Go to fin24.com they have some calculators you can use easily. Even old mutual have themOriginally Posted by InternetSwag
Go to fin24.com they have some calculators you can use easily. Even old mutual have them
He cant guarantee you a return like that. But it is generally better to invest in something like a unit trust than a savings account or retail bond in the long term as the stock market generally outperforms other avenues of investment.
However, with more reward comes more risk. There are many unit trusts out there that dont require a minimum period of investment - take a look at ABSA's site for some examples (i'm sure the other banks have the same).
You will find that it's not old mutual, but rather a scalely broker over selling an old mutual product. Those brokers are dodge. You can get a financial planner for free at nedbank, they just get commission based on what you go with, but it's declared and safer than those fly by night brokers that come visit.
Make sure he is an OM rep, check credentials get everything in writing and verify. Don't trust anyone these days. He should carry with him a official rep certificate from OM.
cANCer - "The problem with socialism is that eventually you run out of other people's money." -- Margaret Thatcher .
Tell him to guarantee those returns, then work it out.
Otherwise it is just a waste of time.
BTW, my Old Mutual returns over a long period were quite mediocre - I wouldn't invest with them.
I'm ashamed of South Africa. It's an absolute disgrace that you can pass matric with a mark of 30 percent." - Jonathan Jansen
Sorry but I think you don't know what you are talking about. The returns in unit trusts bought monthly are effective because you are buying units over a long perod of time. When the unit price goes down you are buying more units for the same monthly investment. When the value goes up the extra units you bought low are now worth that much more and of course you have that much more of them. The value not only of your uand nits goes up but you have that much more of them and therefore it compounds. This mostly wipes out the risk factor as you really want to be buying low and selling high. So while the fund might only do 5% a year for 5 years you of course win on both ends to a factor way higher than 5% per annum.
On another note, possibly the worst invesment a person can make is property. Rent property and invest the difference you would pay on a bond into the market and you will have bought your house cash way before you would have completed your bond payments(with interest). It also keeps your assets liquid.
Every time you invest your money in a bank remember they are investing ur money in the market, making a huge pofit and the paying you a very low guaranteed rate. That's not called "playing it safe" that's called being a sucker.
In all the years I worked for O.M I never was given an official rep certificate. Yes O.M reps are accredited and there are ways to find out but you can't ask for a certificate. Unless something has changed in he past 2-3 years but then I would have heard about it.
Look in a mirror - you clearly have no idea !
I'm ashamed of South Africa. It's an absolute disgrace that you can pass matric with a mark of 30 percent." - Jonathan Jansen
Check fees and costs. Compare to other investments with an independent broker across different companies. Don't tie in for 10 years, rather go with an "as and when" collective investment (unit trust). If you stop a 10 year investment you'll suffer penalties.
While there is nothing wrong with an "as and when "investment not many people have the discipline and dedication to benefit from the strengths and compunded interest of investing monthly.
Old Mutual unit trusts are almost always a flexible product. You can withdraw with 10 days - 2 weeks notice leaving a minimum of 30% in the fund without penalty. So it's not like you can't touch your money for the full term. Thre;s products exist becaue they work. They are no a scam. People telling you they know better probably ought to reveal how they made their billions by going against age old investment advice and tecniques or STFU.
Last edited by baxter; 09-08-2012 at 03:34 PM.
Read the OPs post - "binds you to ten years minimum". Does not sound like a unit trust to me...
And a true unit trust would not impose any limits on what you can withdrawal.
Old mutual delibrately tried to combine the benefit and liquidity of a unit trust invesment with the benefit of a medium to long term investment in a rage of products the called the LISP range . They incentavised the term by offering access to your money in the money market model.
The reason they did this was that brokers were chosing to sell long term endowment/saving policies to reap the higher commisions but what their cients really needed was a packaged unit trust offering with an incentive to go the term. It offers the best of both worlds. Unit trusts are only a high percentage investment and high yield investment if you at least go the medium term. Then the yields can easly match the 15-18% spoken about. Too many idiots sell up their unit trusts whe the market tanks, which is etirely the wrong thing to do. That's when you should be buying units so you can ride the up wave.
Last edited by baxter; 09-08-2012 at 03:46 PM.
Sounds like precisely what us happening here.
Why would this product, if it works as you state, be in the best interests of the client when compared to a unit trust with absolutely no restrictions? Is it much cheaper?
Nobody can guarantee such high yields. But a long term unit trust investment can easily reap those growth rates by taking advantage of natural market fluctuations. In fact far less risk adversive funds like have done 35% in the period. With no risk you can't expect any large rewards. And any broker worth his salt would have worked out your risk portfolio and how much you could afford to expose of your assets to various investment opportunities.
OP is this what he tried to "sell" you ?
http://www.oldmutual.co.za/personal/...x?audienceid=2
Just reading on the Old Mutual website and, if the product in question is their "investment plan", then this just sounds like a normal endowment from any other company...
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