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Occasionally, when the thought of Financial Planning comes up, we regard it as something for those who are close to retirement or for those who are in different circumstances to our own, but in reality, Financial Planning is for everyone. Standard Bank has dedicated years of service excellence in aiding people with this, regardless of their stage in life or situation. Let us show you the possibilities, as you become your very own success story.
Mr. Jaffa was a 24-year-old male who had just finished his studies at a leading university and had just begun as an intern in a law firm. After intensive discussions with his financial advisor, it was suggested that he contribute towards a high-risk (Equity) portfolio, as he was not averse to taking a chance and had the extra money available as he had already addressed his other financial needs. He understood that time IN the market was far more important than trying to time the market, and was prepared for long-term investing in this saving vehicle.
Initially he started with a debit order of R120 to be safe, but realised shortly after that he could afford a little more and increased the debit order to R144 per month and also elected to have his distributions reinvested. In 2000, he decided to go on holiday and used R3000 of his collective investment schemes portfolio money. He diligently continued to pay his monthly debit order, and also wisely increased it by 20% every year after.
In 2008, he got married and needed some money to purchase the engagement ring, as well as pay for other essential items that was needed for the wedding. He made three withdrawals in total: The first was for R50 000; the second was for R10 000; and the third for R15 000. After discussions with his financial advisor, he decided to redeem the remaining funds from his account, which was a total of R24 422. 24, and use it as a deposit towards a new car.
Mrs. Smith was 26 years old and residing in Pretoria at the time of inheriting a lump sum of R 150 000 from one of her parents in 2007. After extensive consultation with her financial advisor, and determining her long and short-term financial goals, she was advised to make use of the Classic Investment Plan, which allowed her to select 4 funds for her portfolio.
Her requirements were broken down to a need for an amount every month (cash flow); non-taxable dividends when in the investor’s hands; capital growth; and the benefit of having immediate access to the capital. The Classic Investment Plan answered to her needs, was the most cost-efficient investment product while not comprising on exposure to equity, bond and property markets. She diversified her portfolio even further by making use of a “phase-in” option, where her investment was phased into her portfolio from a money market account, thereby benefiting from rand cost averaging and also took the risk out of timing the market poorly.
Although Mrs. Smith receives a monthly income from her investments, after 3 years her investments were worth just over R 144 000, which she then decided to withdraw to put down as a deposit on a new house.