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Sanlam Cumulus Echo RA

Sanlam Cumulus Echo RA

I was recently approached by someone for help with her Sanlam RA’s – they are the bad, old traditional life RA’s with opaque fees, poor returns and hefty penalties if you make any changes before the term ends. It seems that Sanlam has found a way around this though with their Cumulus Echo RA where they are encouraging clients to move. The “carrot” is no penalties when the move to this RA and bonuses if they see...

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Executors fees

Executors fees

Not sure what happened this past weekend but I received 2 emailed questions (from unconnected clients) about executors fees this morning. Seems the discussion has been around the quantum of the fee and how much the traditional executors (banks, trust companies and attorneys) charge.  The maximum fee in law is 3.5%+VAT plus 6% on interest and income earned by the estate during the winding up process, and they have all tended to charge the...

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Std Bank Flexi Advantage Investment Account

Std Bank Flexi Advantage Investment Account

This is another offering from Std Bank that gets a big thumbs down from us. The radio ad sounds promising: • Access up to 40% at any time • Great interest rate of up to 7.4% However, you only get 7.4% on an investment of R5m or more that you are prepared to invest for at least 12 months (you would have to be crazy to do this)! For most of us the interest rate would be closer to 6% pa. And while you can access up to 40% of your...

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To pay a penalty or not?

To pay a penalty or not?

A client of mine presented a potential dilemma to me. He has a living annuity through Liberty Life but also has the bulk of his living annuity funds on a LISP platform. He was wanting to move the Liberty one to the LISP and consolidate his investments on one platform*. Under normal circumstances there should be no penalty when transferring living annuities. However, in the fine print, Liberty had noted that there would be an exit penalty if...

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Is everyone thinking it but no one prepared to say it?

Is everyone thinking it but no one prepared to say it?

What if SA is where Zimbabwe was ±20-25 years ago? With the benefit of hindsight, what would the average Zimbabwean do differently? Would they have stopped investing into their pension funds and bought more foreign currency? Would they have emigrated? Would they have bonded their houses to the hilt and taken the funds offshore? I have always promised my clients that I would not invest their funds where I am not investing myself…if it is...

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Dont panic – plan!

Dont panic – plan!

There are essentially 2 emotions that drive human behaviour when it comes to money: fear and greed. Both of them can result in investors behaving irrationally and this can result is significant financial losses if we are not careful. For many South Africans there is currently a lot of fear around the future – it certainly looks like SA Inc is doomed (well for the next 5-10 years at least) and at times like this it is easy to panic and...

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Gryphon Money Market unit trust – the most accessible money market account out there?

Gryphon Money Market unit trust – the most accessible money market account out there?

Despite all the money that the banks spend advertising their savings products and all the claims to have no fees or commissions, I would not put a cent into any of their money market or savings products. If you want a money market account then you need to use a unit trust money market fund. They are safer, more transparent (cheaper) and give better returns than the bank money market accounts: Safer – the money is held in a trust and...

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