Roundtable: Tax Efficient Vehicles for Wealth Managers

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  • 37 mins 57 secs
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  • 0.5 points

In this roundtable a panel of experts discuss different tax efficient vehicles, endowment product rules and the limits around retirement annuities. Discussing are:

  • Andrew Auld, Executive Wealth Manager, Alexander Forbes
  • Tiaan Herselman, Head of Advice, Old Mutual Wealth
  • Lisa Kaplan, Wealth Manager, Sterling Private Wealth



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Welcome to asset TVs retirement income roundtable on tax efficient vehicles for wealth managers with me, Joanne Bone. Um, Today I'm joined by Tian Haselman, head of advice, old mutual wealth Andrew, old executive wealth manager, alexander Forbes and lisa Kaplan wealth manager sterling private wealth. Welcome everyone. I do feel a bit today. Like we're gonna give away all your trade secrets as to how to run really efficient portfolios for clients. But be that as it may, I think we have to dig in and really get involved. Tian, I'm gonna start with you. What are the different tax efficient vehicles that one can use when looking at client's retirement income? Good morning, john it's still morning on the side. I think there's, there's quite a few, I think the ones we normally speak to our general, it's either retirement annuity or people decide between that and a unit trust or an endowment. We've obviously seen the tax free savings account also come up as a blade, but it might not always be applicable to all investors. So I think the general option normally is deciding between a retirement annuity, a unit trust and an endowment. I think that's the option that most people look at when considering retirement income, especially in a country where less than 6% of people can actually afford to sustain their post retirement income needs once they get to retirement. But I think it's financial planners as financial managers or wealth managers. Sorry, those are jenny, the three vehicles we normally look at for clients and they all have their pros and cons. And I think we might all have different views on what's more applicable, what's more appropriate. But I think it really varies for each client. There's personal circumstances. And I think there's also some general views we might have on these vehicles that we could challenge from time to time based on each client's set of needs. Okay. Andrew the word endowment is. It's just a huge word. What does actually mean? How does it work? Yeah, I guess this is one of those things, what's in a name? You know, I mean, I think that, I guess ironically the word is misleading because we hear the word an endowment often spoken on american tv when it comes to big universities. But really it's a, it's an investment structure that has a specific tax consequence to it. So it's a savings policy. Yes, that's maybe the easiest way to say. It's a way to save inside of a structure that's regulated. And I think, I'm sure in, in our chat today between Tionne lisa, you and I, we're gonna unpack for the folks listening, you know, just those, those aspects of the tax and the regulatory and the other environment relating to endowments. But essentially it's a way to save through a life insurance structure that is regulated. Okay, so lisa Andrew mentioned the tax efficiency around it and that's what kind of what we're talking about today. How does the tax in endowment structures work? Morning, Joanne? Um, so essentially, your contributions within your endowment structure, taxes triggered upon drawing or switching. Um, and the way that that is taxed is your income tax effectively is capped at 30%. And if you apply an inclusion rate on capital gains of 40% to that, you get an effective C. G. T rate of 12%. Um, so essentially any taxpayer with a taxable income In excess of 30% to 30% marginal rate. Uh, that would be an a tax efficient saving structure for them City. And I see you nodding along here, would you choose, would you put clients into this whose marginal tax rate is above 30%? So I agree with uh, with Lisa on that statement, I think maybe just the other thing I would also look at is what is the effective tax rate, you know? So if you look at the total taxable income, we might have clients that maybe four and a 41% marginal tax rate. I think it's a good starting point to look at 30%. As you know, if my client is in a In the marginal tax rate of more than 30% and that is a good time to consider the endowment. But maybe also just look at the effective tax rate as well. And I think especially for people post retirement, I think we see a lot of retirees once they get to post retirement incomes aren't the same as what they normally are before retirement. We see a big drop of people either retiring or the disposing of businesses. So I think we need to look at also long term for endowments, apart from the marginal tax rate, which I completely agree with this, I think we should also look at the effective tax rate, but also what happens in retirement. Um If I'm a client earning 100,000 rand per month, I get to the point of retirement. Now, I'm only drawing from my retirement capital, that's total gross income