
<p>By <a href="https://www.cnbc.com/karen-gilchrist/">Karen Gilchrist</a> </p>



<p>Making your first investment can feel like a daunting prospect.</p>



<p>Memories of the global financial crisis — and subsequent market dips — hang heavy for savers, particularly those who came of age during the 2008 downturn.</p>



<p>Multiple studies point to millennials’ and Gen Z’s skepticism toward investing:&nbsp;<a href="http://www.cnbc.com/2018/08/01/why-millennials-are-scared-of-the-stock-market.html">One Bankrate report</a>&nbsp;found that just 23% of those between 18 and 37 years of age saw the stock market as the best long-term money store. That’s compared to 33% of Gen X (those between 38 and 52 years old) and 38% of baby boomers (people between 54 and 74 years old).</p>



<p>But with low, and in some places negative, interest rates continuing to suppress cash savings globally, sitting on the sidelines could do more harm than good.</p>



<p>Analysts suspect that the savings shortfall could have major implications for long-term financial goals.&nbsp;<a href="https://www.cnbc.com/2019/12/17/standard-chartered-majority-of-savers-set-to-miss-retirement-goals.html">A recent study from Standard Chartered</a>, for instance, found the majority of savers in the fastest-growing economies are set to miss their retirement goals by 50%.</p>



<p>The good news, however, is that it’s easier today than ever to invest; new technologies and a host of digital wealth managers have opened up entry into lower-risk investments from anywhere in the world.</p>



<p><a href="https://www.cnbc.com/make-it/">CNBC Make It</a>&nbsp;spoke to some experts to find out their top tips for getting started.</p>



<h2 class="wp-block-heading">Set a goal</h2>



<p>Before you begin thinking about your first investment, or choosing the type of vehicle to use, it’s crucial to figure out what you’re doing it for, experts said.</p>



<p>Dhruv Arora, CEO of digital wealth manager&nbsp;<a href="http://www.syfe.com/" target="_blank" rel="noreferrer noopener">Syfe</a>, recommended starting with a specific life goal — such as a wedding or retirement — rather than an “arbitrary numerical figures.”</p>



<p>“Rather than throwing up a number, try and be a bit scientific about it,” said Arora, noting that online calculators can help you figure out an investment strategy as a proportion of your income.</p>



<p>That doesn’t mean you must stay with that plan: “Your goals may change over time, and that’s fair,” said Michele Ferrario of online wealth platform&nbsp;<a href="http://www.stashaway.sg/" target="_blank" rel="noreferrer noopener">StashAway</a>. But it creates a tangible reward to work toward.</p>



<h2 class="wp-block-heading">Figure out your timeline</h2>



<p>Next up, figure out how much time you have to reach that goal. That will help you figure out how much you need to put away each month in order to get there.</p>



<p>As a general rule, financial advisors recommend a 50/30/20 strategy, whereby 50% of your income goes to living expenses, 30% to discretionary spending — or wants — and 20% to savings. However, that may vary depending on your goal and time horizon.</p>



<p>Often the more you can put in early on, the better. That’s due to<a href="https://www.cnbc.com/2019/02/11/how-compound-interest-works-and-how-it-can-help-you-save-money.html">&nbsp;compound interest</a>, which enables you to earn interest on your returns. But Ferrario cautioned investors to be realistic.</p>



<p>“Understand what you can afford,” he said. “If you start baking into your plan the fact that you’re to have a great career, you may be disappointed. Start with what you know you have, and then over time, you can adjust it.”</p>



<h2 class="wp-block-heading">Know your risk tolerance</h2>



<p>Alongside timeline, you need to know your risk tolerance. More often than not, the two will be intertwined.</p>



<p>“If you’re a millennial, your objectives are likely to be quite long-term in nature,” said Steve Brice, chief investment strategist at&nbsp;<a href="https://www.cnbc.com/2019/02/11/how-compound-interest-works-and-how-it-can-help-you-save-money.html">Standard Chartered</a>, noting that may give you a greater risk tolerance.</p>



<p>However, Brice noted there’s no one-size-fits-all approach. He recommended doing a scenario analysis to see how you respond to different events to ensure future downturns don’t “blindside” you.</p>



<p>Arora agreed, saying investors should be true to themselves: “If you’re not comfortable with what you’re doing this for, you will end up making the wrong investment.”</p>



<h2 class="wp-block-heading">Get diversified</h2>



<p>Once you’ve pinned down your goal and your strategy, it’s time to work out the best investment vehicle for you.</p>



<p>For many first time investors, that will be a passively managed&nbsp;<a href="https://www.cnbc.com/2019/09/19/why-index-funds-are-a-smart-investment.html">index fund</a>, which gives you access to major market indices, or a low-cost digital wealth manager which will build a portfolio on your behalf.</p>



