Investments, Technology

OpenInvest partners with low-cost advice firm

Life Sherpa

Two financial firms have partnered to launch a managed fund for investors seeking an affordable investment opportunity.

Digital investment platform OpenInvest has partnered with financial advice provider Life Sherpa to launch a managed investment portfolio solution tailored specifically for individuals with lower account balances.

The offering includes four diversified portfolios with various risk and return profiles, requiring a minimum investment of $5000 and featuring a 0.65 per cent management fee for each portfolio.

Life Sherpa chief executive and founder Vince Scully said the fund is geared towards offering an affordable investment option to a broader range of Australians, aligning with the company’s dedication to accessible financial advice.

“Our model, which is focused on providing advice to salaried employees who may not be able to afford traditional advice, can deliver better outcomes if we can get those members into investment portfolios earlier that enables them to continue to build wealth towards their future goals,” Scully said.

To that end, he noted recent changes in the financial advice sector primarily emphasised improving the quality of advice rather than expanding access and suggested digital solutions could play a role in addressing this shortfall.

“There is a significant portion of the population – who have good jobs, stable income and clear goals – who are unable to afford full financial advice. The successful deployment of technology into advice can bridge this gap and create the future customers of full financial advice.

“We’re talking about people who are clear on what their goals are and they know broadly what they need to do to achieve them.

“What they need is some guidance along the way around particular decisions, but they are happy to learn and use the tools available to help them make good decisions. The online availability of our managed portfolios will enable our members to participate in building their wealth through lower-cost investment options.”

OpenInvest head of distribution Ravi Verma echoed these views and explained as financial advice regulations evolve and the number of advisers in the profession decreases, there may be a need to explore alternative approaches to meeting the demand for affordable advice.

“The rules around personal advice and the loss of advisers across the industry mean that advice firms that want to reach and help the broadest possible audience can’t do so the traditional way and need to leverage innovative technology,” Verma said.

“We’re proud to be playing our role in helping firms like Life Sherpa to provide their professional expertise to more Australians.”

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