returns required to produce a positive real return on your savings plan is, therefore, lower for longer maturities and for higher contribution levels.

Switching: Investors can select up to 10 funds and there are no charges for switching between funds and as a "fund of funds" strategy can involve many switches, then other plans with a lower fixed charge would ultimately prove more expensive.

Waiver of premium: This option if taken, protects your savings if you are unable to work. If you cannot work for more than 6 months, temporarily or permanently, then FPIL will pay your premiums for you from the 7th month until maturity or until you work again. The cost of this varies with age and premium.

Premier Savings Plan Key Facts

Premier Savings Plan Brochure

Premier Savings Plan Technical Guide

Premier Savings Plan Application Form

Premier Savings Plan Application Form for Additional Life Insurance / Premium Protection

Direct Charge Authority Form

Banker's Standing Order Form

Bank Instruction Form

Fund Transfer Request Form

Withdrawl / Surrender Form

FPIL Savings Plan
FPIL Lump Sum Plan
FPIL Portfolio Bond
FPIL Whole of Life Insurance
Royal Skandia Pension Plan
Royal Skandia Investment Bond