Investment advice again.

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kahoel117

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A while back I had about R300k that I had/have in an ABBA investment advantage account. With working a lot the past two years I now have double that. But still in the same account. Which is maybe 5% interest +/-. Obviously this is my own fault for not seeking advice from a financial advisor at the time. I guess I just kept putting it off and forgot about it. I shudder to think what I could have had. So basically I need partial availability to my money. Maybe 20%. Any advice would be appreciated. Thanks
 
kahoel117 said:
A while back I had about R300k that I had/have in an ABBA investment advantage account. With working a lot the past two years I now have double that. But still in the same account. Which is maybe 5% interest +/-. Obviously this is my own fault for not seeking advice from a financial advisor at the time. I guess I just kept putting it off and forgot about it. I shudder to think what I could have had. So basically I need partial availability to my money. Maybe 20%. Any advice would be appreciated. Thanks
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Winner takes it all. Maybe because he's a super trooper. Just don't spend it all on a dancing queen....
 
If you have 600k and may need access to 100k , can you invest and forget about the other 500k for a few years ? Or still wish to have a chance of getting to it at short notice and therefore capital preservation is important ?
 
@gimpex : the R500k I don't need now. Or won't need it in the immediate future. The rest that I have access too is for emergencies or if I need to buy something.
 
Assuming you have no debt ( bond etc ) then you have a few options , depending on what your gut feel and personal views are. I am sure you will get a lot of pro and cons to each of these from fellow members :)

- property buy to let. Less liquid then most other investments but over a period of time (assuming good property ) it should reward you in both regular income and ( over a longer term ) capital growth. At least if you buy right your capital should be safe.

- shares / equity - various possibilities there - direct investment in shares ( local and or foreign ) , invest in active or passive funds. I would split the 500 between a few funds or a number of shares . Personally I like safe , dividend paying companies. Won't make you a millionaire overnight but will let you sleep easier. Again , regular income (which you could reinvest ) and over a number of years capital appreciation likely.

A combination of above.

There is of course other investment ( gambling ) opportunities but since you are asking here , I guess speculating is not what you are looking for.
 
To add to the above. There are various " capital guarantee " products with a fixed term , normally around 5 years , normally the upside is unknown and dependent on some future event , example a % of some index etc. These are good if you know you will not need the money at all during that time. Some are 100% capital guaranteed and some are capital guaranteed as long as some index doesn't fall below a specific level.

Investec is one of the providers of these , I am sure there are others
 
MikyMouse said:
You could also look at Exchange Traded Funds or index tracking Unit Trusts
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...just not right now. Just wait till the current **** that hath hiteth the fan is cleared up :mad:
 
OP with that amount, I would also look into offshore options. Many off these require pretty substantial minimum amounts, so if you have the opportunity now might be the time to do it?
Coronation I think require a minimum of $15 000, Allan Gray $10 000 etc.
But yeah, pretty much what gimpex said.
Oh, and the Maldives. Go there for a bit!
 
Make sure you put R30 000 a year into tax free investment account invested in ETFs.

Then the rest in high equity ETFs or unit trusts or shares directly.

Remember that you can sell shares and unit trusts in a couple of days and have the money, so it isn't tied up if you need R100k urgently. So probably invest all R600k then. No need to keep R100k liquid.
 
Gaz{M} said:
Make sure you put R30 000 a year into tax free investment account invested in ETFs.

Then the rest in high equity ETFs or unit trusts or shares directly.

Remember that you can sell shares and unit trusts in a couple of days and have the money, so it isn't tied up if you need R100k urgently. So probably invest all R600k then. No need to keep R100k liquid.
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+1
 
Very informative info! Thanks. Will definitely have a look into it.
Currently I have very little debt. My house and car I paid off 3 years ago. I like the idea that my investments will be safe.
 
Gaz{M} said:
Make sure you put R30 000 a year into tax free investment account invested in ETFs.

Then the rest in high equity ETFs or unit trusts or shares directly.

Remember that you can sell shares and unit trusts in a couple of days and have the money, so it isn't tied up if you need R100k urgently. So probably invest all R600k then. No need to keep R100k liquid.
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... Really? So what happens when the index is taking a beating like now, and you urgently need cash? You sell at the lower value and take a big loss?
 
I would keep R50-100k in cash, with the remainder in ETFs. Due to the current market conditions, I would "phase" into the market, i.e. spread the ETF purchases out over 12 to 18 months.

I recommend doing the purchases through a stockbroker and not Satrix or ETFsa, due to the amount of money you investing.

A buy-to-let property will probably not be the best idea, you will end up with lots of admin, and I dont think the after tax return would be better than listed property.
 
The only money you should be putting into ETFs is money that you won't need for a long time (5+ years ...more).

Some of the guys mentioned offshore - I cannot comment on that but it sounds like something worth exploring.

Personally I would go see a financial advisor (mind the costs). Put some of it in lower risk balanced funds that you can have access to in seven days or keep it completely liquid (think three month's salary) and the rest into more aggressive equity funds.

If I was to self manage the rest I would look at maxing out my RA for the year and get the tax benefit and pushing the rest into ETFs like DBXWD and STXIND that has historically shown great growth (although that ride might be over for now). This is assuming I won't need that money till retirement/long time from now.

The way things are going now on the markets it might be better to just put all that cash in a fixed deposit and hope pray inflation doesn't go over 9% in the next 5 years :D :cry:
 
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