Over the past decade, many South Africans have fallen into the trap of increasing consumption at the expense of savings, and accumulating debt in the process. What is needed is a return to basic investment principles.

Between 1995 and 2007, the gross level of savings in South Africa, measured as the proportion of household revenue that is not spent, dropped from almost 4.5% to under 2%. This worked while money was cheap and asset prices were rising, but unfortunately the tide has now gone out and many people have been left exposed.

The average South African needs to accumulate capital via a regular stream of investment contributions over time. The good news is that these investors have two basic investment principles working for them- time in the market and buying through the dip.

It’s time in the market that counts. No matter what the dream or goal, the sooner a person starts saving for it, the better. It is a fact based on the principle of compound interest, which basically means that interest is earned upon interest already earned, so that the effect is a dramatic snowballing of the money invested and the interest realized.

This effect only works over a long period- the longer the better. Which is why starting earlier with less can be so much more effective than starting later with more.

To prolong your retirement planning is foolish, because you increase the risk of not having sufficient monthly surplus at a later stage to reach your goal. So even if you start small at an early age, every bit counts and makes it that much easier later on in life. Get into the habit of setting at least 10% aside for retirement from the day you start work. Build it in as a non-negotiable expense like tax; the rewards will be worth it.

If you have never had a financial plan prepared for you, please go to the “contact us” section on the website and fill in your details, and we will contact you to explain the process.

Our Value proposition is the ability to provide a holistic financial plan for you, taking into consideration your personal and financial goals and objectives. We believe in the building of long-term relationships, with yourself, your family and any of the other professional advisors who may be servicing you.

Our Financial planning process consists of the following:

• Identification of your financial goals and objectives.
• Collection of relevant information.
• Analysis of your current financial situation.
• Development of a full financial plan, together with options and recommendations
• Implementation of agreed recommendations
• A regular review of the financial plan either bi-annually, annually or as the circumstances require.