IOL MONEY - April 2022: Retirement Living

IOL

MONEY APRIL 2022

RETIREMENT LIVING

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CONTENTS FEATURES 6 Most surprising things about retirement

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When’s the right time to move to a retirement village?

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Five common mistakes to avoid

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Checklist for buying into a retirement village

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REGULARS Money Basics with Martin Hesse

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Fact File: Types of property ownership

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Planning Perspectives with Palesa Tlholoe

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Important contacts & links

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FROM THE EDITOR Retirement: It’s nice to get out of the rat race, but you have to learn to get along with less cheese.

– GENE PERRET writer and producer

@PERSONALFINANCE

CONTACT US PUBLISHER Vasantha Angamuthu vasantha@africannewsagency.com MONEY EDITOR Martin Hesse martin.hesse@inl.co.za DESIGN Mallory Munien mallory.munien@inl.co.za PRODUCTION Renata Ford renata.ford@inl.co.za BUSINESS DEVELOPMENT Keshni Odayan keshni.odayan@inl.co.za SALES Charl Reineke charl.reineke@inl.co.za INQUIRIES hello@africannewsagency.com

ALTHOUGH retirement is a word I try to steer away from, because today’s concept of retirement is very different from how our parents conceived it, there is no getting away from a simple fact: if we're lucky to live that long, we will all reach a time in our lives when we physically cannot work any more, and thus cannot earn a living. This might already be at age 65, when employers are obliged by law to “retire” us. But it is increasingly likely to be at a more advanced age. Why? Either because you cannot afford to retire at 65 and are forced to find some means of continuing to earn an income, or simply because you’re still relatively healthy and want to carry on doing what has brought you fulfilment and satisfaction throughout your life.

But even for those healthy, happy, fulfilled people who seem to go on forever, there comes a time when they have to hang up their boots and say “Enough is enough”. And it’s then when you need to be financially secure, when you could do without having to keep up the maintenance on your home, for example, and when you need the healthcare support that will be increasingly necessary as you age.

So for many, a retirement village provides an ideal solution. And not only when you get to that tipping point. In fact, retirement specialists recommend that you move into one sooner rather than later, so that you can enjoy all the benefits and activities such community living has to offer while still continuing to work until you hang your boots up for good and enjoy a well-deserved rest.

Martin Hesse

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MOST SURPRISING THINGS PEOPLE ARE DISCOVERING IN RETIREMENT

Although many people spend unnecessary time fearing the ageing process, the “golden years” are often the most exciting, says Phil Barker, managing director of Renishaw Property Developments. The stresses of work fade away, and time can be better spent on activities of interest that stimulate the mind and revitalise the soul.

1. LIFE GETS MORE ACTIVE

Without having to commit to the restrictive hours of work, there’s now time in the day to engage in physical activity. Whether it’s a sunrise brisk walk on the beach, hiking or mountain biking in the coastal forests, paddling on the ocean or simply playing golf with friends, retirement is the time to get active – and feel younger because of it.

2. RETIREES STILL DO THE WORK THEY ENJOY

Retirement was once a time where work ended once the golden watch was handed over – not anymore. The modern retiree can enjoy the freedom of retirement while still working from home. The increased digitisation and remote working trend that has followed in the wake of Covid-19 is beneficial for retirees. All those years of experience and understanding can now be put to use in the role of remote consultant – or even on starting on a completely new venture.

3. RETIREES FIND A SENSE OF PURPOSE

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For some, continuing with work, or embarking on a new career path, provides a valuable sense of purpose.

For others, retirement offers the chance to get involved in causes closest to the heart. There is a real sense of meaning in being able to give back to the community.

Whether it’s sharing expertise or volunteering time, retirement provides people with the opportunity to really make a difference. In fact, a study done by Merrill Lynch found that retirees were three times more likely to find happiness in “helping those in need” rather than spending on themselves.

4. RETIREMENT CAN LAST LONGER THAN EXPECTED

With life expectancy increasing – yet retirement age remaining steadfast at around the 65-year mark – the golden years are stretching on for longer than before. This is really important to note as it will need to factor into the financial planning ahead of retirement, but it also means a lot more time to engage in activities that bring happiness and a sense of purpose.

5. THERE ARE LOTS OF ‘FIRSTS’ STILL WAITING

This is no longer a time to say “been there, done that” but rather a time to explore new opportunities, embark on exciting adventures and learn new things. Granted, Covid-19 has put a bit of a dampener on international travel, but until that opens up again, there is so much to explore in South Africa’s backyard. This is the perfect opportunity to try out new hobbies and interests and even enrol in some online learning.

