The language and logic of financial planning demistified

" So, let's look at tax first. If a person retires at 65, the rebate on interest is R32 000 per year.

At current money market rates of about 7%, you will pay tax on amounts over R456 000.

Even if you don't have R456 000 cash, the return right now is still only 7% and inflation is about 6.3%. Over time this trend tends to average out to about 1% to 2% real return on cash.

This is why some form of risk is taken by investing in shares or property.  Read the entire article at: http://www.fin24.com/articles/default/display_article.aspx?ArticleId=2575212

 

According to Mike Brown, CEO of online transacting platform etfSA only 5 out of 47 actively managed unit trust funds (mutual funds) were able to outperform the Satrix to 40 over the 5 years from 2005 to 2010. Read the rest here:    http://www.fin24.com/articles/default/display_article.aspx?Channel=News_Home&ArticleId=1518-2438-2439_2577120&IsColumnistStory=False

Media24's business news reported on Thursday 25th March 2010 that Marriott Asset Management CEO, Dr Simon Pearse said the average money market instrument had nominal returns of 10,1% per year over the period 2007 to 2010. In the same period equity (shares) returned 2,6% or 6,5% in an industrial index, or 7,5% in commodities.