2020 amm invite 600
Benchtest Newsletter
Issued March 2023
 
 
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In this newsletter

Benchtest 02.2023 –  additional voluntary contributions, changes to FIMA standards, Trust Moneys Protection Act and more...

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Important notes & reminders

    
NAMFISA levies
  • Funds with March 2023 year-ends must submit their 2nd levy returns and payments by 25 April 2023;
  • Funds with September 2023 year-ends must submit their 1st levy returns and payments by 25 April 2023;
  • and funds with April 2022 year-ends must submit their final levy returns and payments by 28 April 2023.
No more employer tax recons

Employers who submit their monthly remuneration details on ITAS are no longer required to submit annual tax recons. See the announcement, here…

Registered service providers

Certain pension fund service providers must register with NAMFISA and report to NAMFISA. Download a list of service providers registered as of June 2022, here...
Retirement calculator

Use our web-based retirement and risk shortfall calculator for your personal retirement planning. Find it here...

If you need help with your financial planning, get in touch with
  • Annemarie Nel (tel 061-446 073)
  • Christina Linge (061-446 6075)
Toolbox for trustees

RFS provides comprehensive support for trustees. Find a list of download documents to assist with governance and management of private funds, registered as of June 2022, here...
 

 

Newsletter

In this newsletter, we address the following topics:
In 'Tilman Friedrich's industry forum' we present...
  • Monthly review of portfolio performance – 28 February 2023
  • When conventional investment management becomes redundant
  • Additional voluntary contributions and tax revisited
  • FIMA bits and bites – the latest changes to subordinate legislation 
In Compliments, read...
  • A compliment from a fund member and former principal officer of various funds
In ‘Benchmark: a note from Günter Pfeifer’, read about…
  • Important circulars issued by the fund
In 'News from RFS', read about...
  • Long service awards complement our business philosophy
  • RFS staff social function at Monteiro
  • Annemarie Nel earns Ruby Quality Award
  • Important circulars issued by RFS
In 'News from NAMFISA', read about...
  • More time given to comment on standards and regulations
In 'Legal snippets,' read about...
  • A review of the Trustee Moneys Protection Act
  • New definition of Remuneration for VET levy purposes
In 'Snippets for the pension funds industry,' read about...
  • Seven worst mistakes for retirement planning
  • Living annuities as an option for retirement income
In ‘Snippets of general interest', read about...
  • What the law says about selling a house with defects in South Africa
  • Securing your child’s financial future
And make a point of reading what our clients say about us in the ‘Compliments’ section. It should give you a good appreciation of who and what we are!

As always, your comment is welcome, so open a new mail and drop us a note!

Regards

Tilman Friedrich
 
Tilman Friedrich's industry forum
 
 
Monthly Review of Portfolio Performance
to 28 February 2023

In February 2023, the average prudential balanced portfolio returned 0.2% (January 2023: 5.5%). The top performer is Allan Gray Balanced Fund with 1.0%, while NinetyOne Managed Fund with -0.7% takes the bottom spot. For the three months, Namibia Coronation Balanced Plus Fund takes the top spot, outperforming the 'average' by roughly 2.6%. Hangala Capital Absolute Balanced Fund underperformed the 'average' by 2.1% on the other end of the scale. Note that these returns are before (gross of) asset management fees.

The Monthly Review of Portfolio Performance to 28 February 2023 provides a full review of portfolio performances and other insightful analyses.  Download it here...
 
When conventional investment management becomes redundant
 
In the phase to the final resolution of the East-West conflict, one way or another, inflation and interest rates are likely to be much higher. Governments may have to raise taxes to fund the conflict and higher interest rates on their debt. Higher interest rates, inflation, and taxes will curb consumer demand and will result in a recession over the next decade until the dust settles. There will be a decoupling of global equity markets, and local equity markets will be driven by local and regional rather than global developments. Because of the global political turmoil, foreign investors will withdraw from the local markets for ‘safe havens’. Investors’ definition of ‘safe havens’ will change as investors are likely to onshore or friend-shore their investments even further than they started to do in the aftermath of COVID and global supply change disruptions. Foreigners’ support of local equities and other assets will dwindle, impacting our local currency and equity markets negatively. Should the worst-case scenario realise, equity markets will take a deep dive and will not recover before the situation has been resolved, one way or another. Economies will not disappear unless their people disappear. As long as there are people, they have needs that the economy must meet, and life will continue. Today’s winners may not be tomorrow’s, but basic life necessities will always exist. Markets will undergo significant changes, and with it will come a lot of volatility…
 

The Monthly Review of Portfolio Performance to 28 February 2023 also reflects the editor’s views on current developments and their impact on investment markets. Download it here...
 
