RE­TIRE­MENT

Finweek English Edition - - MONEY -

In or­der for Can­di­date B to achieve her goal of re­ceiv­ing R20 000 per month af­ter tax in real terms, she would need to achieve a real re­turn of 6% per an­num pre-re­tire­ment a real re­turn of 4% per an­num postre­tire­ment.

At the mo­ment she con­trib­utes ap­prox­i­mately R3 000 per month to­ward the com­pany re­tire­ment f und and she is a mem­ber of a re­tire­ment an­nu­ity and con­trib­utes R1 380 per month. The port­fo­lio would con­tinue un­til she reaches age 77.

Can­di­date B was ad­vised to in­crease her monthly sav­ings by at least R2 000 per month. This would mean that the port­fo­lio would then con­tinue un­til she is 82 years old. It was sug­gested that Can­di­date B in­vest th­ese funds in a f lex­i­ble unit trust op­tion as she has al­ready used up her re­tire­ment an­nu­ity ca­pac­ity.

A bud­get ex­er­cise was done, which demon­strated that al­though not easy, it was pos­si­ble to save an ad­di­tional R2 000 per month by mak­ing small sac­ri­fices. Th­ese

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