<p>The most important element to look for, however, is diversification, experts said. This means building in exposure to different asset classes, such as equities, bonds and alternatives like property, as well as different geographies.</p>



<p>“You need to have a portfolio that’s diversified and doesn’t make you lose sleep,” said Ferrario.</p>



<p>“You should be building a portfolio that’s resilient to different risks,” Brice added.</p>



<p>Their advice closely mirrors that of legendary investor&nbsp;<a href="https://www.cnbc.com/id/10000263">Warren Buffett</a>. The 89-year-old self-made billionaire has long advocated long-term, low-risk investing that focuses on a&nbsp;<a href="https://www.cnbc.com/2018/12/17/warren-buffett-tips-on-how-to-invest-in-the-stock-market.html">diversified and detached approach</a>.</p>



<h2 class="wp-block-heading">Remember fees</h2>



<p>While digital wealth platforms have helped lower barriers to entry, the fees charged can vary across the board, so it’s important to know where your money is going.</p>



<p>As Ferrario put it, unlike other purchases, “the thing you’re buying when you invest is returns.”</p>



<p>American online financial advisor Betterment, for instance, charges a low annual fee of 0.25% on assets under management, helping it nab the title of best platform for new investors in&nbsp;<a href="https://www.cnbc.com/2020/02/13/why-betterment-is-the-best-roboadvisor-for-beginning-investors.html">a recent report</a>. The annual fees charged by U.S. robo-investors often hover between 0.25% and 0.89% — well below the several percentage points charged by traditional wealth managers.</p>



<p>Investors elsewhere in the world can find comparably low fees. Europe’s Moneyfarm charges approximately 0.7% per year, while in Asia, StashAway charges up to 0.8% and Syfe up to 0.65% — both with no exit fees.</p>



<h2 class="wp-block-heading">Forget about it</h2>



<p>The last step for investors, new and old, is to learn to forget.</p>



<p>With most investment platforms now offering some form of on-demand performance analysis, that can be easier said than done. Indeed, observing your portfolio can be a good way of monitoring your risk tolerance.</p>



<p>But it’s important not to let it disrupt your long-term strategy, said Arora, who recommended checking in on your investments on a quarterly basis.</p>



<p>“Investing should be as exciting as watching grass grow,” Ferrario added.</p>



<p><em>This article was first published on CNBC <a href="https://www.cnbc.com/2020/02/18/investing-advice-experts-share-tips-for-making-the-first-investment.html">https://www.cnbc.com/2020/02/18/investing-advice-experts-share-tips-for-making-the-first-investment.html</a> and is republished with its permission.</em> </p>


CNBC

Experts share their best advice for making your first investment


<p>You may find yourself juggling a lot financially in your 30s, like purchasing a home, switching jobs, and even having children.</p>



<p>“The greatest thing is to have options, and when you establish a good [financial] plan in your 30s and work that plan, it allows you to build those options for your 40s,” says Leslie Thompson, a chartered financial analystand the founder of Spectrum Management in Indianapolis.</p>



<p>Here are four money moves you can make in your 30s that experts say can leave you wealthier in your 40s.</p>



<h2 class="wp-block-heading">1. Update your emergency fund</h2>



<p>Financial planners suggest you aim to build an emergency fund that can cover three to six months’ worth of living expenses. You may have started this effort in your 20s, but in your 30s, it’s time to revisit your savings goal. As your expenses increase, so should your emergency fund.</p>



<p>While you’re evaluating your emergency fund, reconsider where you’re keeping it. Experts recommend putting money for a rainy day in a savings account, or another easily accessible account.</p>



<p><strong>More from Grow:</strong><br><a href="https://grow.acorns.com/why-keeping-a-100-bill-in-your-wallet-can-curb-spending/" target="_blank" rel="noreferrer noopener"><strong>Why you should always keep a $100 bill in your wallet</strong></a><a href="https://grow.acorns.com/items-you-should-rent-not-buy/" target="_blank" rel="noreferrer noopener"><strong>3 items that can be a better value to rent, not buy</strong></a><a href="https://grow.acorns.com/side-hustles-you-can-do-from-anywhere/" target="_blank" rel="noreferrer noopener"><strong>4 side hustles you can do from anywhere (that pay up to $85 per hour)</strong></a></p>



<p>Look for accounts offering high-interest yields, but note that savings account interest rates can vary widely: The national average is <a rel="noreferrer noopener" href="https://smartasset.com/checking-account/average-savings-account-interest" target="_blank">0.09%</a>, according to SmartAsset, but some high-yield savings accounts offer as much as <a rel="noreferrer noopener" href="https://www.bankrate.com/banking/savings/rates/" target="_blank">2.55%</a>, according to Bankrate.</p>