depending on where my assets are, diversified. How much I've got a retirement funds are between discretionary capital. That has a big impact on the marginal tax rate and the effective average tax rate. So I think just almost add on to Teresa's 0.30% is a good starting point. But I would also also look at what is the situation looks like post retirement, especially if we're sitting at these endowment vehicles for people that maybe are not get at retirement, they've got a longer term, but once they're in that, what is the consequences once they also get to retirement? Okay, so Andrew, we've looked at the sort of tax rates aspect to endowments, but there are quite a lot of rules that govern endowment products. Just can you briefly explain to me how they work? Maybe before I even go there and I think perhaps a sort of a tip for all of us, what I like to do with these types of discussions and make them as practical as possible, as early as possible, otherwise we tend to lose one another. So what I think is quite important and Tian's hit the nail on the head there, you've got to actually be earning more than 467 and a half 1000 rand a year in taxable income. So I repeat that number, 467 and a half 1000 rand, you can get your car trailers out to work out what that is monthly. Um, but it is well above, well above the average earnings of a South African investor. So for your higher income earners, this certainly is a product that one needs to look at. But I can just off the bat say that it's probably not appropriate for most South Africans. So the endowment is probably not appropriate for most investors that earned. So if you're earning under 467 and a half 1000 taxable income, that means after the after deductions you're, the tax you would pay Is going to be 31% or less. So you're at 31% of you in that window. So in essence, there is very little reward. Um in fact, if you're earning less, you are punished if you are investing in an endowment for two reasons. One is because you're paying 30% instead of whatever your rate is, you could be paying 26%. If you're earning 2, 300,000 a year, you could be paying something in the order of 26 as opposed to 31. So if you are not earning more than that, you should probably walk away from the concept of an endowment. Um So I think it's important just to sketch those parameters first up. So it's it not only is probably not, I say, probably because, you know, th representing old Mutual can help us here in that what companies, what the big insurers have done over the years that they've made it easier for parents to save for their Children's education. We've got a really good culture in South africa of education savings and one of the things that you can do with an endowment because it's a life product, you can add nuances to it, like a waiver of premium. So for a lot of folks who are concerned that they might become disabled and not be able to continue to save towards their Children's education, the big insurers have package these endowment structures in such a way that you can add something like a waiver of premium. So for the lower income, the lower income earner, he may well be he or she may well be sensitive about the concept of possibly becoming disabled. Again, it's probable and I don't want to ankle tap Tian's marketing department, but it's probable that they're going to pay a little bit of a premium and that's just the way of the world. If you want something that's practical, practical and workable, don't get too critical if it's slightly more costly um for the smaller type premium than what you would like. It is what it is. That's that's just the economies of it. I just want to stick to retirement income here at the moment as opposed to educational policies with different bills and whistles. So t and I'm gonna throw the question back to you And I appreciate that endowments are probably not for people earning less than I mean more less than 267,000. I think the number you quoted us, but Tian when that client walks in with more than 467,000 and you put them into endowment rapper. What are the pros and cons that we should be aware of? I think the first thing is we have to keep in mind that endowments do have certain constraints. Pros and cons. But one of the Ortho back is liquidity. So there is a five year restriction term on any endowment whereby you can't withdraw, you can make one withdrawal in one loan and that can't be more than than the initial amount invested plus 5% compound interest. So it's 105%. Also your contributions to the endowment in any one year can't be more than the total contributions for the previous two years. What can people more than 20% of the contributions for the first two years? So if liquidity is a concern, the endowment probably isn't the root for you. There is a massive and to to Andrew's point at this point, there is a massive benefit for especially high-income tax owners in our country to have the endowment for those benefits. But if liquidity is your main concern while you're still alive, then the Endowment probably isn't the vehicle for you, but it does have good benefits, especially when you pass away. So one thing we always, we always talk about is there is an executive for saving the Endowment, and that could be anywhere from 