What is Sales Charge?
Sales Charge Fee is a one time fee deducted from your investment when you invest into Unit Trust/Mutual Fund. Basically a large portion of this Sales Charge fee goes toward paying the commission of agent or consultant. This is considered a fair amount if you are satisfied with the service and advisory provided by the agent or consultant. Under most cases, Sales Charge for cash investment through an agent ranges between 5% - 6% of the invested amount.
How is Sales Charge Calculated?
Sample Calculation:
- Investment Amount : RM1000
- Sales Charge : 5%
Sales Charge Calculation
= Investment Amount - [(Investment Amount x 100% / (100% + Sales Charge)]
= RM1000 - [(RM1000 x 100% / (100% + 0.05%)]
= RM1000 - (RM1000 x 0.95238
= RM1000 - RM952.38
= RM47.62
Based on the sample calculation above, for every RM1000 you invest in RM47.62 worth of sales charge is deducted. The balance of RM952.38 will be invested into the fund of your choice.
What If?
What if we can save by paying lower sales charge?
What if there's an avenue that offer Sales Charge at only 2% instead of 5%-6%? How much can you save?
Let us take a look at a sample calculation of how much savings you can make by paying 2% sales charge instead of 5%;
Let us take a look at a sample calculation of how much savings you can make by paying 2% sales charge instead of 5%;
Sample Calculation:
- Investment Amount : RM1000 per month
- Investment Period : 5 years (60 months)
Total Sales Charge Incurred via 5%
= RM1000 - [(RM1000 X 100% / (100% + 0.05%)] x 12months x 5years
= RM47.62 x 12months x 5years
= RM2857.20
Total Sales Charge Incurred via 2%
= RM1000 - [(RM1000 X 100% / (100% + 0.02%)] x 12months x 5years
= RM19.61 x 12months x 5years
= RM1176.47
Difference
= RM2857.20 - RM1176.47
= RM1680.73
By paying 3% lesser on sales charge, you are able to save up to RM1680.73 over a five year period. That's more than 1.5 months worth of money which you can use to reinvest!
The above example is calculated based on RM1000 per month worth of investment. What if you are putting aside RM2000 or even RM3000 per month? Imagine how much more you can save!
How to Invest at only 1.5% Sales Charge?
The answer is through an Online Platform called eUnitrust!
What is Eunittrust?
Eunittrust is the first online unit trust platform that offer investor an option to take control and manage their own investment. It is managed by Phillip Mutual Berhad and is recognized by Securities Commission. You may research about Phillip Mutual Berhad through Google and verify the credibility of the company with Securities Commission Malaysia if you are in doubt.
Benefits offered by Eunittrust;
1. You can now buy, sell and monitor your unit trust investment online at only 2% sales charge. The best thing is that Eunittrust also carry out regular promotional campaigns whereby you can invest for as low as 0% sales charge!
2. You get to choose from a vast variety of unit trust funds (>200 funds) from famous Fund Houses such as Kenanga, Eastspring, RHB, AmBank, Manulife, Affin Hwang and many more. This allows you to have a wider option of top performing funds to choose from instead of just buying funds from an agent affiliated to only one company in particular.
3. You are in control of your own investment. By that I'm referring to the power of investing directly via your PC/Laptop.Mobile. Investment transaction is made easy through online banking as compared to traditional practice of issuance of check or bank deposit slip.
4. There's no risk of losing your money even if the online platform closes down. That is because the platform acts as a medium to help you invest with the fund house of your choice. For example if you invest in Kenanga Funds, the platform helps you to invest directly with Kenanga. Know that your investment is then passed on to Kenanga and not kept/held by the online platform. Therefore even if Eunittrust shuts down, your investment is still kept safely and recorded with Kenanga.
5. There's NO Registration Fee and NO Annual Fee for opening an account with Eunittrust. As a matter of fact, you can open an account without any obligation to invest. Look at it as having a tool ready for use when you ultimately decide to invest.
How to open an account with Eunittrust?
Open an account NOW by heading over to their registration page at Eunittrust. Registration is quick and easy too!
As an added bonus, once you've opened an account with Eunittrust, drop me an email at shanesee03@gmail.com and I'll send you my ebook on "The Basics of Investing In Unit Trust" absolutely FREE!
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