<h2 class="wp-block-heading">2. Prepare to buy a home</h2>



<p>A home is the biggest purchase most people will ever make, so it’s good to start planning early. First steps:&nbsp;<a href="https://grow.acorns.com/2-ways-to-check-your-credit-score-for-free/" target="_blank" rel="noreferrer noopener">monitoring your credit score</a>&nbsp;and saving for a down payment.</p>



<p>“The higher your [credit] score, the lower your interest rate will likely be” on your mortgage, says Thompson. Aim for a score of&nbsp;<a href="https://grow.acorns.com/the-credit-score-you-need-to-get-the-best-rate-on-a-mortgage/" target="_blank" rel="noreferrer noopener">760 and above</a>&nbsp;to get the best interest rate on a 30-year fixed loan, which could save you&nbsp;<a href="https://grow.acorns.com/the-credit-score-you-need-to-get-the-best-rate-on-every-kind-of-loan/" target="_blank" rel="noreferrer noopener">thousands&nbsp;</a>in interest over the lifetime of your loan.&nbsp;<a href="https://grow.acorns.com/matt-schulz-shares-3-ways-to-boost-your-credit-score/" target="_blank" rel="noreferrer noopener">Improving your score</a>&nbsp;takes time, but moves like paying bills on time and keeping balances low can help.</p>



<p>Then set a savings goal for your down payment. Experts typically recommend <a rel="noreferrer noopener" href="https://grow.acorns.com/how-much-money-you-actually-need-to-put-down-to-buy-a-home/" target="_blank">aiming for 20%</a>, although the median is 7.6% — and you may qualify for certain mortgages that let you put down as little as 3%, or nothing. To prepare for the purchase, set up <a rel="noreferrer noopener" href="https://grow.acorns.com/set-up-automatic-bill-payments/" target="_blank">automatic</a> saving contributions. “Saving up for a down payment can make your mortgage more manageable, and perhaps allow you to buy a more expensive home,” she says.</p>



<h2 class="wp-block-heading">3. Get—and stay—on track for retirement</h2>



<p>Having a solid foundation for retirement is “the single best move” you can make, says Stephen O’Hara, a certified financial planner and vice president of Wealth Enhancement Group based in Minneapolis, Minnesota. He says the best way to get ahead on retirement savings is by&nbsp;<a href="https://grow.acorns.com/what-is-a-401k-match/" target="_blank" rel="noreferrer noopener">maximizing your employer 401(k) match</a>, ifyou have a job thatoffers one.</p>



<p>By the time you’re 30, Fidelity <a href="https://www.cnbc.com/2019/05/23/how-much-money-americans-have-in-their-401ks-at-every-age.html">recommends</a> having a retirement fund that’s equal to your starting salary. By age 35, your retirement savings should be <a href="https://www.cnbc.com/2018/11/12/how-much-money-to-have-saved-by-age-35.html">twice your annual salary</a>. While that benchmark is just a guideline, it can help you gauge if you should be boosting your contributions. In general, a good retirement contribution target is 15% of your annual salary.</p>



<p><strong>The difference annual increases can make</strong></p>



<p>Automatically adding 1% to your 401(k) contribution each year can make a big difference by the time you retire.</p>



<figure class="wp-block-image size-large"><img decoding="async" loading="lazy" width="600" height="418" src="https://www.cnbcafrica.com/wp-content/uploads/2020/02/grow-1.png" alt="" class="wp-image-355714" srcset="https://cms.cnbcafrica.com/wp-content/uploads/2020/02/grow-1.png 600w, https://cms.cnbcafrica.com/wp-content/uploads/2020/02/grow-1-300x209.png 300w, https://cms.cnbcafrica.com/wp-content/uploads/2020/02/grow-1-100x70.png 100w" sizes="(max-width: 600px) 100vw, 600px" /></figure>



<p><a href="https://grow.acorns.com/how-to-save-for-retirement-when-you-dont-have-a-9-5/" target="_blank" rel="noreferrer noopener">If you don’t have a workplace retirement account</a>, you can explore different options like&nbsp;<a href="https://grow.acorns.com/how-an-ira-can-help-you-grow-your-wealth-and-retire-comfortably/" target="_blank" rel="noreferrer noopener">opening an IRA</a>, says O’Hara. “Each time you experience a pay raise, try to raise what you’re putting away [for retirement],” he says. If you can’t put in 15% of your annual salary initially, then try increasing your&nbsp;<a href="https://www.cnbc.com/2019/05/23/how-much-money-americans-have-in-their-401ks-at-every-age.html">contribution by 1%-2%</a>&nbsp;every year until you get there.</p>