Additional voluntary contributions and tax revisited

Section 17(2) of the Income Tax Act was amended as of 29 December 2022 to allow a member to contribute to a retirement fund and other similar savings arrangements and deduct from income tax up to N$ 150,000 per year.
 
Our position, which also relied on that of tax experts, was that voluntary contributions are not tax deductible. Our position was based on section 17(1)(n)(i), which states “For the purpose of determining the taxable income derived by any person from carrying on any trade within Namibia, there shall be allowed as deductions from the income of such person so derived –
  • (i) subject to subsection (2) any sum contributed during the year of assessment¹ by way of current contributions² to any pension fund or provident fund by any person holding an office or employment³ where the making of such a contribution is a condition of holding of such office or employment⁴.” 
I have underlined the four critical requirements to be met in order to deduct the contributions to a pension or provident fund. These are:
  1. only contributions paid during the current tax year;
  2. only contributions for the current tax year (i.e. not the previous or the following tax year);
  3. only if the taxpayer is a salaried employee;
  4. only if the employee’s employment contract obliges him to make the contributions. 
Therefore, if it is up to the employee whether or not to contribute and his employment contract does not make it a requirement, condition 4 is not met. Consequently, the generally accepted understanding was that voluntary contributions are not tax deductible.
 
In a ruling recently issued to a retirement fund, the request for the ruling clearly stated that the fund’s rules require members to contribute at a specified percentage of salary (in other words, the employee is obliged to make the contribution) and to make additional voluntary contributions. NamRA’s ruling authorises members of the fund to deduct additional voluntary contributions from their taxable income.
 
A tax ruling is only applicable to the person to whom it was issued. Other funds cannot rely on this ruling. We, therefore, advise any employer whose employees want to use the increased tax deductible contribution by making an additional voluntary contribution, to consider obtaining a ruling for their fund. It remains a risk to make additional voluntary contributions without a ruling. The fund could lose its tax approval, and the taxpayer could face penalties and interest on any disallowed additional voluntary contributions.

 
FIMA bits and bites – the latest changes to subordinate legislation

Contributed by Carmen Diehl
Senior Manager: Fund Accounting and Compliance

 
Background and status of FIMA subordinate legislation:
 
NAMFISA invited its regulated industry impacted by the implementation of the Financial Institutions and Markets Act No 2 of 2021 (‘FIMA’) (‘Industry’) to comment on FIMA subordinate legislation by issuing the following public notices:
  • Public notice on 23/11/2021 with submission of comments due on 28/02/2022 (standards were subsequently gazetted in Government Gazette #7713 – GENERAL NOTICE NO. 737 dated 22 December 2021)
  • Public notice on 19/04/2022 with submission of comments due on 20/06/2022 (Government Gazette #7784 – GENERAL NOTICE NO. 163 dated 11 April 2022) 
NAMFISA issued a public notice on 25/11/2022 informing Industry that:
  • the consideration of Industry representations and comments as part of the formal consultation process on the FIMA subordinate legislation Phase 1 to 3 has now been finalized;
  • NAMFISA issued a document with NAMFISA responses on Industry representations and comments; and
  • NAMFISA uploaded the revised standards and regulations incorporating NAMFISA responses on Industry representations on the NAMFISA website. 
The following standards were republished in Government Gazette # 8026 due to the extensive changes to the standards (with Industry comments due by 8/03/2023):
  • GEN.S.10.2 Fit and proper requirements
  • GEN.S.10.10 Outsourcing 
In addition, the following new standard was issued in Government Gazette # 8026 (with Industry comments due by 8/03/2023):
  • GEN.S.10.21 Treating customers fairly 
The following regulation and standards that were previously published were not uploaded onto the NAMFISA website nor republished in the Gazette to date (01/03/2023):
  • RF.R.5.10 The preservation of retirement benefits
  • RF.S.5.11 Alternative forms of payment of pensions for the purposes of defined contribution funds
  • ADM.S.8.1 Manner and form of application for registration of a fund and society administrator
  • ADM.S.8.2 Form of certificate of registration for a fund and society administrator
  • ADM.S.8.3 Manner and form of application for cancellation or variation of registration of a fund and society administrator
Since the changes to subordinate legislation are extensive, we will bring these to you in the next few newsletters.
 
