Re­tire­ment: save 20% of your salary

Seef Umh­langa un­der new own­er­ship All you need to know about credit agree­ments

Weekend Witness - - Money -

SE­EFF Umh­langa is now un­der the own­er­ship of lo­cal part­ners Gary Wentzel (prin­ci­pal) and Neil Butcher (di­rec­tor).

Their vi­sion for the branch is to in­crease mar­ket share by at­tract­ing se­ri­ous sell­ers who want to sell at the right price.

Wentzel says: “Se­eff Umh­langa is cur­rently the top-sell­ing of­fice within Se­eff KwaZulu-Natal — and the open­ing of King Shaka Air­port just 10 min­utes away (al­though flight path con­fig­u­ra­tion means we have lit­tle to no air­craft noise) is set to be a great new ad­van­tage to lo­cals — and for prop­erty growth in Umh­langa.”

Wentzel is a high-pro­file prop­erty pro­fes­sional who has worked at se­nior na­tional level for a num­ber of well-known brands over the past 16 years. He is a reg­is­tered prin­ci­pal with the Es­tate Agents Af­fairs Board and holds a num­ber of qualifications in real es­tate.

Wentzel says both houses and apart­ments in Umh­langa that are priced be­tween R2,5 mil­lion and R5,5 mil­lion are at­tract­ing se­ri­ous of­fers right now.

“In May the price of real es­tate in­creased again, by a weighted 15,2% ac­cord­ing to Absa. Ac­tiv­ity lev­els are def­i­nitely pick­ing up in Umh­langa — buy­ers are start­ing to put pen to paper, more are at­tend­ing show days, and we are get­ting more in­quiries through the web and other lo­cal and in­ter­na­tional chan­nels. We feel very pos­i­tive about 2010.”

His part­ner and di­rec­tor of Se­eff Umh­langa, Neil Butcher, was in­volved in the IT busi­ness for over 20 years, and is a found­ing di­rec­tor of Di­men­sion Data, one of South Africa’s lead­ing IT com­pa­nies. He has served on the boards of sev­eral com­pa­nies as well as as an ad­vi­sor to com­mu­nity-based projects. — WW Re­porter. THERE is a be­lief that if you save 10% of your salary each month, ei­ther di­rectly or through a com­pany pen­sion plan, you will be able to re­tire. This is in fact very wide off the mark, with or­di­nary South Africans need­ing to save at least 20% of their monthly salary to en­sure a qual­ity re­tire­ment.

Many South Africans’ re­tire­ment sav­ings are in fact hope­lessly in­ad­e­quate, said Rian le Roux, chief econ­o­mist at Old Mu­tual In­vest­ment Group South Africa (Omigsa).

To il­lus­trate this point, Le Roux uses an ad­mit­tedly un­re­al­is­tic ex­am­ple of an en­vi­ron­ment of zero in­fla­tion, zero in­ter­est rates and zero in­vest­ment re­turns.

“Say you want to re­tire af­ter 35 years of work (at age 60) on 75% of your salary, and it must last 25 years (un­til you die at 85). How much of your in­come must you save over 35 years to be able to live on 75% of that in­come for a fur­ther 25 years? The an­swer is 54%.”

He adds that if you only work 30 years and need 75% of in­come for a fur­ther 30 years (you die at 85), the per­cent­age you need to save goes up to 75%.

“In this sim­pli­fied world, it means that if you save say 20% of your monthly in­come over 35 years, you will only have 28% of the in­come dur­ing your work­ing years as a pen­sion. In the sec­ond ex­am­ple, the per­cent­age goes down to 20%,” Le Roux said.

Put dif­fer­ently, un­less you get pretty high re­turns on your in­vest­ments dur­ing your work­ing life, you will have to save a pretty high per­cent­age of your in­come to re­tire com­fort­ably. In a nor­mal world of in­fla­tion and pos­i­tive in­vest­ment re­turns, the fo­cus must be on get­ting high real re­turns on your in­vest­ments.

War­ren In­gram from Galileo Cap­i­tal con­curred, say­ing that if you are depend­ing on the 10% sav­ings rule you would end up well short, par­tic­u­larly if that 10% is sim­ply through a de­fen­sive pen­sion fund with your com­pany. You need to put away nearer to 20% per month, he said.

Old Mu­tual re­cently launched its Sav­ings Monitor for South Africa, which showed that half of South African house­holds are sav­ing less this year.

Some 19% of house­holds are sav­ing for a de­posit to buy a house, 31% are sav­ing for their chil­dren’s and their own ed­uca- tion, while 15% are sav­ing to pay off debt. The data also showed that about 22% of house­holds are sav­ing to buy a car.

For Gen­er­a­tion Y (peo­ple born af­ter 1980) sav­ing is a low pri­or­ity with the ma­jor­ity say­ing that they need debt to fuel their ma­te­rial life­style.

