CEO editorial – Quarter 4 2024

Gary Mockler
Group Chief Executive Officer

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Several interactions with GTC clients over the past few months prompts me to write this.  By now you’ll be familiar with my requirement that every article posted in the Trendline should meet the definition of ‘advice’.  Any reader of any article should walk away from this exercise with at least a reminder as to how to go about some aspect of their financial planning.

Two of the examples of client engagements that I have recently been through, emanate from clients questioning whether they have received accurate and professional advice.  I write this not in defense, but rather in the realisation that instances such as this will occur again in the future.

In the first instance, a long-standing client with a long-standing relationship with the GTC team had a living annuity that nominated his wife as the beneficiary.  As matters unfolded this client passed away on the Friday and his wife – the beneficiary of his living annuity – passed away on the Sunday.  The question asked by the adult children of this couple was whether GTC should have anticipated this event and somehow formulated a living annuity contract for the mom, whereby she appointed her own beneficiaries. 

The reality of the matter was that the annuity passed from the husband to the wife on his death, and this was excluded from his estate.  The wife never completed a new living annuity application, and her death resulted in the proceeds being taxed in her estate whereas the proceeds would have passed onto beneficiaries without tax if this application process and beneficiary appointment had been in place.

The outcome is of course unfortunate.  Estate duty has been applied whereas living annuities avoid this tax if a beneficiary is nominated.  In this particular instance, GTC’s legal advisors are satisfied that this outcome was not of GTC’s making.  Whilst this is gratifying from a company perspective, it is still tragically sad that this panned out the way it did.

The message that I want to get across is that testamentary planning, and indeed all financial planning is not something that should be completely outsourced.  Every individual who has constructed a financial plan needs to take ownership and ultimate responsibility for this, regardless as to how complex – or not – the undertaking is. 

Family members, particularly beneficiaries, also need to take ownership and responsibility for these undertakings, particularly when an investor falls sick, is diagnosed with a potentially terminal condition, or is in the latter stages of the inevitable life cycle.

The second client matter that is relevant to us all was that of an investor who was seeking a second withdrawal of their retirement fund in order to fund a child’s continued education.  Notwithstanding that each record of advice for this investor (and there were several) noted and reinforced the regulatory constraints preventing a second withdrawal, this particular client continued to be frustrated with their inability to access these monies.

Again, I am satisfied that GTC fulfilled its legal and professional obligations, but that is not really the crux of the matter.  Reviewing this case I was once again reminded that the ultimate obligations and responsibilities, notwithstanding regulatory and common law requirements, must vest with the individual who undertook the original financial planning.

GTC does have obligations to provide innovative advice that is fair, affordable, and practical.  In order to be competitive in a crowded marketplace, GTC must go above and beyond peers and competitors in the compilation and setup of our advice.  It however is always the ultimate responsibility of the person whose money it is, to ensure that they understand what they are undertaking and to be the ultimate decision maker in this regard.

GTC wins EBnet Evolutionary Award

In November 2024 GTC won the 2024 EBnet Evolutionary Award for “Evolutions in Improving Member Outcomes” at their annual technology conference in November 2024.  EBnet is an independent digital knowledge portal serving the retirement industry covering traditional institutional pensions, healthcare, and personal financial planning.

EBnet awarded GTC this accolade based on the voting of delegates at their annual technology conference (with over 1 500 attendees). EBnet’s criteria for the votes were based on innovation, ideas, processes and/or technologies that have led to better outcomes for financial industry stakeholders.  GTC participated in a highly competitive group which included many financial service industry leaders.  

GTC, in its capacity as South Africa’s sixth-largest commercial umbrella retirement fund administrator, won the award for the creation of Altertude – an automated, exponential member-engagement portal.  This digital platform capable of processing some 100 000 members concurrently, offers automated financial data integration with various specific interfaces such as the detailed Pre-advice Life Report (combining some 14 personalised financial metrics into a singular consolidated view), together with TrueNorth – an actuarially driven, automated, financial advisory interface, together with the payroll integrator interface consolidating disparate data bases.  GTC’s core retirement fund administration capability too, is an integral component of Altertude.

David Weil, CEO of Ebnet noted ‘The independent and arms-length EBnet award recognises GTC’s achievements in improving retirement outcomes with innovative, client-focused solutions. Well done to them’.

We are incredibly proud of this achievement and our dedicated team, whose innovation and commitment continue to drive meaningful impact in the financial services industry.