One of Singapore’s top platforms is iFast and this article will go through and review this platform. I will compare it to other options that expats and PRs have in Singapore.
iFAST Corporation is a wealth management fintech platform, with assets under administration of approximately $12.59 billion as of 30th September 2020.
Incorporated in the year 2000 in Singapore, iFAST Corporation provides a comprehensive range of investment products and services to financial advisory firms, financial institutions, banks, multinational companies, as well as retail and high net worth investors in Asia.
The company is also present in Hong Kong, Malaysia, China and India.
What is iFAST?
iFAST is one of Singapore’s largest independent investment platforms. FSMOne, iFAST is the B2B arm while FSMOne is the B2C platform.
However, what makes iFAST different from FSMOne is that iFAST provides an all-in-one system for financial advisors to manage your investments for you.
From creating an account, managing fees and monies involved, and choosing the funds to invest in, your financial advisor can do everything from scratch for you.
Why iFAST as an Investment Option?
Product Offerings
iFAST is a great investment option for you due to the wide array of products it offers. iFAST’s competitive advantage lies with its ever-expanding suppliers of fund houses, insurers, and banks.
With more suppliers and its all-in-one offering, B2B customers are attracted to them as it provides them with ease in managing their clients’ investment portfolios.
And with more B2B customers using iFAST, more suppliers will continue coming on board to offer these B2B customers solutions to you as the consumer.
For you, this means that if you take up your financial advisor’s offer to invest via iFAST, there are more funds for them to choose from that could generate better risk-adjusted returns for you.
Unlike, a lot of investment products that get recommended to both Singapore nationals and expats, this has no lock-in periods and expats are free to move in and out whenever needed.
Reliability
Licensed and regulated by the Monetary Authority of Singapore (MAS), your money and securities are kept separate from the company’s. They are also subject to strict regulations to ensure that their operations are in line with MAS’ guidelines.
So if you’re worried about iFAST potentially going bust or running away with your money, it’ll unlikely to do so.
Typical fees and charges you might need to pay if you engage a financial advisor for iFAST
There are different fees and charges involved when engaging a financial advisor to invest for you via iFAST.
Depending on much the IFA charges. this would normally be a percentage of AUM 0.5%-2%.
The fees of iFAST do depend on the amount and the funds and dealing charges but the fees are taken from their website
https://www.ifastgm.com.sg/igm/home/pricing-structure
| Your Assets | Charges |
| First 100k | 0.28% p.a. |
| Next 150k | 0.25% p.a. |
| Next 250k | 0.20% p.a. |
| In excess of 500k | 0.10% p.a. |
Is Investing Through iFAST Better Than Regular Savings Plans in Singapore?
The main difference between RSPs and iFAST is the fees involved where RSPs are cheaper.
However, regular savings plans require you to make investment decisions on your own, thus the lower fees.
iFAST investments however are managed by your financial advisor. Therefore the higher fees are used to pay your FA for their time, effort, and expertise.
If you’re confident in your fund selections, an RSP can be better for you.
However, if you’re not, your FA might be able to produce better returns for you (after fees) should you decide to opt for iFAST.
Personally, very much in favour of any platform over the RSP plans as personally find them awful and expensive and mainly “sold” for commission other than best interest.
Is Investing Through iFAST Better Than ILPs in Singapore?
This is one of the most commonly asked questions we’ve received from our readers – and it’s not without merit.
Based on us crunching some numbers, here are our answers:
- If you’re investing for longer than 10 years, iFAST will not perform better than ILPs.
- If you’re investing for 10 years or less, iFAST will perform better than ILPs.
Why?
We made a few assumptions when making this calculation.
iFAST sales charges are set to 2% and AUA fees are 1% per annum.
We’ve also selected the Manulife InvestReady Wealth II as the ILP for our comparison due to it having the lowest fees amongst ILPs – 2.5% per annum for the first 10 years and 0.7% per year thereafter.
Assuming 6% annualised returns and $1,000 monthly investment for both iFAST and ILPs, we’ve found that iFAST outperforms the Manulife InvestReady Wealth II for the first 11 years.
From the 12th year onwards, the Manulife InvestReady Wealth II performs better than iFAST as the fees dropped significantly from 2.5% to 0.7% with no transaction fees incurred.
Furthermore, ILPs come with bonuses to further grow your money that iFAST doesn’t come with.
However, it’s important to note that the number of years is affected by your total yearly investments as the bonuses you’ll receive is dependent on how much you invest with the ILP.
In our assumption, we chose a monthly investment amount that maxes out the bonuses from the Manulife InvestReady Wealth II.
If you’re investing less than $12,000 a year, iFAST will perform better for the first 15 years only.
Conclusion
Hopefully, with the extra information on iFAST, I hope that you’re clearer in deciding if iFAST is for you. As with all investment options, there are pros and cons to each and every decision.
If you are looking for personal advice please seek a qualified financial advisor.
iFAST can work for those in Singapore if they are looking to invest with an advisor then this is an option, as always, there can be more options open to you. This option can work for those who spend a lot of their time working and want to be able to put money to work outside of their day job.
If you have any questions about investing while you are in Singapore or you want to ask some questions regarding iFAST then please email me at info@investmentsforexpats.com