<h2 class="wp-block-heading">4. Balance your long-term financial goals</h2>



<p>Your 30s can be full of big financial changes, so you’ll want to be mindful of how you spend and save money, says Thompson. The first thing you should do is look at your big-picture goals,and pick&nbsp;<a href="https://grow.acorns.com/money-lessons-everyone-should-know-by-age-30/" target="_blank" rel="noreferrer noopener">three to focus on</a>.</p>



<p>Let’s say you want to buy a home, take an international trip with the whole family, and chip away at student debt. Start by calculating&nbsp;<a href="https://grow.acorns.com/how-to-make-a-personal-budget/" target="_blank" rel="noreferrer noopener">the amount you need&nbsp;</a>to put aside each month in order to achieve each goal by a target date. Then look at your bills, says O’Hara. By taking a hard look at your expenses, you can figure out where you’re overspending, and what areas, like dining out or entertainment, you may need to cut back on in order to stay on track to meet your goals.</p>



<p>“If you want to take a 10-day trip to Greece, you’re going to start looking at your happy hour bills and go, ‘This is not in alignment with meeting that goal,’” says O’Hara.</p>



<p>Though many people have a tendency to tackle financial goals one at a time, it makes sense to work on a few at once. “It all starts with putting those first dollars away,” and letting those savings habits build on each other, he says.</p>



<p><em>This article was first published on CNBC <a href="https://www.cnbc.com/2020/02/10/do-these-4-things-with-your-money-in-your-30s-to-be-richer-in-40s-finance-experts.html">https://www.cnbc.com/2020/02/10/do-these-4-things-with-your-money-in-your-30s-to-be-richer-in-40s-finance-experts.html</a> and is republished with its permission.</em></p>


Do these 4 things in your 30s if you want to be richer in your 40s, money experts say

<div style="max-width: 700px;"><video-js data-account="1571595826001" data-player="default" data-embed="default" controls="" data-video-id="6094660753001" data-playlist-id="" data-application-id="" class="vjs-fluid"></video-js></div>
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<p>Limited access to education, finances and scarce employment opportunities are some of the challenges facing Africa’s youth. To share her thoughts on how these can be addressed, Rehema Dominick Sanga, Founder and CEO of Organization for Capitalizing Community Resources &#038; Initiative joins CNBC Africa.</p>


Dominick Sanga on how best African youths can be empowered for the future


<p>By <strong>Shiree Coetzer</strong> <strong>CFP<sup>®</sup>l</strong> <strong>Financial Planner l</strong> <strong>Financial Planning Consultants, Alexander Forbes  </strong></p>



<p>To the ladies out there who are still waiting for their knight in shining armour to rescue them, to save them from their troubled times and to ride off into the sunset in a Ferrari: this article is for you. </p>



<p>That knight  is probably divorced with a few children and has money woes of his own, therefore there is only one way ladies, you have to do it for yourselves.</p>



<p>Some ladies are fortunate to have a partner in the true sense of the word, you can then work together to ensure that you plan accordingly, but many ladies are on their own and need to ensure that you can take care of yourself and your children and can be proud of being able to do so.</p>



<p>Based on my experience as a financial planner my concern is that females are often reliant on their partner to make the most of the financial decisions in the household. Many females  do not take the time to understand the long term financial implications of the decisions made and are not aware of : Household savings or debt; bond balance; household expenses; savings held etc. , .  </p>



<p>It takes just a little bit of time to ensure that you remain on track to understand the importance of your own financial planning.</p>



<p>I recommend that you ask yourself the following questions:</p>



<ul><li>What type of marital contract did we enter into?(if applicable)</li><li>Did you get married in community of property or out of community of property(OCOP)?  If OCOP: was it with or without the accrual system?</li><li>What does that mean?</li></ul>



<ul><li>If you plan to co-habit, what are the contractual options available to you to ensure that you are protected if you break up?</li><li>Contrary to popular belief, there is no ‘common-law wife’ in South Africa</li></ul>



<ul><li>Do you have any emergency savings?</li><li>Ideally 3 months’ worth of household expenses </li><li>Why?  This means that you will not have to use your credit card or an overdraft if the car needs tyres or the washing machine is out of operation </li></ul>



<ul><li>Do you have a retirement fund?</li><li>Either through your employer in the form of a pension or provident fund or your own retirement annuity</li><li>How much are you saving into the fund on a monthly basis?</li><li>Is it enough? </li></ul>



