Offshore investments

South Africans looking for tax-efficient retirement planning solutions have an array of offshore investment options available to them – but it’s important to choose the right investment vehicles, and to choose reputable financial advisors.

That was the key message from Sovereign Trust SA’s fifth annual International Retirement Seminar, held recently.

Joanne Baynham, head of investment strategy at MitonOptimal SA, believes the table is set for the return of inflation, although still not runaway, and a measure of tightening that will cause volatility and equity market weakness. Worrying for SA investors, she believes that technically, the US dollar could get stronger.

Several other speakers highlighted the importance of offshore investing as a hedge against the volatile rand, with South Africa’s declining currency offering little in the way of a protected future lifestyle. Thanks to relaxed foreign exchange control legislation in recent years, South African investors should look to use the SA Reserve Bank’s R10 million foreign investment allowance to diversify more freely into other markets, currencies and opportunities, and thus to hedge against currency risk and secure more stable retirement funding.