Main changes identified that affect administrators and funds:
 
Regulation / standard   Change
  • General
 
  • "Retirement fund" & "beneficiary fund" to "fund" (standards only; not regulations)
  • "sub-clause" to "paragraph"
  • "individual" to "person"
  • 'should' to 'must'
  • “sum of the percentage of the repo rate charged by the Bank of Namibia plus an additional 4 percent per annum” to “rate determined for the time being by the Monetary Policy Committee of the Bank of Namibia to be the repurchase rate, plus 4%”
  • Standardisation of time periods (e.g., ’30 days’ to ‘one month’)
  • GEN.S.10.8
    Independence
 
  • Clause 6(1): Financial intermediary and financial institution must have a policy outlining how familiarity risk and threats to the independence of directors, members of a board, trustees, custodians, auditors, and valuators and of any other person required to be independent under the act, will be managed.
  • Clause 3(1): Addition of phrase ‘Unless the person can show that there is no direct conflict of interest’, the person is not considered independent
  • Clause 6(2): Addition of requirements for managing conflict of interest
  • GEN.S.10.17
    Description of Plain
    Language
 
  • Clause 3(4): The previous version required positive acknowledgment in writing that the client has understood the content of documents presented to the client.
  • The revised version:
    • only applies the requirement to documents which need to be signed by the client; and
    • it also does not require positive acknowledgement in writing that the client understood the contents of the document but rather that “the client would acknowledge in writing without duress if prompted to do so”.
  • GEN.S.10.18
    Fiduciary responsibilities of financial institutions and intermediaries and functionaries
 
  • Clause 3 of the previous version required all financial institutions and financial intermediaries and their functionaries to avoid conflicts of interest in respect of clients or investors.
  • This clause was changed to require financial institutions and financial intermediaries and their functionaries to avoid, or disclose to manage the unavoidable, conflicts of interest.
  • GEN.S.10.18
    Fiduciary responsibilities of financial institutions and intermediaries and functionaries
 
  • Clause 5(1) of this standard requires financial institutions and financial intermediaries and their functionaries to keep records of material dealings involving clients or investors to be able to demonstrate the execution of fiduciary duties.
  • Subclause (2) was added to require that the records required under sub-clause (1) must be in writing and kept either in hard or electronic copies for –
    • (a) five years effective from the date the relationship is terminated; or
    • (b) an extended period of time if specifically so requested by a competent authority before the expiry of the five year period referred to under paragraph (a).
  • RF.R.5.7
    The rate of interest payable on contributions not transmitted or received, and on the value of a benefit or right to a benefit not transferred, before the expiration of the applicable period, pursuant to section 270(9)
 
  • Clause 4: The previous version had a complicated way of calculating the Prescribed Rate which was impossible to execute.
  • The Prescribed Rate was simplified to repo rate + 4%.
  • RF.R.5.8
    The protection of unpaid contributions and the rate of interest payable on contributions not transmitted or received
 
  • Clause 5: The previous version had a complicated way of calculating the Prescribed Rate which was impossible to execute.
  • The Prescribed Rate was simplified to repo rate + 4%.

Editor’s comment

With the changes and new standards issued, the number of compliance requirements we identified increased from just over 600 to 758! It goes beyond anyone’s imagination and substantiates the fact that FIMA does not constitute a move from compliance to risk-based supervision but rather the opposite!

Something has gone seriously wrong with this monstrous new law. We should stand back now and ask ourselves “Is this what Namibia can afford and needs and what we want to achieve?” I fear that we have gone so far down the path, and have invested so much energy and resources that we will rather close our eyes and carry on, whatever the consequences may be!

