Your investment questions answered

PSG answers investment questions. Picture: Independent Media.

PSG answers investment questions. Picture: Independent Media.

Published Nov 30, 2023


I’m currently separating from my husband, and unfortunately, he was the one who managed our finances and planned our investments. Due to this, I’m needing to start over and would like some advice on what to focus on to build on my savings. Name withheld

Jaanre Muller - Wealth Manager, PSG Wealth, Hermanus answers:

The first step is to determine what you’re saving for. Having a clear goal allows you to map out your financial plan, which involves some key considerations such as how much to save to reach that specific goal.

Your plan should also consider the relevance of the various financial products that apply to you, such as retirement annuities, discretionary investment plans or endowments. Each of these products has a specific set of characteristics and a good understanding of it can help you to maximise its benefits. I would advise speaking to a financial adviser to assist you in choosing the right route for you.

Risk tolerance is another key aspect to consider in your financial plan. You should not only evaluate how much risk you can afford from a financial perspective but also how much risk you personally feel comfortable with. There are two important risk factors to consider when investing:

Firstly, in your case where you’re starting off fresh, make sure you focus on quality – this applies to the underlying service provider, investment or asset. There are many pitfalls when you decide to take unnecessary investment risks. Successful investing takes time and will require patience from time to time. If an investment prospect sounds too good to be true, it most probably is.

The second is to diversify your investment portfolio. A properly diversified portfolio is essential in managing risk effectively.

In summary - create a clear goal and put together a financial plan by seeking appropriate guidance and remembering to stay on course. This will allow you to build your investment and savings on a strong foundation.

My partner and I share financial responsibilities and are both very secure in growing each of our financial portfolios separately. I am still young and want to grow my investment portfolio. Do you have any tips to consider? Name withheld

Suzette von Broembsen, Wealth Adviser, PSG Wealth, Rosebank answers:

The impact on investment behaviour when one feels financially secure offers you confidence, increases the ability to take risks because you have a buffer if things don’t work out, and offers an opportunity to understand that success happens over time. So, make use of this time in your lives to build a secure foundation for a financially free future.

Below are some tips for you to consider:

  1. Be tax-smart: Opt for tax-efficient investment options like endowments, Retirement Annuities, and capital gain investments as opposed to interest-earning investments, which could be taxed at a higher rate.
  2. Utilise tax-free investments: Take advantage of monthly debit orders into a tax-free investment, supplementing your income with no tax implications.
  3. Save a substantial portion of bonuses: Save 50% to 70% of your bonus in long-term investments and treat yourself with the remaining portion.
  4. Create a budget: Take an active role in managing your finances by having a well-planned budget. This role does not solely remain with your spouse, if we wish to be rewarded equally in the corporate world, we need to take on the responsibilities for finances at home as well.
  5. Automate monthly savings: Set up automatic debits for investments to ensure disciplined savings. It ensures the money is invested without you consciously thinking of it, which mostly results in a positive experience over the long term.
  6. Invest in higher-yielding assets: Consider long-term growth investments to counter the impact of inflation.

While these guidelines offer valuable advice, remember that each of you has a unique situation. Consulting a financial advisor can help you make informed decisions and avoid costly mistakes.

My partner has asked that I move in with him, and this means that we will be joining our finances which is scary and exciting all at once. I’d like to remain financially independent while still building on our life together. Do you have any advice on how best to manage this to avoid any hiccups for us along the way? Name withheld

Dulcie Weyks, Financial Adviser, PSG Wealth, Waterkloof answers:

Finding the right balance between relationships and money can be tricky. There’s an apt quote that says, “A healthy relationship is one where two independent people just make a deal that they will help make the other person the best version of themselves”. This can very easily be applied to the context of financial goals and managing your personal and joint finances as a couple.

I always advise people to empower themselves and aim to remain financially independent, even when they enter a certain phase of a relationship such as moving in together or getting married. This sort of independence allows you to pay for your own living expenses with your own income, without having to be depending on the other person.

So many couples avoid talking about finances which often leads to conflict, and in some cases, ends the relationship. Have an open and honest discussion with your partner about your finances, whatever circumstances you may find yourself in. Keep in mind that habits and attitudes towards money could differ, depending on the individual’s childhood. Questions to prompt this conversation could be: Do you want a travel fund? Do you want to own property in 3, 5 or 10 years? What age do you want to retire?

Once you have an understanding of how your partner approaches their money management, it can help to determine the best way to manage the joint financial goals. These goals will give you something concrete to work towards as a couple and will help you decide how much money you both need to save and where that money is best invested.

Tackling your finances as a couple can help you to avoid fights about money, and you can assist each other in reaching common goals. A qualified financial adviser can help you to build a financial plan that works for you, so you can feel confident that you’re on the right track.

I’ve just started my own business and although I’m very excited, I’m acutely aware that I’m starting out in a period of uncertainty and instability. My main goal as a new businesswoman is to ensure that my business operates optimally and to ensure that I protect it against unnecessary risks. I know business insurance would help me do this, but I’m not sure where to start – can you help? Name withheld

Elmarie Strauss, PSG Insure Adviser answers:

Congratulations on becoming a business owner, that is a huge feat! While it can be overwhelming at times, and you may feel like you have to do so many things alone, that doesn’t need to be the case. An insurance adviser can help to ensure you plan to protect your business from the start. They can assist with a business risk assessment which will assist in identifying the potential risk and the impact it could have on you and your business. They are also best placed to help you pick the right kind of insurance, that will assist in protecting your bottom line and also to protect your business’s financial position should you be faced with a loss. Advisers know that every business is unique and are there to help, so I’d recommend you connect with one as your immediate next step.