Have you ever heard of trailing commissions? Probably not. Most of the institutions that rely on them don’t want you to know about them. Trail commissions are a lot like hidden fees and charges, the difference is they recur every so often, usually annually, and are paid to people you may have never met.
At iRefund, we help Australians get those fees back.
What Are Trailing Commissions?
Trail commissions are money you pay (usually unknowingly) to a service provider, advisor, representative or broker every year for as long as you own their investment product. Supposedly, this commission encourages the advisor to review your account or policy and provide you with appropriate advice if changes need to be made. In reality, you’ll probably never hear from that advisor again, unless you contact him or her yourself, and the fees are nothing more than a reward to the advisor for keeping you loyal to the product.
The fees that are charged are based on the value of your investment account so they may change every year, depending on the value of your account. They usually range from .4%-1.2% of the value of the account. This money is then paid to the advisor that worked with you or if you bought the product on your own, the investment company that manages it. It may not sound like much, but 1% of a $100,000 investment is $1,000 a year. The numbers go up based on the value of your investment.
Once investors learn about trailing commissions many ask themselves why someone who doesn’t service their account, or worse, someone whom they’ve never even met if the account was set up by the investor himself, should be paid with their money? That’s a good question and one that we at iRefund help to resolve.
Figuring Out If You Have Trailing Commissions
The most direct way to find out if you’re paying trail commissions is to ask the advisor or representative who worked with you to set up the account. Hopefully they’ll be honest and tell you the truth. If you don’t have anyone to ask, you can always read the investment prospectus, which will indicate whether or not trailing commissions are applied to the investment under the section entitled “Management Fees.”
Trailing commissions are commonly found on:
- Superannuation and Allocated Pension Accounts
- Personal insurance policies
- Home Loans
How iRefund Helps You Get Trail Commissions Refunded
At iRefund we help our members get commission rebates and commission refunds by becoming the broker on their accounts. Once that happens, all life insurance commissions, home loan commissions, superannuation commissions and trail commissions associated with that investment are paid to us. We, in turn, pay those commissions to you.
While we’re at it, we change the entry fees associated with these account to nil. That means you’ll never again lose money to trailing commissions!
No Cost To You
The iRefund commission refund and commission rebate costs you nothing! Here’s how membership works:
We refund 100% your trailing commissions to you after we receive a capped amount of those trailing commissions as payment for our services. Everyone is charged the same amount, no matter how large or small your investment. We don’t think it’s right to have to pay more simply because you have a higher investment portfolio value.
$395 is the amount iRefund receives for our services. That’s it. After that, your trailing commissions are entirely YOURS. And that includes ALL of your trailing commissions. All of your investment accounts are covered under your membership so we only charge one fee. And we receive this fee from trail commissions that are already being paid out, so you owe us nothing out of pocket.