A Fin24 user is not sure whether he should leave R300 000 in an account or expose it to the market with the chance of getting a better yield. He writes:
I am 62 years old and have been retired for the past two years.
One of my concerns is whether I have too much market exposure.
I have a pension fund which pays me R16 000 per month after tax and medical aid have been deducted.
We are currently able to live from this and have some money left to save.
I also have a living annuity of R1.4m. The draw down including tax is R6 100. This we have saved and not spent.
I have a Sanlam Cumulus Endowement of five years for R480 000. It matures when I am 65. It is mostly equities with protection.
We also have R150 000.00 in an FNB Flexi Fix for holidays and emergencies. This grows by R8 500 a month presently.
I also have a small retirement annuity of R138 000 which I have reinvested until I am 69 years old.
I have a further R300 000 in Flexifix, which is part of our long term savings, but only yields 5.35%.
This is where my issue lies. Do I leave this money where it is or expose it to the markets as well? If yes, what sort of funds should I expose it to?
We are completely debt-free and I have my title deeds. We do have an adviser, but would like a second opinion.
Daryl Ducasse, an investment manager at Merkurius Capital Solutions, responds:
The questions below are really for a financial planner or adviser. We are investment risk analysts, and investment managers.
We do not deal with any form of retirement planning, endowments or unit trusts or pension planning.
What we do is understand the risk in a potential investment, and structure transactions in such a manner so as to get the best possible level of risk mitigation out of the deal for the client, while being mindful of the desired returns.
The questions below indicate to me that you have given careful consideration to performance.
This being the case, I would put the FlexiFix R300 000 into a more aggressive fund managed by, for instance, Coronation, Allan Gray, Sanlam, etc. This is not advice, just an opinion.
It is very clear that you have little to no risk in terms of your retirement living standards, with no debt and ownership of your property as well as a reliable income to sustain yourselves.
The ratio of the R300 000 to your overall asset basket is, therefore, nominal.
- Fin24
Do you have a pressing financial question? Post it on our Money Clinic section and we will get an expert to answer your query.
Disclaimer: Fin24 cannot be held liable for any investment decisions made based on the advice given by independent financial service providers.
Under the ECT Act and to the fullest extent possible under the applicable law, Fin24 disclaims all responsibility or liability for any damages whatsoever resulting from the use of this site in any manner.
I am 62 years old and have been retired for the past two years.
One of my concerns is whether I have too much market exposure.
I have a pension fund which pays me R16 000 per month after tax and medical aid have been deducted.
We are currently able to live from this and have some money left to save.
I also have a living annuity of R1.4m. The draw down including tax is R6 100. This we have saved and not spent.
I have a Sanlam Cumulus Endowement of five years for R480 000. It matures when I am 65. It is mostly equities with protection.
We also have R150 000.00 in an FNB Flexi Fix for holidays and emergencies. This grows by R8 500 a month presently.
I also have a small retirement annuity of R138 000 which I have reinvested until I am 69 years old.
I have a further R300 000 in Flexifix, which is part of our long term savings, but only yields 5.35%.
This is where my issue lies. Do I leave this money where it is or expose it to the markets as well? If yes, what sort of funds should I expose it to?
We are completely debt-free and I have my title deeds. We do have an adviser, but would like a second opinion.
Daryl Ducasse, an investment manager at Merkurius Capital Solutions, responds:
The questions below are really for a financial planner or adviser. We are investment risk analysts, and investment managers.
We do not deal with any form of retirement planning, endowments or unit trusts or pension planning.
What we do is understand the risk in a potential investment, and structure transactions in such a manner so as to get the best possible level of risk mitigation out of the deal for the client, while being mindful of the desired returns.
The questions below indicate to me that you have given careful consideration to performance.
This being the case, I would put the FlexiFix R300 000 into a more aggressive fund managed by, for instance, Coronation, Allan Gray, Sanlam, etc. This is not advice, just an opinion.
It is very clear that you have little to no risk in terms of your retirement living standards, with no debt and ownership of your property as well as a reliable income to sustain yourselves.
The ratio of the R300 000 to your overall asset basket is, therefore, nominal.
- Fin24
Do you have a pressing financial question? Post it on our Money Clinic section and we will get an expert to answer your query.
Disclaimer: Fin24 cannot be held liable for any investment decisions made based on the advice given by independent financial service providers.
Under the ECT Act and to the fullest extent possible under the applicable law, Fin24 disclaims all responsibility or liability for any damages whatsoever resulting from the use of this site in any manner.