Only seven per­cent of South Africans are sav­ing to start their own busi­ness, the sur­vey shows. This is in­ter­est­ing as Absa Wealth act­ing CEO Carl Rooth­man pointed out to Fin24 that many of its high net worth in­di­vid­u­als had madea­great deal of wealth through start­ing and sell­ing their own­busi­nesses.

How­ever, in­vest­ing in your own busi­ness then means that you may not have suf­fi­cient ex­tra cash on hand in the early years to make­more­tra­di­tional in­vest­ments in re­tire­ment and sav­ings ve­hi­cles.

Le Roux con­cluded: “Un­der­stand the risk of your busi­ness and do not fully rely on the busi­ness as a nest egg. That’s the same as putting all your eggs in one bas­ket — typ­i­cally a stupid idea.”

— Fin24. THE Credit In­for­ma­tion Om­bud’s (CIO) of­fice ef­fec­tively re­solves dis­putes be­tween mem­ber­sof the credit in­dus­try (credit providers, credit re­ceivers and credit bureaux). Writ­ten credit agree­ments/con­tracts play an im­por­tant role when the of­fice makes de­ci­sions in re­solv­ing dis­putes.

Caro­line Buthelezi, PROsays: “For us to as­sist in re­solv­ing dis­putes ef­fec­tively, it is very im­por­tant that credit re­ceivers sup­ply us with as much in­for­ma­tion as pos­si­ble. In ad­di­tion, sup­ply­ing us with proof of facts is im­por­tant be­cause ver­bal agree­ments are al­ways very dif­fi­cult to prove.”

She pro­vides a brief over­view to give con­sumers a bet­ter un­der­stand­ing of credit agree­ments/con­tracts.



It is an agree­ment be­tween a buyer and a seller whereby goods are sold or ser­vices are ren­dered in re­turn for money to be paid in the fu­ture over a spe­cific pe­riod of time. This in­cludes loans and other forms of credit from banks.

All credit agree­ments must be: • in writ­ing; • read and un­der­stood be­fore be­ing signed; • com­pleted be­fore you sign it; • signed by all, both credit provider (rep­re­sen­ta­tive) and credit re­ceiver; and • credit agree­ments must state the de­scrip­tion of the goods sold. If it is a loan, the amount of money you bor­rowed, rate of in­ter­est and fi­nance charges payable, monthly in­stal­ment and pe­riod, etc. must be stated.

The credit provider in a credit agree­ment is called a cred­i­tor and the credit re­ceiver is called a debtor.

It is im­por­tant to read and un­der­stand the con­tents of the con­tract be­fore sign­ing it. If for some rea­son you have to sign a sec­ond con­tract, do not as­sume that its con­tents are sim­i­lar to the first one. Treat it as a new con­tract, and read and un­der­stand its con­tents be­fore sign­ing it.



Do not sign it. Con­sult the credit provider (rep­re­sen­ta­tive) for clar­ity. The Na­tional Credit Act makes pro­vi­sion for credit re­ceivers to request con­tracts to be drawn up in a lan­guage which credit re­ceivers un­der­stand. Fur­ther­more, the act makes pro­vi­sions for a five work­ing­day quote to be pro­vided on request by the credit ap­pli­cant. This gives the credit ap­pli­cant am­ple time to read and un­der­stand all as­pects of the agree­ment.


• ver­bal agree­ments are very dif­fi­cult to prove; • for fu­ture ref­er­ence, should a dis­pute arise later, af­ter the con­tract has been signed; and • for you to know the terms and con­di­tions of the agree­ment be­fore you com­mit your­self.


For clar­ity, request all sup­port­ive doc­u­men­ta­tion from him or her (ver­bally and in writ­ing). This is be­cause credit providers some­times use third par­ties, attorneys and debt col­lec­tors to col­lect debt on their be­half. Credit providers some­times sell their book debt to third par­ties.

If you do not know any­thing about that credit agree­ment/con­tract: • in­form that or­gan­i­sa­tion or per­son im­me­di­ately that you do not know any­thing about that con­tract (ver­bally and in writ­ing – fax, e-mail, etc.); • sup­ply him or her with your con­tact de­tails, this is for them to con­tact you should they need ad­di­tional in­for­ma­tion to fi­nalise their in­ves­ti­ga­tions; • keep proof that you no­ti­fied him or her of your dis­pute, such as a fax trans­mis­sion; • request writ­ten con­fir­ma­tion that your mes­sage has been re­ceived; and • if they agree that you did not sign that con­tract, this should be con­firmed in writ­ing.

The CIO can be reached on 0861 66 2837 or visit www.cred­it­o­

— Week­end Wit­ness Re­porter.


Neil Butcher (left) is the new di­rec­tor of Se­eff Umh­langa and Gary Wentzel is the prin­ci­pal.

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