<ul><li>How much is enough to retire on? </li><li>This is an article on its own, but a ‘rule of thumb’ is are you able to replace your income by at least 75% when you retire</li></ul>



<ul><li>Do you have discretionary savings? </li><li>These are additional savings other than emergency savings e.g. savings towards a new car, a nice holiday, education for your children etc.</li></ul>



<ul><li>Do you have a will?</li><li>Either your own will or a joint will</li><li>Where is it held?</li><li>Who is the Executor?</li></ul>



<p>A will is always important, but especially so if you have dependent children</p>



<ul><li>Do you have a financial planner looking after your financial wellbeing?</li></ul>



<p>All of these questions can be answered by having a certified financial planner looking after your interests.  At the very least, start by reading up on the items above and learning a bit about all of them over time.  The more you understand, the better equipped you are to make informed decisions. </p>



<p>So, should the proverbial knight arrive,you can have the choice of whose vehicle you are going to ride off in….or simply stay in your own</p>



<p></p>


South Africa's Quantum Foods warns of 38% drop in first-half profit

South Africa’s Quantum Foods warns of 38% drop in first-half profit. budget_shutterstock_249974521

How to be your own financial heroine in 2019

<p>When it comes to matters of the heart, people often say that “opposites attract.”  If this is indeed the case, it may also hold true that two individuals in a romantic relationship deal with money matters in very different ways.</p>
<p><img decoding="async" loading="lazy" class="aligncenter wp-image-298798 size-full" src="http://cnbc.africa/wp-content/uploads/2018/02/Couples_Savings_01_Black-Enterprise.jpg" alt="" width="1000" height="667" /></p>
<p>The nature and magnitude of the differences may vary based upon each partner’s relationship with money as well as their respective value systems. While couples might believe they hold similar values around major issues such as lifestyle, religion, and raising kids, values around finances could hold surprises for both.</p>
<p>Financial stress is often singled out as main contributor to a break-up or divorce, surpassing other reasons such as cheating, and annoying habits. Security and stability in our household and relationship are what we all seek, and if our partner’s overall wellbeing is such an important factor, why do we often avoid discussing our finances?</p>
<p><strong>Avoiding the money conversation </strong></p>
<p>Money is a sensitive topic of conversation, which is often avoided. People frequently take their financial expectations for granted, and don’t always see the need to discuss their money matters as clashes in this area often lead to arguments and resentment.</p>
<p>Various other factors may also play a role: whether we view this person as our potential life partner; and whether they are mature enough to grasp the magnitude and importance of such discussions.</p>
<p>One of the partners must however be bold enough to take the lead when it comes to initiating the money conversation and agreeing on a financial management journey that both parties are comfortable with.</p>
<p>There are a number of questions you need to ask yourself before initiating this very important discussion with your partner:</p>
<ol>
<li><strong>How ready are you to talk about your finances</strong>? Many people use money discussions to interrogate the other partner while they are not prepared to share the details of their finances if the tables are turned.  Each party should show a willingness to openly discuss the state of their finances.</li>
<li><strong>Do you save and invest</strong>? According to a SunTrust study, people who save or invest are generally trustworthy people. This equally applies to people who have good credit scores, as this is a great indication of how good they are at managing their debt.</li>
<li><strong>Are you planning any significant long-term financial obligation</strong>, like buying a house or a car? Are you saving for a deposit for this? Its okay to bluntly ask: “So how are you planning to pay for this?” Your own experience may help to guide your partner in finance options.</li>
<li><strong>How healthy is your credit score? </strong>There is a growing school of thought who believe that the healthier the credit score, the more trustworthy a person. So besides the need to understand how good your partner is at managing their debt, you could benefit from further understanding the nature of the person you are committing to.</li>
<li><strong>Are there any non-credit-related but equally long-term commitments? </strong>Obligations like garnishee orders, black tax and child support are longer term commitments. As a partner you need to understand these dynamics, especially if you intend to have children of your own one day.</li>
<li><strong>Can you ask the Lobola question? </strong>This is possible once the question of marriage has already been raised. How is this going to be paid for? Are you comfortable with credit-led Lobola or would you rather be patient enough for your partner to save to pay his dues?</li>
</ol>
<p><strong>Building a future together </strong></p>
<p>Ask yourself: can you work with your partner to build a better future, one that is savings, investing and wealth creation-led, where financially prudent decisions will be made jointly?</p>
<p>This will enable you to build a financial legacy for yourselves and your family. I call this the #WealthLegacyProject. This all starts with planting small and manageable financial seeds, which need to be nurtured to avoid financial mistakes being deferred to the next generation.</p>
<p>This Valentine’s month might be the right time to raise this topic with your partner. The money conversation may test the resilience of your relationship, but as long as the result is a concrete plan on how to save to spend, save to invest, and create wealth together, you are on the right path.</p>
<p>These are not meant to be emotional discussions, but rather open-minded conversations between two mature people who are in it for the long haul.</p>