 
Tilman Friedrich is a chartered accountant and a Namibian Certified Financial Planner® practitioner, specialising in the pensions field. He is co-founder, shareholder, and Chairman of the RFS Board and retired chairperson, and now a trustee of the Benchmark Retirement Fund.
  
Compliment
 
Compliment from a fund member and former principal officer of various funds
Dated 3 March 2023
 “Thank you very much for the confirmation Ms B.
May I also take this opportunity to sincerely thank you and your team for the excellent service rendered to me.
I have been a client of RFS (formerly UPA) since about 1990 and never looked back.  
With kind regards
JW”
 

Read more comments from our clients here...
Benchmark: a note from Günter Pfeifer
 

Important circulars issued by the Fund
 
The Benchmark Retirement Fund issued the following circulars during March. Clients are welcome to contact us if they require a copy of any circular.
  • Circular 202301 – Living Annuity Death Benefit
  • Circular 202302 – Beneficiary Annuity Death Benefit
  • Circular 202303 – Clarity Regarding Rule Amendment No 6
  • Circular 202304 – Death Benefits Questions and Answers – Clarification of Rule Amendment No 6
Günter Pfeifer was the Principal Officer and a trustee of the Benchmark Retirement Fund for many years. He holds a Bachelor of Commerce (Cum Laude). Günter completed his articles with Deloitte & Touche in Windhoek. He completed the De Beers ‘Program For Management Development’ at Gordon Institute for Business Science, and the Advanced Development Program at the London Business School. He was formerly Financial Manager of De Beers Marine.
 
News from RFS
 
Long service awards complement our business philosophy

RFS’ business is primarily about people. Whenever a fund changes its administrator, it loses fund information and knowledge. Similarly, every time the administrator loses a staff member, our clients lose corporate memory. As a small Namibian organisation, we cannot compete with large multinationals technology-wise because of the economies of scale, and sophistication global IT systems offer. We differentiate ourselves through excellent personal service and commitment to our clients, and IT systems that are more flexible, versatile and adaptable, and more appropriate for the Namibian environment. We are proud of our staff retention as we know that it is the key to our success!

Kai Friedrich, Director: Private Fund Operations, celebrates his 10th anniversary on 1 March. We express our sincere gratitude to Kai for his loyalty and support over the past ten years and look forward to his continued dedication and commitment to the company, our clients, and our colleagues!

 
RFS staff social function at Monteiro

RFS celebrated its staff on Friday afternoon, 3 March, at Monteiro just outside Windhoek. Here is an impression of our staff in jovial mood.
 

Annemarie Nel earns Ruby Quality Award

Annemarie Nel, Manager: Wealth Management, scooped one of only 22 Ruby Quality Awards handed over by Sanlam during this year’s awards function. We congratulate Annemarie sincerely and look forward to her providing continued exceptional service to her clients and making RFS proud!
 
 
Important circulars issued by RFS
 
RFS issued the following circular in Febuary. Clients are welcome to contact us if they require a copy of any circular.
  • RFS Circular 2023.02-01 New standard fund forms.
News from NAMFISA

 

 
More time given to comment on standards and regulations
 
NAMFISA issued a public notice granting extension for comments on the formal consultation on the subordinate legislation until 31 March 2023. The standards and regulations were published in government gazette no. 8026 of 7 February 2023. No further extension shall be granted should persons not adhere to the due date.
Legal snippets
 
A review of the Trustee Moneys Protection Act
 
Below is a summary of the salient features of the Bill prepared by Mrs. Andreen Moncur, BA Law.
 
Bank of Namibia and the Ministry of Justice have proposed this new legislation as part of the requirements identified as necessary to prevent Namibia’s greylisting. The primary goal is to prevent trusts from being used to launder money and finance terrorism.
 
The financial regulators have identified the loopholes that allow players to operate in unregulated spaces and are developing measures to close them. So banks will be regulated by BoN, NAMFISA will regulate all non-banking financial services except trusts, and the Master of the High Court will regulate trusts.
 
Once law, the Trust Administration Act will regulate the control and administration of trusts and trust service providers by imposing duties on trustees, accountants and auditors and regulating the appointment of trustees.
 
