How Parkes RSL sub-Branch is increasing its return on investment

The Parkes RSL sub-Branch has recently changed the way it invests sub-Branch funds, aiming to increase the return so that it can better support local veterans and their families.

As a member-based organisation, RSL NSW values the autonomy of sub-Branches in their financial decision making and asset management.

As part of the Strategic Plan 2021-26, RSL NSW has launched a new funding model to encourage increased financial autonomy at a sub-Branch level. A major component of this initiative is an Aggregated Investment Management Model. The investment scheme, made possible by investment management company Morgan Stanley, provides sub-Branches with the opportunity to invest their funds to support their financial future.

The Parkes RSL sub-Branch, looking to capitalise upon the opportunity to bolster its finances, recently invested $100,000 via the initiative and sees a brighter future because of it.

We caught up with Paul Thomas, Treasurer and Secretary of the Parkes RSL sub-Branch, for a Q&A about why the sub-Branch decided to make the investment, what impact he sees it having, and his advice for other sub-Branches looking to change their investment strategy.

Q: Why has the sub-Branch decided to make this investment, and how does it work?

Interest rates are hovering at around the 1.5 to 3 per cent mark at the moment, and a lot of sub-Branches have been finding it difficult to invest money at reasonable rates. Sub-Branches are looking for larger investment percentages than what they would get at the banks.

Our investment account is controlled by three trustees at the Parkes RSL sub-Branch, including myself. We retain complete control over the funds that are entered or withdrawn from the portfolio. At the moment, we’ve put an initial $100,000 in there, but if we wanted to we could invest another $50,000 without needing to compete with other sub-Branches.

Each sub-Branch’s account has its own secure login, which is linked to their bank account. This is another good thing – we don’t have to worry about chasing money; it goes straight into the account.

Any of the sub-Branches in the western districts of New South Wales could team up with another sub-Branch nearby, invest some money and share the profits. We just had to come up with a six-digit figure as a minimum.

Q: What will the investment enable the sub-Branch to achieve?

Most RSL sub-Branches are welfare organisations. The work we do is charity work, which involves looking after the welfare of the ex-service personnel who have served the country over the years. That’s our main aim, and we need money to do it.

But you’re not only looking after the welfare and day-to-day needs of returned service personnel – there are other things like disaster relief too.

Q: Why is it so important for the sub-Branch to invest for the greatest return?

Out here in the bush, we can’t afford to head into the office more than one day a week. We’re only a small sub-Branch, with about 90 members, so we need the money. It’s completely different from metropolitan sub-Branches; they have a bigger audience so they can run events more often.

On the RSL’s two biggest days, ANZAC Day and Remembrance Day, we sell memorabilia and goodies to the general public, but don’t make a great deal of money. We have Friday night raffles at the club, but only pick up a couple of hundred dollars each time. That only amounts to $5,000 or $6,000 a year, which is not a great deal if you need to be fundraising.

What’s the reaction been like from members?

Our members have been 100% behind us since day one. We were probably the first sub-Branch to join up with Morgan Stanley, and we’ve received congratulations from other sub-Branches for making the move, because it assists us in so many ways. I’ve had people ring me to ask how we did it.

We commenced this investment in February this year, and haven’t looked back. Someone had to make the move, and we haven’t regretted it in any way.

Q: What insights would you share with other sub-Branches considering changing their investments?

Sub-Branches need to have a look around at what investment options are available. It’s no use going around blindfolded. Decide whether you need a short- or long-term investment, and it should be your sub-Branch’s decision as to which path you take.

Big investment decisions like this should not be left to trustees like me, because we’re only human. We’re all liable to make mistakes. When you take a proposal back to the sub-Branch for approval, it should all be explained to the members, and the members must approve it.

Making an investment with the Aggregated Investment Management Model is possible for all RSL sub-Branches across NSW. Learn more about the Funding the Future initiative here.