Investment advice

[supersunbird]

Thanks Sunbird

Was also looking at the fnb global accounts, maybe convert to USD and GBP before the the zar/usd hits 30/1 :O but gonna lose alot and there is no real interest on these accounts + paperwork is a bitch and the eventual "repatriation of funds" is sure to involve some hectic fees.

Me thinks I'll just dump it all in the coronation for 5 years and pray

/Thread un-hijack

Soz OP

You can also but some into the rand denominated international fund coronation has if that is something you are interested in, and if you have enough moola built up, you can even put it straight into one of the $ denominated international funds.

 

[xplora]

@ Hamster ... btw. it was a yoga instructor who got me into the Liberty scheme ;-)
Contacted Liberty and waiting for an answer from them re. penalties payable ...

 

[Goliath]

Sitting with same investment problem with my father, he is 66 and received pension of around R1mil, we placed it in Capitec account for now.. I'm young and can do stocks but for him what will be best option guaranteeing his capital while making better returns than keeping it in the bank, shares not a option..

 

[xplora]

I wad advised by my sister to wait until maturity date, then look at other options available through her Fin. Advisor.
Thanks for all your expert advice ... it really opened my eyes to the other possibilities yes.

 

[supersunbird]

Sitting with same investment problem with my father, he is 66 and received pension of around R1mil, we placed it in Capitec account for now.. I'm young and can do stocks but for him what will be best option guaranteeing his capital while making better returns than keeping it in the bank, shares not a option..

One still needs exposure to shares, albeit a very small component compared to the building phase, or one will loose to inflation over the long term, thus one also has to take account of how ones current health is.

I'll expand on the issues later, got family logistics to sort out today.

 

[vash87]

Sitting with same investment problem with my father, he is 66 and received pension of around R1mil, we placed it in Capitec account for now.. I'm young and can do stocks but for him what will be best option guaranteeing his capital while making better returns than keeping it in the bank, shares not a option..

You could go the unit trust route to take advantage of a range of diversified portfolios. The portfolios are actively managed so he won't have the stress of making stock picking choices etc. Asset allocation varies amoung portfolios so you could for example, choose one conservative money market/bond denominated portfolio for stable growth and regular withdrawals, then another portfolio with a long term outlook - exposure to the more aggressive asset classes such as equities (shares) and property. You should also probably throw a small lump sum in an offshore fund.

It can be hard to determine exactly what proportions to invest in which asset classes, and the market timing can also make a huge difference when investing lump sums. I recommend speaking to an adviser and explaining your dad's situation to him in detail as well as what your dad's income goals are.

 

[vash87]

I also made the mistake of investing in liberty's exelcior investment builder, in the property portfolio, back in 2010. Didn't understand anything back then (made it my mission to wise up since then) , thought that since it was done through my FA all is fine. Term was for 5 years. Getting 2.8 % return on investment right now, after fees and taxes. Fortunately, only R1000 pm so not such a costly mistake. Phew.

Completely agree with hendrix, don't mix insurance and investments.

The problem here is that everything is invested in property, so there is no diversification. Around a year ago at this time, listed property portfolios were showing over 40% growth in one year - since then the market has corrected, similar to what we're seeing in equity markets over the previous two weeks.

There are two excelsior property portfolios. The listed property portfolio is much better suited to a long term investment like yours. However you might still like to diversify further to reduce risk.

http://www.liberty.co.za/fund-perfo...448-20131130-excelsior-property-portfolio.pdf

http://www.liberty.co.za/fund-perfo...sior-and-evolve-listed-property-portfolio.pdf

A well invested endowment fund can be a superior performing for individuals with high tax rates that are already maxing out their annual interest income exemption. There is also no CGT in the owners hands.

 

[BloodBurner9000]

Thanks, vash.

What you have said now should have been made clear to me back then, it wasn't. I. E, the tax advantages and when they will be applicable. In addition, that product forces the policyholder to save as there will be penalties if he does not.

My gripe is with the FA recommending a product which was not in the best interest of me (completely ignoring market returns) and appropriate to someone else with a different tax profile, definitely not appropriate to the term I am investing in, and then with the fee structure eating into a low (yet stable) yielding investment so that you sit with negative real return after 5 years. That is incredible.

Edit,
Completely ignoring market returns i mean, without looking at market returns it was clear that an endowment policy was not for me

 

[Hamster]

@ Hamster ... btw. it was a yoga instructor who got me into the Liberty scheme ;-)
Contacted Liberty and waiting for an answer from them re. penalties payable ...