The following are the most pertinent aspects of the Bill:
  1. The Act applies to retirement funds, as will become apparent below. 
  2. The Trust Moneys Protection Act 34 of 1934 will be repealed. In terms of the transitional provisions, trust instruments made under the repealed Act will continue in effect to the extent that they are not inconsistent with the new Act. 
  3. All trusts, trustees and trust service providers must be registered by the Master of the High Court. No one may serve as a trustee unless the Master has registered the trust, and no one may do business as a trust service provider unless the Master has registered them as a trust service provider. 
  4. The beneficial owner of a trust includes the donor or settlor of the trust, thereby including retirement funds that pay benefits into trust for the benefit of members, dependants or nominees. 
  5. A dependants trust established for the benefit of retirement fund beneficiaries is a “trust” as defined in the Bill. 
  6. Per the Bill, the term “trustee” means any person, including the founder, donor or settlor of a trust who acts as trustee by virtue of an authorisation under section 6 and includes any person whose appointment as trustee is already in force at the commencement of the Act. For purposes of the Bill, a person is a natural person or a legal person. 
  7. A  “trust instrument” means a written agreement, testamentary writing, or court order creating a trust. A trustee resolution authorising the creation of a trust for a member or other beneficiary of a retirement fund (including the creation of a sub-trust for that member or beneficiary within an umbrella trust) is a trust instrument. 
    • Where the Bill requires a trustee to lodge a copy of the trust instrument with the Master of the High Court, the trust instrument must, amongst others:
    • identify the trust property bequeathed and all beneficial owners of the trust, including the beneficiaries, the settlor(s), the founding trustee(s), and any other natural person exercising ultimate effective control over the trust; 
    • indicate whether the trustee must provide security or is exempted; 
      • identify a beneficiary by —
      • full name;
      • physical address;
      • a valid email address;
      • nationality;
      • identification number or passport number if a non-citizen. 
  8. A “trust service provider” means a person, other than a person or business listed under Schedule I of the Financial Intelligence Act, that as part of his or her business, provides any of the following services to a third party — 
    • (a) Facilitating or sourcing contributions for the creation, operation or management of a trust or legal arrangement;
    • (b) acting as a formation agent for trusts;
    • (c) providing a registered office, business address or accommodation, correspondence or administrative address for a trust; or
    • (d)  acting as (or arranging for another person to act as) a trustee of a trust or performing the equivalent function for another form or legal arrangement.
      Since a retirement fund is not a person listed under Schedule 1 of the FIA, a retirement fund would be a trust service provider as envisaged in para (a) and possibly also para (d). A fund will have to register as a trust service provider to pay benefits into a trust for a member, dependant or nominee. In this regard, please see para 18 below.
  9. The Bill prescribes the fiduciary duties of trustees – essentially restating those in the Common Law and other laws, such as the Income Tax Act, the Trust Monies Protection Act and the Financial Institutions (Investment of Funds ) Act. 
  10. The Bill prescribes the duties of accountants and auditors concerning trusts. 
  11. If a trust instrument contains any provision which brings about consequences which in the court’s opinion the settlor/founder of a trust did not contemplate or foresee and which —
    • hamper the achievement of the objects of the settlor/founder;
    • prejudice the interests of beneficiaries; or
    • conflict with the public interest,
      the court may, on application by the trustee or another person who in the court’s opinion, has a sufficient interest in the trust property, delete or amend the provision or make any order the court deems just, including an order substituting certain trust property for other property or terminating the trust.
  12.  A trustee must register the trust property they hold in their capacity as trustee or make it identifiable as the trust property in the best possible manner and establish and record the beneficial ownership of the trust. 
  13. At any time, the Master can call a trustee to account for how they administer and dispose of trust property. 
  14. The Master can appoint a person to investigate a trustee’s administration and disposal of trust property and order the trustee to pay for the investigation. 
  15. The Master can remove a trustee from office. 
  16. A trustee is entitled to remuneration as provided in the trust deed. Trustee remuneration is by agreement if the trust deed does not provide for this. 
  17. Trustee remuneration may not exceed that prescribed by the Minister of Finance in the Gazette. 
  18. Various acts/omissions constitute criminal offences, e.g. acting as a trustee or trust service provider without registering with the Master, failing to deposit trust money in a separate trust account at a bank/building society, or failing to prepare and submit the trust’s annual tax returns to NamRA within three months of the trust’s financial year-end of the trust. Conviction carries a maximum fine of N$10 million or ten years imprisonment, or both. 
  19. Despite the offences and penalties under section 31, the Master may impose prescribed administrative fines on anyone failing to comply with the Act and its subordinate legislation. The maximum administrative fines range between N$500 000 and N$10 million.
New definition of Remuneration for VET levy purposes
 
“Did you know that the definition of “remuneration” for the purposes of VET levy changed in April 2021?
 
