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Does your adviser use a LISP?
This headline might sound like a question about your financial adviser's speech patterns. In the world of investing, however, it's about whether or not your adviser uses an investment platform, also known as a Linked Investment Services Provider or LISP.
Lize Visser, Head of Sales at PSG Wealth
Using an investment platform gives investors access to a wide variety of investments, such as unit trusts from different companies, through one channel. It also gives investors the opportunity to easily switch between different investments, and provides administration benefits to both investors and advisers.
A LISP also gives you and your adviser access to traditional life insurance products such as retirement annuities, preservation funds, living annuities and endowments to cater for the full range of your investment needs.
As a result, most advisers do use a LISP. But which one, and why? Here are some questions to ask your adviser about the platform he or she works with:
There will be a few more considerations when your adviser uses a platform, including the financial stability of the platform and value for money when using that platform.
Keep in mind that by law, if you decide you want to stop using the services of your financial adviser, you can ask the LISP to remove him or her from your account and to stop making any advice fee payments. "But then also remember that you will be on your own, and it is not the LISP's duty to take care of your future needs or objectives - your future investment outcomes will be determined by your own decisions," Visser concludes.
About Lize Visser
Lize Visser is Head of Sales, PSG Wealth