Personal Finance Magazine

The sponsored article by private wealth manager Melville Douglas on pages 34 and 35 ends with the words “it’s personal”, referring to the quality of client service on which the company prides itself. But without detracting from what Melville Douglas has to offer, I believe “it’s personal” has become the bar above which financial services companies will need to operate in the future to succeed. The relationship between the industry and the consumer has been a rocky one. For decades, products and services were weighted in favour of the industry: the predominant business model, where you were persuaded to buy inappropriate products on the “advice” of commission-driven salespeople, put company profits before your interests. There is still much room for improvement, but the “democratisation” of financial services – first through the proliferation…

Manage your Money Wisely to Create Wealth – Your Personal Blueprint for Financial Freedom Author: Arnold Singh Publisher: Beyond the Vale Publishing Order the book from asinghfp@gmail.com (R200 + R100 postage) Arnold Singh has an Advanced Post-graduate Diploma in Financial Planning from Free State University and a Masters degree in taxation from North West University. He was a financial planner for 17 years and lectured in wealth management to post-graduate students at the University of KwaZulu-Natal. He has distilled his vast knowledge and experience of personal finance into this comprehensive book, which covers all aspects of daily money management and wealth creation. Levels of financial literacy in South Africa are unacceptably low. This state of affairs has led to high levels of indebtedness among consumers and low saving rates, with the consequence that only a…

BENEFITS FOR MY NEW EMPLOYEES I’ve just started a company together with three other shareholders and we are currently mapping out the employee benefits. Has Covid-19 changed anything fundamental in this space? Given the current troubled health landscape of Covid-19, increasing mental illness rates and mounting financial pressure on staff, what are the key benefits that we should be focusing on to ensure a healthy, safe and productive environment? Name withheld John Cranke, PSG Wealth, Midlands, replies: Apart from the inclusion of vaccination, testing for and treatment of Covid-19 into the Prescribed Minimum Benefits for medical schemes, not much has changed from a legislative perspective for businesses wanting to extend employee benefits packages to their employees for the first time. However, the pandemic has definitely reinforced the importance of employee benefits, including the mental…

Most of us are greedy, dreaming of an unrealistically high return on our hard-earned money. To earn higher returns we must take on extra risk, but higher risk does not always result in higher returns. Just ask those who invested in African Bank to get a slightly higher interest rate or investors in Steinhoff who ended up with losses. On the other hand, to leave our money in cash at current interest rates means that we may think that we are earning a good return, but our money is losing value in buying power. One of the saddest stories I recall is that of a relative who worked hard for many years and then retired, to live on the income from her investments. She was cautious and invested all her money…

“I’ve found that you can provide clients with all the advice they want, but some follow through with implementation and others don’t,” says Melony Jacoby, a Certified Financial Planner (CFP) who practises in Durban. “This bothered me; I felt that a piece of the puzzle was missing, but I wasn’t equipped to ‘nudge’ the client or understand what was holding them back from making a decision.” This feeling – that there is a behavioural aspect that is missing from the financial planning process – set Jacoby on a trajectory of upskilling herself to gain the understanding and the competencies she needed. “I started researching financial behaviour and how the brain works in terms of decision making, and then did several types of coaching courses of six months to a year in…

RSA Retail Savings Bonds are attractive to people wanting to save, but they’re also an attractive proposition for retirees requiring a risk-free, steady retirement income from discretionary savings. These bonds, issued by National Treasury and available to South Africa consumers, traditionally came in two types: those that have a fixed interest rate for the term of the bond, and inflation-linked bonds, which have a lower rate but in which the capital is adjusted by the inflation rate. (A third type, the top-up bond, has recently been added. See page 15.) While the fixed-rate bonds can be used for saving or for income, as interest compounds over the term if reinvested, the inflation-linked bonds can only practically be used for income, because interest is paid out and therefore does not accumulate and compound. The…