4% plus back, depending on how much your executive charges. But also it does give yourself and the beneficiary, the option that if you pass away the money is not tied up in the estate because you actually have a life or beneficiary nominated. So they can then choose to either take the proceeds or they can take over the ownership of the investment itself, which then wouldn't trigger a capital gains tax event. So apart from the tax benefits, we just have to be aware that there are some liquidity constraints for retirement. And again, I want to help on the point that I think we look at these vehicles for certain clients. We shouldn't just take the view of what my income is now, pre retirement. We should also have a long term view. Just look at what is the income post retirement and how might that impact my my picture. And you may have made a good point earlier and that most clients in S. A probably wouldn't fit into these vehicles. I mean, a recent study done by the Africa wealth report, I mentioned that we have 36,000 clients in the country Or 36,500 South Africans that have net assets, these are investments, properties of more than $1 million us, that's 15 million. Now that's only 36,500, there's almost more financial planners than that in the country currently. So I think it is appropriate that we take the pros and cons into account which the one is tax. But you need to be aware of the limitations in my view upon liquidity is a big need, especially weapons on covert. Now that is something you might be want to be made aware of of endowments. And the other thing I also just like to make clients aware of is that these investments are not tax free. I've heard a lot of financial planners or financial advisers even in the media say that endowments are tax free just because you don't pay the tax in your hands. It's paid by the insurance company doesn't mean they aren't any tax implications on these vehicles. Okay, lisa, I saw you put your hand up if you want to say something. Yeah. So I thought I'd actually just add on to what Tian had to say, one of the biggest benefits that we hear from our clients is actually the fact that the tax administration is taken care of on your behalf by the life insurance company, all the relevant investment platform. Um the fact that they are both calculating and paying the tax on your behalf really does eat huge administrative burden for some clients. So that is a major benefit. Um And then besides for the kind of liquidity constraints and the tax benefits for the right type of client estate planning. We, from my perspective and the type of client that I'm dealing with is also one of the biggest benefits, just the ease of passing down that asset to your beneficiaries on your death um That quick access to capital, it's not wound up in your estate but you have to have a beneficiary appointed in order for that to happen. Um, So that is quite meaningful. Okay. Andrew just back to Endowment products before we move on to other assets, class or other tax efficient vehicles. The liquidity has been mentioned as one of the cons. Do you think that's a massive con in this, in this product or can people borrow against it or withdraw? Maybe just explain to us in your name and stadiums again, how these products work In order to get the benefit of this, let's call it soft tax. There's a massive arbitrage is a big gap between 45% tax, which is our maximum rate and 30%. So there's a huge opportunity. Um, and similarly, our clients really enjoy the fact that taxes captured 30 as opposed to them paying 45% in order to get to take advantage of that to take advantage of the state, um uh executive fee savings, the state administrative savings, and just the convenience around the whole tax in order to do that. The rules of the game are that you may not withdraw More than one time. So you cannot have multiple withdrawals of money inside the 1st 60 months, inside the first five years or within what they call a restriction period. So effectively you can't treat this as a savings account at the bank or a unit trust where you can just every other year decided you're gonna make a withdrawal. That requires strategic planning up front to say, look if I want to take advantage of this tax and other benefits in the structure and then I need to plan ahead and I need to know that I have foreseeable expenses covered. If surprises come away as they often do, there are ways around this. I mean, you can, you can, you can create multiple structures so you can have, you can set up as many endowment structures parallel to one another as you would like. So for instance, you could simply, you can take out five in diamond structures if you want to do and then every year you could withdraw some or all of of one of them. So really the liquidity issue is very solvable, but it does require awareness upfront. In addition, J and you mentioned loans, um some of the administrators have been clever enough to set up structures whereby you can effectively borrow against your money instead of withdrawing it so that you have liquidity. You can use the money for the emergency. And then of course you can repay the loan without doing what they call triggering uh, over and over investment because not to get too complicated, but one of