Sign up for updates

Investor Education > Wrap Accounts > Costs of a wrap account

HOW MUCH DO WRAP ACCOUNTS COST?

When applying for a wrap account, investors should keep in mind that there are several categories of fees which might be charged:

Fee What it's for
Account administration fees Wrap account administration fees are charged by the platform operator. Most platforms charge on a tiered basis with administration fees declining as account balances increase. Others charge administration fees on a per investment basis.

Consider badged versions of the main wrap providers as the fee structure is often determined by the selling organisation. For example, Personal Choice eWRAP is a badged version of the Asgard eWRAP but with lower administration fees.
Investment management fees The underlying funds you choose will have management fees which are charged in addition to the wrap account administration fees (if investing in shares no investment management fees will apply). These are typically wholesale fees which are about half of the price of their retail fund equivalent.

Wrap platforms will use their market share to negotiate fee rebates from fund managers and some will pass these rebates back to the investor.
Transaction fees Some platforms might charge transaction fees for buying and selling investments. Investors can also incur additional fees such as the buy sell spread. Share trading also incurs a brokerage fee either from the default platform broker or the investor’s chosen broker from an available panel of brokers.
Establishment/entry fees Entry fees up to a maximum of 5% are paid to your adviser as an upfront commission. Entry fees are optional on wrap accounts you can access directly. 2020 DIRECTINVEST offers wrap accounts with no entry fees.
Adviser service fees Most wrap accounts do not charge a fee for switching so financial advisers commonly charge a percentage based adviser service fees ranging between 1-2% pa. Adviser service fees are in addition to other platform fees.


Are you wrapped up in fees? Until recently, investors could only access wrap platforms through a financial adviser and as a result incurred the often unnecessary fees such as sales commissions and exorbitant annual adviser service fees. Ongoing adviser service fees of 1% - 2% pa of the account balance undermined the cost effectiveness of wrap accounts. By accessing a wrap account directly, you can bypass entry fees by paying a financial planner on a fee for service basis when required and execute your investment decisions yourself. 2020 DIRECTINVEST offers direct access wrap accounts with no entry fees and no adviser service fees. 

 

Portfolio administration solutions - wrap accounts

 

Investments

Australian shares
International shares
Property
Fixed income
Cash

 

Investment products

Managed Funds
Managed Accounts
Superannuation Funds
Wrap Accounts
Insurance Bonds

Strategies

St George Margin Lending
BT Margin Lending
Investment Bond
Sophisticated Investor Opportunities
Self Managed Super Funds

Fund managers

Colonial First State
Perpetual Wealthfocus
BT Investment Funds
MLC Masterkey
Spectrum Super

Australian Fund Managers

Investor Education

Managed investments
Superannuation
Separately managed accounts
Wrap accounts

PRIVACY POLICY  |  TERMS & CONDITIONS SITEMAP

© 2020 DIRECTINVEST 2016   |  A member of Mason Stevens Group |  ABN 89 069 774 456 

Corporate Authorised Representative AR No 336649  | Financial Services Guide