6. SOCIAL LIVES BECOME MUCH BUSIER

The Merrill Lynch survey also indicated that 80% of retirees considered socialising to be vital to their happiness. That’s why so many are choosing secure estates that prioritise a relaxed and healthy lifestyle with community living. Keeping fit could mean joining an exercise class, a walking group or a cycling club, while volunteer work and hobbies also provide great opportunities for socialising.

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WHEN’S THE RIGHT TIME TO MOVE INTO A RETIREMENT VILLAGE? Moving into a retirement community is a big decision for retirees and their families, and there are many considerations to take into account.

RETIREMENT villages offer the advantages of independent living in your own space, without the time-consuming maintenance of your own home, says Garry Reed, managing director of Evergreen Lifestyle Villages. And there is anecdotal evidence that such a lifestyle even boosts your life expectancy, thanks to the amenities they offer.

But how do you know the time

is right to make such a move?

And once this decision has been made, how do you choose the accommodation best for you?

The experts offer this advice: WHEN IS IT TIME TO MOVE? Phil Barker of Renishaw Property Developments says this is a very subjective decision and one that is often taken when

people’s health starts to fail.

His experience is that the vast majority of people leave it later than they should.

“The increase in stress levels of moving home is directly proportional to the age of the mover. Everyone handles stress differently, so this is not a universal law, but moving at 65 is generally far less stressful than moving home at 75. One needs

7 to be proactive and understand that age-related illnesses come upon one suddenly.

“The retiring baby-boomer generation is more proactive in this regard and there are more people moving into mature lifestyle villages in their late 50s early 60s, which is the ideal time, bearing in mind modern villages cater for an active lifestyle.”

and go, knowing your home is safe and secure.

CHOOSING THE RIGHT VILLAGE Barker advises prospective purchasers to visit at least five villages to make comparisons.

“We propose that the prospective purchaser draws up a comprehensive list of questions that should be satisfactorily answered by the salesperson.

CONSIDERATIONS The list will be long but should FOR MOVING Reed says the main considerations always start with security, which is paramount.” revolve around: A wall or electrified fence and ● Physical health: In later life, gatehouse alone are not sufficient. the importance of being able “Security should include 24/7 to access medical care quickly CCTV monitoring of the fence and easily while not breaking line in a professionally operated the bank, will become a priority, control room with an armed so having healthcare facilities response back-up.” and trained professionals close Other questions to ask relate at hand means that you will be to health-care provision, the able to enjoy your golden years monthly levy and what it covers, without worrying unduly about community life and facilities, these unforeseen eventualities. and the financial strength of the ● Mental health: Loneliness, body corporate. Buyers must boredom and social isolation obviously also check that prices become a reality as you age, particularly if you’re stuck behind and payment options suit their high walls in the suburbs, nursing budgets, Barker says. a spouse, or no longer able to drive. Retirement villages however INDEPENDENCE WITHIN A COMMUNITY are home to vibrant communities Many senior living communities of elderly people who are keen are aware that retired people to make new friendships, to stay don’t want to give up their active, and even to learn new independence; they simply want a skills. structure that is beneficial to their ● Home and garden needs and lifestyle. maintenance: Cooking, cleaning “Retirement neighbourhoods and gardening all get much more can use technology, expert difficult as you age, and keeping service providers, and a wealth of up with home maintenance can options for living, eating, enjoying be both onerous and costly. exercise and entertainment In modern retirement villages, to ensure that residents are professional teams take care of independent and happy”, says home maintenance, gardening, owner of Manor Lifeproperty, Gus healthcare, housekeeping, van der Spek. laundry, and catering.

On the other hand, he says ● Security: At most professionally living in a retirement community run retirement villages, 24-hour lessens isolation, provides security, security is part of the package. companionship and care, and And if you do go away on this has especially been the case holiday, you can simply lock up

during Covid restrictions, which have seen older people facing intense isolation. Living in a senior community can help residents create relationships with peers, carers, and service providers, and feel less alone.

Many senior living communities allow pets, or in other cases, certain types of pets such as one small dog. Some facilities may offer care for pets if residents cannot care for their pets alone.

HEALTH BENEFITS Enjoying leisure activities with friends, such as playing bridge or participating in a book club, have been found to protect cognitive skills. Physical activity, such as walking and hiking, gardening or yoga, is one of the most important things you can do for your health.

“Senior living communities also reduce the incidence of falls, one of the leading causes of injury and death,” Van der Spek says.

“The likelihood of a fall going unnoticed in a senior community is low, as well-lit and clutter-free living areas prevent falls, and exercise and physical therapy can reduce their instances and severity.”

MEDICAL CARE AND AMENITIES Before choosing a senior living community, you should assess the level and quality of healthcare the community provides. Is there a frail care section? Does it have intermediate assisted-living accommodation? You should also confirm the community’s procedures in the event of an emergency, their disaster preparedness, and which hospitals will be used if admission is necessary.