the ways you trigger a restriction period, the first five years is a restriction period. But in any other point, You can trigger a restriction period by putting more money into the structure than the rules allow. And the rules allow that you may not invest more um than 100 and 20% of what you put in in the previous two years. So for the hire of any of the previous two years. So if you trigger this restriction period, you then face the reality that you cannot draw more than once. But as I say, if you take a loan, you can repay the loan. Um, and there's some clever structuring around that that make the liquidity issue not such a big deal. I think the biggest issue with the liquidity is if you are unaware of it or if it's not fought through at the investment point. So, I personally have, I've hardly ever, in in over 20 years of helping helping clients. I've really never had huge problems with this liquidity issue because we go into it with their eyes open and we structure it appropriately. Okay, so Tian, we've discussed liquidity issues around endowment products. Let's just delve into beneficiaries in a little bit more detail. Can companies and trusts be beneficiaries of an endowment product? Yes. You can nominate various beneficiaries on an endowment. It can be company, it can be a natural person, uh, can be a trust. The one thing just to take into account is once the money or the beneficiary or the person that passes away as the life is, sure whether they get the money, they take over the ownership of the, of the product or whether they take on proceeds because that could trigger a capital gains tax event for either one of those two. Okay, so if it's a beneficiary proceeds, would that be a CVT event? Is that what you're saying? If they taking the proceeds, they choose to disinvest the capital and they take on the proceeds, then that would be a triggered capital gains tax event. Where if they take over the policy itself, they take over ownership of the policy, then there's no capital gains tax have been triggered because they're only taking over the ownership of the policy itself. So Lisa We've discussed endowments and quite a lot of detail and back to Andrew's point that endowments are probably there for high net worth individuals or certainly somewhat earning over 467,000 round a year. So the other tax efficient vehicle that's well known in the marketplace is retirement annuities. When would you put a client into retirement annuity as opposed to just putting them to unit trusts? What decisions make, what do you think about? We're making those decisions. So I mean, it depends a lot on the specific client situation, how old they are, how much they're earning, what their preferences are, that type of thing. It also doesn't need to necessarily be one or the other. You can determine a certain portion of savings that should be going to a retirement annuity and another portion that should be going to a unit trust or a tax free savings account or all three. Um, so it really is specific client to client. Um, something to take into account with a retirement annuity is that you do get a tax deduction for all of your contributions and all of the growth in that product In that vehicle is tax free. So it is a very tax efficient way to save. But you can only access those funds when you turn 55 and you can only access 1/3 is a lump sum and the balance has to be taken as an annuity. And throughout that Investment period, you also restricted by Regulation 28, Which the biggest restriction in regulation 28 is the limits of having 30% off shore, so you can still have another 10% in Africa. But what most South African investors are after is more than an allocation of 30% off shore. And that also Is very much based on personal preference. Um, some investors want at least 50% of their savings to go offshore, and others really need that deduction to assist the overall net capacity. So it really differs investor to investor for investors that don't want something as e liquid as a retirement annuity, but don't also fit the profile of an endowment. A tax free savings account really is a great vehicle. Um, if you can save your 3000 rand a month or your 36,000 rand a year, you have a 500,000 rand lifetime cap, you can have 100% social allocation and your tax free savings account if that's what you wanted to achieve. And with that type of vehicle, as with a lot of these tax efficient vehicles, because you're effectively saving on capital gains tax, that benefit is greater to you the longer your investment horizon. So these things are always the most advantageous to most people, the longer they're held for. And specifically with tax free savings account, for example, I would for some clients that can be your component where you are saving aggressively offshore, for example, using a debit order, which you, you can't actually save or directly offshore in dollars or in another major currency using a debit order, you actually have to apply for your allowance. Um, so the tax free savings account would be the first point of call for capacity, the first leg of capacity and they're after, you know, trust or an endowment. So usually it's, it really is a blend of a number of vehicles. Andrew you say you've been in the store for over 20 