The previous definition of “remuneration” was aligned to the definition as per the Labour Act, 2007, however, effective 1 April 2021 the definition changed to align with the Income Tax Act, 1981 (Act No.24 of 1981)...”
 
Read the PWC newsletter on this and many other topics, here…


Snippets for the pension fund industry
 
Seven worst mistakes for retirement planning
 
There are many mistakes you need to avoid in order to retire comfortably. But of these hundreds of mistakes, here are the 7 worst mistakes you must avoid at all costs.
  1. Underestimating medical expenses
  2. Post-retirement spending spike
  3. Keeping too many cars
  4. Moving house
  5. Getting sold or scammed
  6. Putting savings in the wrong place
  7. Retiring too soon 
In this and the next newsletters, we will examine these seven worst mistakes and what you can do about them.
 
1. Underestimating medical expenses

You are healthy and young. You will probably not think about the medical expenses. Some will even term it the “it won’t happen to me” problem. But in reality, you will almost certainly encounter some type of serious health problem if you live long enough.
 
And these health problems usually come at the age when you are about to retire or when you have retired.
 
A simple survey done just recently shows that 90.2% of all respondents have no idea of what their future medical expenses will cost. 75.3% said they have no strategy for paying their post-retirement medical cost at all!
 
This result is shocking, and medical expenses are definitely a problem that we will face in the future.
 
As part of our retirement planning, we should always factor in these unexpected expenses to ensure our health will be well taken care of.
 
How to Fix

But first, we need to know how much we actually need.

A report by Fidelity shows that an average person living in a first-world country such as the United States, Australia, Canada, and Singapore will estimate up to $200,000 over the entire post-retirement lifespan.
 
What You Can Do:
  • Buy a supplemental health insurance coverage to ensure that your post-retirement medical bills are taken care of.
  • Plan for long-term care as well such as long-term care insurance, or make plan for whom to care for you.
  • Plan for assisted care provided by a facility, or in-home care service. 
2. Post-retirement spending spike

Spending spike? It usually comes as a surprise to many people, but our research says retirees spend more, not less. Well, at least for the first few years.
 
Some term it the “I am free” symptom.
 
We see all these new-born retirees who are finally free from their 9 to 5 jobs and are free to do the things they always wanted. Ranging from traveling the world to golfing in the Maldives (Is there a golf course in the Maldives?). 

A few years down the road, when they finally look at their budget, they have spent way too much to last through their retirement.

Ouch!
 
How to Fix

When it comes to spending, the best advice we can give is to make a budget. Like the home budget article we have written previously. Budgeting for post-retirement spending is just as important.
 
What You Can Do:
  • Set a post-retirement budget
  • Track your spending
  • Downsizing to what you need 
Read the complete article in Daily Investor of 7 February 2023, here…
 
Living annuities as an option for retirement income 

“When retiring from a pension, provident, preservation, or retirement annuity fund, choosing an appropriate annuity income for your retirement years is one of the most important decisions you will need to make. For many, it’s a decision they’ve never had to make before and one they’re likely never to have to make again. Navigating the range of annuities, in particular, living annuities and service providers, can be somewhat daunting. As a start, it’s important to understand how they work, their benefits, and their important role in your overall estate plan.
 
When you retire from a pension, pension preservation or retirement annuity fund, you are required to use at least two-thirds of the invested capital to purchase what is colloquially referred to as a pension income. The remaining one-third can be commuted as cash. Members of a provident or provident preservation fund do not have this forced purchase of a pension income on the portion of the investment fund acquired prior to March 2021 [Note: in Namibia, provident funds pay out the full capital in cash].
 