“This will help ensure a person receives the right level of care and can avoid revisions to their routines after they move in,” Van der Spek says. | IOL

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YOUR TAXES IN RETIREMENT

MONEY BASICS

with MARTIN HESSE

ONE would think the government would have more sympathy for pensioners by allowing them to live tax-free – after all, they have been paying tax throughout their working lives!

Sadly, pensioners who are earning above a certain minimum amount are obliged to pay income tax, just like everyone else. And apart from income tax, there are virtually no concessions for pensioners when it comes to capital gains tax, dividends tax,

VAT, or estate duty, to mention some of the other ways the government extracts revenue from its citizens.

That said, the government is not totally unsympathetic, and there are a few important ways in which pensioners can pay less tax, through higher exemptions and thresholds for over-65s. Let’s look at some of your main taxes and concessions.

INCOME TAX You pay PAYE on pension income from an annuity provided by a provider such as a life insurance company.

If it is a compulsory annuity (one you have to buy with two-thirds of your savings in a retirement fund), you are taxed on the whole amount, in accordance with the SARS income tax tables.

You pay income tax because your contributions to your retirement fund during your working life were tax deductible.

If it is a voluntary annuity

(that is, one that you buy with discretionary savings or from the one-third of your retirement savings you are allowed to take as a lump sum), you only pay tax on that part of your income that derives from investment returns, not from your original capital (because that capital came from after-tax money).

Within the annuity investments that are providing your pension, there is no tax on capital gains, dividends or interest.

If you are receiving income from various sources, you will need to register with SARS as a provisional taxpayer, subject to certain thresholds. For the 2022/23 tax year, the rebate for over-65s (the primary plus secondary rebates) is R25 425.

For over-75s this rises (primary plus secondary plus tertiary rebates) to R28 422.

This equates to tax thresholds (the amount of annual income below which you do not pay tax) of R141 250 for over-65s

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and R157 900 for over-75s.

TAX ON INTEREST If you are earning interest on a discretionary investment such as an RSA Retail Savings Bond, bank deposit or interest-bearing unit trust fund, there is a higher exemption for over-65s: R34 500 (for under65s it is R23 800).

In other words, if, for example, you earned R100 000 in interest from a fixed deposit, R34 500 would be tax-free and the remainder (R65 500), would need to be added to your total taxable income for the year, on which you will be taxed according to the SARS income tax tables.

CAPITAL GAINS TAX (CGT) There are no CGT concessions for over-65s, except that you don’t pay CGT on gains within an annuity product. On property and on share-based investments (such as an investment in an equity fund), you pay CGT when you realise a gain – in other words, when you sell the investment or switch funds, say from an equity fund to a balanced fund.

On anything over that, 40% must be added to your taxable income for the year. And on that amount you have an exclusion

of R40 000. On your primary residence property, the exclusion is R2 million.

You don’t pay CGT on gains on “personal-use” assets, which include artworks and wine collections.

ESTATE DUTY Estate duty is levied at 20% on estates up to R30 million and at 25% on amounts over R30 million.

However, there is an exemption of R3.5 million, meaning essentially that if your estate is below that amount, you do not pay estate duty.

This exemption rolls over to the surviving spouse, meaning the estate of the last-dying spouse has an exemption of R7 million minus any of the R3.5 million exemption used by the first dying spouse.

MEDICAL TAX CREDITS One additional concession by SARS to pensioners is that they can claw back higher amounts on medical expenses.

Some years ago, the government introduced the medical tax credit system, which is more complicated than the old system of claiming deductions for medical expenses.

You get credits in two ways:

1. On contributions to a medical scheme (R347 a month for the taxpayer who pays the medical scheme contributions and for the first dependant such as a spouse, totalling R694, and R234 for any additional dependants.

If you are 65 years or older you may also claim 33.3% of your contributions that exceed three times the medical tax credit to which you are entitled. For example, if, as a single person with no dependants, you are contributing R3 000 a month to your medical scheme, you can claim a monthly credit of: R347 + 33.3% of [R3 000 – (R347 x 3)] = R347 + 33.3% of [R3 000 – .R1041] = R347 + 33.3% of R1 959 = R347 + R653 = R1 000 2. On allowable “out-of-pocket” medical expenses not paid for by your medical scheme. If you are 65 years or older you may claim 33.3% of these medical expenses.

Note that you do not deduct these amounts from your taxable income for the year.

The credits act like rebates, deducted from the tax amount you owe SARS.

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FIVE COMMON MISTAKES TO AVOID WHEN PLANNING YOUR RETIREMENT BJORN LADEWIG, head of distribution at retirement income specialist Just SA, pinpoints common mistakes retirees make about their finances in retirement.