years. And one of the things that have been coming out a lot in the press last year, but not so much this year, interesting enough has been prescribed assets. Have you seen clients saying to you, I don't want to put money into retirement annuities. I'm scared of what the government will do with my money. It's definitely a conversation that everyone's having. Um, as always, it's very difficult to be able to tell the future. So it's a, it's a tough one, you know, so you've got to weigh up the obvious benefits from a tax point of view are boosting your retirement savings through to getting a tax deduction on putting money in the retirement annuity structures. But they're very definitely are people that have expressed concern around being forced into underperforming investment assets in terms of a possible future prescribed assets, legislative environment. Um, and it just again, not to get political, but it does speak to the, to the need for clarity around that. You know, it really does chase investors away when they have a lack of clarity. And, you know, what, why take additional risk? There's plenty of risk around to get rewarded for why, why seek out political risk? So, it is a, it is an issue. Um, I think having said that, that most of our, most of our clients um have developed the ability to rather react or anticipate when, when uh legislative changes are more concrete. And so, you know, it's still a little bit too vague to really commit to not taking advantage of something is as useful as a retirement annuity. I could also say that the the modern retirement annuities or you know, I can just put on record as saying, I like them. I think they're great. Uh There's a school of thought out there amongst the older folk that retirement annuities are really not a great form of investment and people misconstrue the fact that an R. Is merely the structure around the underlying investment. So I endorse support, I use them. I think they're great. Um one should never consider retirement annuity when I say never, never say never. But you shouldn't be thinking about a retirement new to unless you have taxable income. There are folks who don't have taxable income and it's utterly pointless uh saving into an R. A. If you don't have taxable income. Um If you're a businessman, you're scared of creditors and wish to have credit credit protection. Um one would assume you've got taxable income. So, you know, I think the one goes with the other. So yeah, but on the on the prescribed acid story, it is a concern. Uh And I really hope that the powers that be from an essay point of view, work with us on that and help build a culture of savings and retirement annuity is a wonderful way to do that lisa you wanted to say something. So just to add on to what Andrew said about the benefits of retirement annuities is that it also falls out of your estate when you pass away. So your beneficiaries can inherit an asset that retains its full value unless you are withdrawing it. So you have that optionality. But your beneficiaries are investing in asset that's retained its full value and they can link an annuity income to that and it also has there not wound up in your state and that kind of drawn out process. Okay, So there's massive benefits while you're earning taxable income and they clearly benefits when you die because it leaves your estate. Tian just gonna get back to basics for a second. What are the rules around retirement annuities? How much can you invest? Can you just go through the just the practical applications of this? So first of all, there are certain limits. You can invest whatever mind you want. However, there's only so much you can have the tax reduction in any particular year and that is the higher of 27.5% of remuneration or it's a cap of 3 50,000 rand per year. Now the benefit is if you do go over that limit, you have one or two options, you can either take that amount come into the next year as part of your tax reduction or once you get to retirement, the income you draw from the living annuity structure. Because once you mature retirement newt, you either have a life annuity or living annuity after whatever you've taken as a communication, that income is tax free up to the point where you get to the disallowed contributions or apart from that. Um yeah, that income is tax free at retirement secondly to to follow up on from from lisa, I just wanted to touch on that. I think retirement annuities are massively beneficial, pretty retirement, and once clients are still saving for retirement, I just think we have to look at the tax efficiency again, once you get into retirement, because I do think every single rand you draw from the retirement annuity is fully tax, it's beer wine, I think it's sometimes people don't always take into account that tax the tax bill, you get what you are in retirement, especially if you're a high-income earner, if you're drawing 50,000 and from a living in the city of 50,000 unit trust, there could be a big difference between those two amount. So t I just I understand it. Are you saying when someone retires from retirement annuity, they should withdraw all their money, pay the tax on it, and then put that into a endowment or unit trust structure? Is that what you're saying that