Money, love and happiness: The best time to start the money conversation is right now

<p>For many wealthy individuals and families the beginning of the year serves as an opportune time for personal introspection making it the ideal period to review financial goals and strategies for dealing with the challenges of growing and preserving wealth in a volatile economic climate.</p>
<p>Eric Enslin, CEO of FNB Private Wealth and RMB Private Bank, says “High-net worth individuals take into account a variety of economic, regulatory and investment factors as well as family and career aspirations when planning for the year ahead. Advisors are required to thoroughly assess the state of their clients’ long-term wealth growth, while guiding them on how to overcome and understand some of the key issues and trends that keep them engaged around the dinner table.”</p>
<p>Enslin has identified four industry trends affecting high-net worth individuals that advisors should take into account when reviewing long term wealth strategies. </p>
<p><strong>Fintech</strong> – the rapid growth of fintech should not be seen as a threat to advisors, but rather an opportunity to tap into innovation through the use of tools, analytics and technology to better understand and efficiently cater for the dynamic and ever changing needs of high-net worth individuals.</p>
<p><strong>Life expectancy</strong> – according to the ‘Ageing World Report’ released last year in March by the U.S. Census Bureau, 8.5 percent of the world population is aged 65 and over, and this older population is expected to continue growing over the next 35 years.</p>
<p>Increasing life expectancy continues to put more pressure on advisors to exercise greater flexibility when helping clients to plan financially for retirement. This has a huge impact on the accurate projection of medical and living costs.  </p>
<p><strong>Economic uncertainty</strong> – the current challenges facing South Africa and the possibility of a sovereign credit rating downgrade in 2017 is growing concern amongst high-net worth individuals. This is likely to increase the prospect of investors looking for more exposure to offshore investments as means to diversify their wealth.</p>
<p>There will be increased pressure on advisors to offer sound advice taking into account the diverse risks and opportunities of investing offshore.</p>
<p><strong>Local and global legislation</strong> – ongoing changes in legislation significantly increase financial demands and risks facing wealthy individuals on a yearly basis. Therefore, it is essential for them to regularly review and adjust their risk and wealth management strategies accordingly.</p>
<p>“As an example, high-net worth individuals are waiting with bated breath for the outcome of the much debated, Draft Taxation Laws Amendment Bill from Treasury which will impact taxation on personal trusts. From a global perspective, concerns around the long term impact of Brexit on the global economy are ongoing,” says Enslin.</p>
<p>“Although wealthy individuals and families take a long term view when devising growth strategies, each year has a unique set of challenges, making it essential for advisors to constantly familiarise themselves with the issues and opportunities that keep their clients awake at night. This gives high-net worth individuals piece of mind knowing that they are receiving the best advice to achieve their goals and continue reaching important milestones in their wealth journey,” concludes Enslin.</p>
<p><em><br /></em></p>
<p>END</p>
<p>For more information contact: </p>
<p>FNB Corporate Communications</p>
<p>Senzi Dlamini: <a href="mailto:Senzi.Dlamini@fnb.co.za">Senzi.Dlamini@fnb.co.za</a> or 087 335 8277﻿</p>


Trends affecting wealthy individuals in 2017

<p>Irregular expenditure by South African government departments swelled 80 percent to 43.4 billion rand ($3 billion) in the 2015-16 financial year, Auditor-General Kimi Makwetu said on Wednesday.</p>
<p>South Africa is trying to rein in spending and trim debt in the face of sluggish economic growth and looming decisions by major ratings agencies that could see it lose its investment grade status, a development that would lift borrowing costs.</p>
<p>Makwetu said in a statement after releasing his annual report that most of the irregular spending, which would have accounted for about 3 percent of total government spending, stemmed from non-compliance with regulations on the procurement of goods and services.</p>
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<p>&#8220;Due to a lack of transparency and competitiveness, it remains to be seen whether prices are not inflated in the procurement processes,&#8221; the statement said.</p>
<p>Expenditure deemed &#8220;fruitless and wasteful&#8221; increased 14 percent since 2013-14 to 1.37 billion rand, the statement said, without providing a comparison to the 2014-15 financial year.</p>
<p>Makwetu said poor management, shoddy probes into allegations of financial transgressions, and vacancies that remain unfilled in key positions such as accounting officers, were &#8220;the root causes of &#8230; weaknesses in financial and performance management and the poor audit outcomes.&#8221;</p>
<p>Makwetu recommended improved monitoring of expenditure, the provision of compliance checklists to monitoring units and supervisors, and the implementation of formal codes of conduct but stopped short of calling for a probe.</p>
<p>The Treasury did not immediately comment on the report.﻿</p>
<p> </p>