The first R500 000 of the portion commuted as cash will be tax-free (assuming you have not made any previous withdrawals from a retirement fund), whereafter tax will be levied at a sliding scale of between 18% and 36% [Note: in Namibia, one-third is always tax-free]. If you elect not to make a cash withdrawal, you have the option to use 100% of your invested assets to purchase a pension income, although, in the absence of adequate discretionary funds, this could create liquidity problems later in retirement. As such, the decision to commute a portion of your investment as cash can be a strategically important one for creating flexibility and cash flow in your retirement years.
 
Unlike a life annuity (which is an insurance policy designed to provide a guaranteed income for life), a living annuity is an investment held in the investor’s name which is generally linked to an underlying investment on a LISP platform allowing the investor to draw a regular income in line with their needs…”
 
Read the article by Eric Jordaan of Crue Investments in Moneyweb of 23 February 2023, here…
 
 

Snippets of general interest

 
 What the law says about selling a house with defects in South Africa

“Sellers of homes are not always protected by law if there is a latent defect to the property that they are unaware of.

The voetstoots clause does not protect sellers aware of a latent defect in the property they are selling if they do not notify the buyer of the issue.

Buyers will often discover unpleasant surprises shortly after they purchase a property; however, the voetstoots clause states that the purchaser buys the property from the seller as it stands, preventing the seller from claiming damages with respect to defects in the property.

There are two types of property defects:
  • A latent defect is not readily revealed by a reasonable inspection of the property being sold
  • A patent defect is not hidden and should be easily noticed during a reasonable inspection.
The purchaser has the duty to acquaint themselves with the condition of the property when purchasing it and cannot later claim that they did not see any patent defects.

However, sellers who are aware of the defects must disclose the information to the purchaser, as they will not be protected by the voetstoots clause if the buyer later discovers the known issue within the property…”
 
Read the full article by Luke Fraser in Businesstech of 26 February 2023, here…
 
Securing your child’s financial future

“...There are many aspects that one must consider when becoming a parent, but the responsibility that cannot be overlooked is financial security. Most of us are aware that having children can become a very expensive endeavour really quickly – but planning ahead can help you better navigate this treacherous landscape of newly appointed parenthood.

One of the best ways to make sure you are properly prepared for your child’s financial future is to speak to a qualified financial advisor. A financial advisor will be able to look at your financial portfolio objectively and give you the necessary advice on how to revise it optimally – while still keeping your personal financial goals in mind.

Financial necessities to take into consideration for your little one:
  1. Update household budget - You might need to reallocate some of your funds to ensure that you have enough spending money for when your baby arrives. This does not, however, mean cancelling a policy that will protect your family in the future.
  2. Add your child to your health insurance plan - Having a baby would likely require an enrolment period during which you can make the necessary changes to your policy or upgrade to a different one that accommodates the soon-to-be new member of the family.
  3. Life insurance, capital disability, and severe illness - None of us wants to think we’re going to fall sick, get injured, or even pass away prematurely but protecting your family will give you peace of mind.
  4. You need to get a will - A will ensures that your assets and personal possessions are divided up among those individuals you want to inherit them. Without a legally valid document setting this out, your estate won’t necessarily be bequeathed according to your wishes.
  5. Revise and update your emergency fund - An emergency fund covers unforeseen expenses that pop up unannounced, for example, a household appliance breaks. Make sure you have at least three to six months’ salary saved.
  6. Start saving for your child’s education - If you feel overwhelmed by the costs of sending your child to school or a tertiary institution – remember that the sooner you start saving, the more compound interest you will earn, and the better your long-term gains will be...”
Read the full article by Natasha van Rensburg of Attooh! Financial Wellness in Moneyweb of 16 February 2023, here...
 


And finally...
 
Funny anecdotes

"ATTORNEY: “How was your first marriage terminated?”
WITNESS: “By death.”
ATTORNEY”: “And by whose death was it terminated?”
WITNESS: “Take a guess.”
 

From a book called 'Disorder in the American Courts' and are things people actually said in Court, word for word, taken down and now published by court reporters who had the torment of staying calm while these exchanges were actually taking place.



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Whilst we have taken all reasonable measures to ensure that the results reflected herein are correct, Benchmark Retirement Fund and RFS Namibia (Pty) Ltd do not accept any liability for the accuracy of the information and no decision should be taken on the basis of the information contained herein before confirming the detail with the relevant portfolio manager.