possibly what you're saying is put a portion into a living annuity and a portion into other assets. Just explain that in more detail, please. Yeah, I think it's a, it's a balancing actually, there's no right or wrong on. So I think most people will most likely take the 500,000 tax free, but I think the balance of the capital you take as a lump sum depends on your liquidity constraints in retirement. So did you have big vehicle purchases? Do you have big capital outflows and retirement? But then there's also this tax, uh, tax trade off. So if I put all the money into the living in your 18, well the tax inefficiency of that cause me to draw more capital than I would have drawn in the unit trust as a, as an example or the endowment. So you have to weigh off the percentage of tax you pay once or as a speeding fine to SARS when you take a long time. But retirement versus the continuous speeding fine, you're gonna pay on the living annuity income and that's gonna be different for every client. So what I would look at is what is the income needs? I have to fund, How much do I need after tax, but also what are the capital needs I need in retirement. And do I want to tie up all of my money in a retirement structure where I'm limited to 2.5 to 17.5% what do I want to make sure I take enough capital as a lump sum and then you can invest it either in a endowment or you know, trust investment. So I do have this backstop especially, but we still with Covid is a lot of people needed to have a bit of a backstop for unplanned expenses. And that's especially true in retirement. So I don't think it's a right or wrong answer to say look like the 41 3rd or take 100% if that's possible. I think it's a balancing act and for me the two triggers are about tax, especially time out. But also do I have enough access to liquid capital for future big pocket items that I might want to plan for in retirement. And this can be holidays, vehicle purchases potentially even moving into a frail care facility. Do I have the capital to do that? Because in the retirement structure in this case the living annuity, I can only set that income once a year. I can change the frequency of that, but I can only draw between 2.5% and 17.5% where in the liquid capital again it speaks to liquidity and I just think post retirement it is a time where you'd rather want to be liquid than be illiquid. You wanna have some flexibility but also be tax efficient at the same time. So I think it's not just the case of saying take everything out. I think it's different for each individual investor based on their circumstances and hopefully the cashflow, what you would have done for that particular client Andrew. Do you have any comments on that? Is that the similar advice that you give your clients? So we still, we still have a number of clients that use use the vehicles post retirement. So we obviously uh, are a a retirement annuity user is obviously a pre retirement vehicle. This baby, a point in a planning point is always quite nice too. Um If you if you retire and then you're going to consult but you'd like to supplement your income, it's quite nice to have a retirement duty to retire from set up a cash flow to supplement your consulting income, you know, before retiring from your larger other funds because you don't need the cash flow. So you know, there's a so I I failed to see how any self respecting South African investors should retire without a retirement annuity. I think we should all have them and I challenge anyone to get hold of me and explain why I'm wrong. You know, in the press, you would love to argue with you on that one. Why I say that is because You know, if you if you're over 65 you've got the ability to earn, you know, if you take medical tax credits into account, you've got the ability to learn something like 15,000 month tax free. You know why on earth wouldn't you take advantage of a tax deductible savings strategy in order to build up a couple of million rand in a retirement community. So that when you stop working one day you've got 15,000 rand adamant that you can earn tax tax free literally you know the tax scales when you're 65 or are quite friendly. You know you can definitely it's a it's a livable wages, a pensioner. You know, I think the south african pensioners are not Badly treated from a tax point of view. So there's a very very strong case for for that. I mean, you know, one obviously would would want to marry and you've you've rightly pointed out J. And about things like prescribed assets Lisa's touched on the limits of 30% off shore. But you know, um there's seasons for everything and who knows maybe the J. C. Will will again rank first or second in the world is from a performance point of view. So you know I never say never lisa. You wanted to say something. So I mean just to touch on actually what both Andrew and Tian said so I mean Andrew is very much in the camp that retirement strategies are incredibly useful and I agree with that. Um Tian touched on the importance of balancing that out. And I'd say that's very much where I'm aligned especially for high net worth individuals that are drawing large incomes from their portfolios. Having both that annuity income coming from a compulsory savings vehicle being your pension