Irregular South Africa government expenditure up 80 pct

<p>The International Monetary Fund has removed remedial measures against Zimbabwe after the country settled its overdue financial obligation to the Fund&#8217;s Poverty Reduction and Growth Trust last month, the IMF said on Monday.</p>
<p>The move by the IMF&#8217;s executive board lifts a declaration that Zimbabwe is not cooperating with the organization, ends a suspension of technical assistance to Zimbabwe and restores Zimbabwe to the list of countries that are eligible to benefit from the trust.</p>
<p>Zimbabwe restored about $107.9 million in arrears on Oct. 20, ending more than 15 years of arrears to the trust.</p>
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<p>The board decision is another step towards normalizing relations with the Fund. But the IMF has said it cannot consider a new IMF loan program for Zimbabwe until the country clears more than $1 billion in World Bank arrears and another $600 million-plus owed to the African Development Bank, as well as any arrears to bilateral lenders and private creditors.﻿</p>
<p> </p>


IMF lifts censures against Zimbabwe

<p>An in-depth look at the incredible power of compound interest shows just how important it is to start saving for retirement as soon as possible. Those who start early, like Xoliswa, get a real head start in building wealth for retirement.</p>
<p>However, a retirement savings strategy isn’t static – it needs to change and adapt as you move through different life stages. In other words, a 23-year old will approach retirement investment differently to someone who is 58.</p>
<p>Of course there isn’t a simple “one-size-fits-all” plan for retirement saving. For one thing, we all face different circumstances, and for another, life just doesn’t follow a completely predictable trajectory. Despite this, there are some broad truths that usually apply to different age groups.</p>
<p><strong>When you’re in your 20s</strong></p>
<p>Even though you are possibly earning well below your earning potential, Craig Gradidge, the co-founder and investment specialist at Gradidge Mahura Investments, says “this age group stands to benefit the most from the power of compounding. They need to start even if it is with a small contribution”.</p>
<p>“The most important things for young people to consider are portfolio suitability and cost structure,” says Gradidge. Young savers need to have a portfolio that is engineered to ensure they benefit from compounding. At this age, you “need to have sufficient exposure to growth assets such as listed property and equity”.</p>
<p>However, with this exposure comes risk. The advantage of youth from an investment perspective is that you have time on your side – your money has more time to recover from market pullbacks and dips.</p>
<p>It is equally important for young savers to consider costs and fees in their investments. “A high cost structure can be a significant drag on portfolio returns over the long term,” explains Gradidge.</p>
<p><strong>When you’re in your 30s – 40s</strong></p>
<p>From your early to mid-thirties, your expenditure tends to increase. You buy a house. Upgrade your car. Start a family. On the other hand, you are also likely to be far more settled in your career and earn more than in your 20s.</p>
<p>At this stage of your life, says Gradidge, the “issue of debt management becomes critical, as well as protection of incomes” (especially once you have children). It is typically in this stage of your life that you start to incur high levels of debt. Appropriate management of debt is critical to long-term financial success as over-indebtedness can ruin you.</p>
<p>In this age range, you need to focus on the balance between managing debt and ensuring your retirement saving goes according to plan. There is often a difficult tension between the two because life events tend to be prioritised, leaving little left for saving.</p>
<p>This is a time in your life where discipline in saving is arguably most important. We’re quick to look for excuses to use savings to pay down debt, but very few of us have the discipline to actually save the freed-up money once debt is paid off. It’s important to distinguish between expensive and inexpensive debt. Paying off credit cards and loans is getting rid of expensive debt. But some debt, like a home loan, might not be that expensive, relatively speaking.</p>
<p>There’s no right or wrong answer when it comes to electing to settle debt instead of saving. In theory, you should force your cost of living lower and try to do both. If you have not started saving for retirement, remember that it is never too late to start.</p>
<p><strong>When you’re approaching retirement</strong></p>
<p>It’s natural for you to become more conservative as you approach retirement, says Gradidge, “especially as your retirement nest egg grows in size. Older people would also have experienced a lot more and seen others lose everything due to imprudent decision-making, or to scams”.</p>
<p>Traditional advice suggests you gradually shift out of equities in favour of less risky asset classes like cash and bonds as you head towards retirement. However, we’re living longer and advisors are starting to advocate for leaving a greater proportion of your retirement savings in equities for longer. Remember, at age 60, you may very well have another 30 years to live – equal to the amount of time you’ve been saving until that point!</p>
<p>The tendency to become too conservative as you approach retirement needs to be “managed by your financial adviser to ensure that it does not become too destructive to your financial position over time,” says Gradidge. At this stage, it is important to save as much as you can, given you are most likely at your peak earning potential.</p>
<p><strong>When you’ve reached retirement</strong></p>
<p>Many guides to saving for retirement do not offer a view of or advice for the actual retirement period. Because it is usually so far in the future and difficult for us to conceptualise, savers tend to think of retirement as an event.</p>
<p>“It can be an extremely emotional time for people,” says Gradidge. “Many have gotten used to getting up in the morning and going to work, as they have been doing so for 35 or 40 years. And to lose this structure could be quite traumatic.”</p>
<p>“Everyone will ‘view’ retirement differently based on their experiences and own expectations. Those who have saved sufficient capital may look forward to it with a great deal of excitement. Those who have not saved enough may view it with a sense of trepidation. Others may be largely indifferent to the whole matter”.</p>
<p>“The important thing,” says Gradidge, “is that the advisor understands where the client is at, and adjusts the advice process and interaction with the client accordingly”.</p>
<p>During retirement, your exposure to risk obviously adjusts downward. However, it is important not to become ultra-conservative immediately as you’ll likely forgo significant growth in your portfolio, and very quickly begin to underperform inflation (in effect, the value of your savings will start to decrease).</p>
<p> </p>
<p><em>Discovery Invest is an authorised financial services provider. Registration number 2007/005969/07. For more information on Discovery Invest, contact your financial adviser.</em></p>
<p><em>This material is provided for educational purposes only and should not be construed as investment advice or an offer or solicitation to buy or sell investment funds.﻿</em></p>


