annum, you should have the required R6 300 per month after 10 years, and at a more tax-favourable rate (15% dividend tax vs. income tax rates).
Looking at t he JSE’s All Share Index (Alsi), you will see that dividend payments over the past 50 years showed much less f luctuation than the share prices themselves, proving that you should focus on the long-term ability of the company to generate income, rather than short-term price f luctuation. VALUATION TOOL We have heard experts tell us the market is currently expensive. A number of reports and recommendations over the past year refer to the current average historical Price/Earnings (PE) ratio of 17.5 as an “extreme level” (see bottom left graph), and they may even be right over the short term.
But compare the income from shares (dividend yield) relative to the money market: if you take a closer look at this ratio (see bottom right graph) you will 20 18