where you're living annuity. As well as having a discretionary savings pot where you are supplementing your income through just drawing down from another portfolio where either you're paying interest income in your cash pot or you are paying capital gains tax every time you repurchase those units. But just supplementing your total income that you require from both. That compulsory savings pool and that discretionary savings pool can reduce the overall tax that you're paying. So it can be a more kind of optimized outcome in terms of making capital last. Yeah. Yeah. I think I want to support what both Andrew and and lisa said I see. Andrews a big supporter of the retirement annuity and I completely agree with them. I wanted to and I really like what Andrew did earlier on with the endowment topic, you know, putting a number to it. So um I always like looking in to listen to your point about maybe a dollar millionaire which is, There's currently in our country 38,000 of these guys. But if you look at somebody that has 15 million at retirement, okay. Just to put some numbers to it, and it's assumed that all of us in a living and equity investment at a 5% drawdown. It's roughly 62,000, um 62 500. Their net income is about 46,000 on that. So their average tax rate in retirement on income is 25%. If you made one change, and you assume that half of that money is and, you know, trust structure, and it's assumed that that was saved prior to retirement and they weren't taking a lump sum that was accumulated over over a long period of time. Let's assume that they had the same amount of capital 7.57 point five. Now, again, you can make the argument that you would have more money in the, in the area because of the tax benefits. But just for the example, if I put 7.5, you know, trust, 7.5 living annuity. And again, I assume I draw 5% and I made two assumptions for tax one that there's 2% Tax on the interest or the total interest holding unit trust is 2%. And I assume that 50% of all the capital drawn is a is a capital gain on the, you know, trust, I still get to a net income of 52,000, which is more than the first scenario of 46. Now, that's an average tax rate, roughly on income of 15.5%. So I see almost a nine or 9 to 10% drop in tax in retirement if I don't go one step further. And I say, well, if all of the money was in a unit trust structure And I make the exact same assumptions, I'm drawing 5% and I assume that all of it or 50% as a capital game from the unit trust and there's 2% of the portfolio is is interest. So I take that into account as well. My net income is 57 now my tax bill is only 5000. But my average tax on income, if I look at the income that I'm drawing is about 8.7% Now to get to the same scenario. If I just look at the retirement, that's why I agree with Andrew's point that for for smaller investors, it really makes a lot of sense. But to Lisa's point for high investors, I would have to save approximately a roughly 4.2 million or I'd have to have 4.2 million more in my retirement funds to make up that gap. So I have to have 19.2 million versus 15 million in the unit trust to get to the same um, to get to the same net income for that particular client. So the are really does make sense, but you have to have sufficient, more or more sufficient growth leading up to retirement to get to that same outcome. You're forgetting the fact that behind Kamina, They gave the 45% tax savings in your numbers so that so you know, without trying to I mean, I think the reality is listening to all three of you. Okay, there are a number of tax efficient vehicles out there. And then the overriding issue is, are you high net income earner or not back to? Andrew's point the very beginning, I think it has a lot to do with how much money you earn as to which vehicles going to suit you Because clearly if you're not paying 45% tax rates, an environment of 30 doesn't make a lot of sense for you for a lot of clients. I think what's also very obvious from training to all three of you today is my gosh, if you're a client out there, you need a wealth manager because it's not simple. There's not one answer for everyone and you all very eloquently argue why very different products work work at different times. So if nothing else, I'm very pleased that wealth managers are out there to help clients on this journey towards retirement. Yeah, last word. Tian Yeah, I just want to want to echo that. I think the one point I'm going to end up with is you can't do this, so I'm not a financial planner, but you couldn't do it without the leases in the end of the world. So I think if you have any money and you get into retirement or building up the biggest thing you can do in your financial plan is go speak to professional. I just think there are so many complexities even today. Are we? I think we agreed on most, but there may be some small disagreements, but go speak to at least go speak to Andrew because you can't govern this on your own. And that's the closing comment I'd like to make. And that's the last word for me as well. Thanks very much everyone. And I've learned an awful lot today about different tax efficient vehicles and clearly it's a lot to know. Thank you very much.

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