Life changes – and so should your retirement planning

<p>South African Airways said on Monday it has been granted a three-week extension to submit financial statements to Hong Kong or risk losing the lucrative Asian route.</p>
<p>The state-owned carrier, which has failed to publish annual statements for the past two years and is in danger of defaulting on its debt, was initially given a Sept. 6 deadline by Hong Kong.</p>
<p>The deadline has now been pushed back to Sept. 30, SAA spokesman Tlali Tlali said.</p>
<p>&#8220;We are confident that we will meet all outstanding requirements. It is extremely unlikely that SAA&#8217;s service on this route will be terminated,&#8221; Tlali said.</p>
<p>Marred by controversy and financial mismanagement, the airline has been surviving on state guarantees of around 14.4 billion rand ($1 billion) and has been singled out amongst other state companies by ratings agencies as a major risk to the country&#8217;s investment grade status.</p>
<p>Its results for 2015/16 have been held back by the Treasury&#8217;s refusal to grant the loss-making carrier 5 billion rand in additional guarantees.</p>
<p>In a newspaper notice last week, the airline said it planned to raise 16 billion rand from lenders. </p>
<p>The main opposition party, Democratic Alliance, said on Monday it planned to challenge Friday&#8217;s reappointment of Dudu Myeni as SAA&#8217;s chairwoman, accusing her of being responsible for the crisis at their airline. </p>
<p>($1 = 14.3926 rand)</p>
<p> </p>


South African Airways granted extension to file in Hong Kong

<p>The International Monetary Fund (IMF) is evaluating Ghana&#8217;s fiscal outlook for the rest of 2016 and will consider the third review of the country&#8217;s $918 million assistance programme next month subject to the outcome, the Washington-based lender said on Monday.</p>
<p>Ghana, which exports cocoa, gold and oil, signed the three-year aid deal in April last year to bring down budget deficits, inflation and a high public debt.</p>
<p>&#8220;Discussions between staff and the authorities are currently ongoing to update macroeconomic projections, firm up the fiscal outlook for the remainder of 2016 and ascertain that financial pressures in SOEs will not pose additional risks to the central government budget,&#8221; the Fund said in a statement.</p>
<p>&#8220;Subject to a quick and positive conclusion of these discussions, staff expects the third program review to be considered by the IMF Executive Board around mid-September,” it said.</p>
<p>The government had expected the Executive board to conclude the third review in June to enable it receive a fourth disbursement of around $115 million in balance of payment support.</p>
<p>The West African economy has agreed remedial measures including financial and institutional reforms to cut spending and spur growth.</p>
<p>Finance Minister Seth Terkper said last week the IMF deal was yielding positive results and that Ghana was on target to halve its fiscal deficit this year.</p>
<p> </p>
<p>(Reporting by Kwasi Kpodo; editing by Grant McCool)﻿</p>


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IMF evaluates Ghana's fiscal outlook for rest of 2016

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