WHEN you’re ready to retire, one of the biggest decisions you’ll face is choosing an annuity to provide you with a regular income in retirement.

Considering the unpredictability of investment markets, increased longevity and a crowded retirement product market, it’s not an easy choice. Yet the stakes are high and the consequences far-reaching.

Even worse than worrying if you’ve saved enough for retirement during your working life is running out of money after you have already retired. In fact, research from Just SA has shown that 60% of people in or approaching retirement lack the confidence that their income will cover their monthly expenses throughout retirement.

Our experience has seen retirees make the same errors time and time

again when it comes to important decisions about retirement income.

Specifically, there are five common mistakes that you should try to avoid.

1. UNDERESTIMATING HOW LONG YOU WILL NEED YOUR RETIREMENT INCOME TO LAST Longevity is an accelerating macro trend, with World Economic Forum research revealing an average life expectancy of at least 100 for those born after year 2000, which is more than a decade longer than their parents’ generation and two decades longer than their grandparents.

To help protect and thus stretch your retirement income further, it’s a good idea to ensure that your essential spending is covered with a

guaranteed, sustainable income for the rest of your life. You should also be sensible with any other assets and investments you may have. For example, if you are drawing more than 4% from these assets, it may not be sustainable for life. Finally, where possible, a side hustle or freelance work is a great way to bolster your retirement income.

2. PUTTING TOO MUCH VALUE ON FLEXIBILITY Many people choose a pure living annuity as their retirement income solution for its perceived flexibility.

However, you should not forget that this flexibility comes with increased risk. Research has shown that the majority of people in and approaching retirement don’t want to take risks with their retirement

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fund money (65%) and many cannot afford to lose any money at all (38%). Yet living annuity products – where you are fully exposed to market turmoil – are still the most popular choice.

3. PLACING TOO MUCH IMPORTANCE ON A CAPITAL LEGACY As in life, there are trade-offs in retirement. Having an income that lasts and leaving a legacy are often opposing ideas. Practically speaking, choosing the ‘wrong’ annuity product so that you can provide for your dependants could mean that you end up dependent on them instead.

So rather than being conservative in order to leave money to heirs, we suggest you rather focus on reducing your risk of depending on your loved

ones later in life. The best way to do this is with a retirement income that is guaranteed to at least cover your essential expenses.

4. BELIEVING IT'S ALL OR NOTHING Most people think you must either put all your money in a living annuity or a life annuity, but this is not true.

You can mix the two with a blended annuity approach i.e. a combination of retirement solutions that provides income for life, flexibility and the opportunity to leave a capital legacy. Income from the life annuity component gives you sufficient peace of mind and liquidity to fund your essential expenses for day-to-day living. The remaining living annuity assets can be invested to provide long-term capital growth.

5. GOING IT ALONE Without an accurate understanding of your current financial situation and retirement needs, it is almost impossible to set realistic and achievable financial goals, let alone work towards them. Just SA research shows that only four out of 10 preretirees and retirees use – or intend to use – the services of a professional adviser, yet over half have not yet calculated how much they need each year to live off in retirement.

We strongly recommend that you compare product features and pricing of available retirement solutions with the support of a trusted, independent specialist, so that you can make informed choices.

This will also help to close the gap between the expectations and reality of retirement.

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CHECKLIST FOR BUYING INTO A RETIREMENT VILLAGE Rob Jones, managing director of specialist retirement consultancy Shire Retirement Properties, has compiled the following checklist for people considering buying into a retirement village.

WHERE TO START? ● Have you consulted available guides to retirement villages? Few are available in South Africa, however the availability of Google Search provides ample info on villages in a particular area.

Seniorservice.co.za has a fairly comprehensive directory, as a place to start looking. ● Are you looking for a retirement village with a range of services? ● A normal residential estate with security? ● A lifestyle estate with a range of amenities and services? ● What are your specific requirements? Consider the location of your children and close friends. Consider the proximity of specific services important to you. ● What forms of occupation would you consider? Life right (life lease), freehold ownership,

sectional title ownership, short or long-term rental/lease? ● Do you have a preference for a type of physical structure? (cottage, apartment, etc) ● Do you want flexibility of care provision? ● What monthly levy costs can you afford? Do you have a current budget that you can use to see how it will be affected? ● Do you want to have care in your own home available? ● What other services must or should be available? ● Are you aware of the risks of buying into a phased or mixeduse development? ● What level of escalation in levy costs can you cope with annually?

THE PURCHASE PROCESS ● Be sure that a sales mandate is in place between the seller (the developer, if it is a new estate) and the sales agent.

● Ask whether there is price flexibility/negotiability and what is flexible in terms of the property being built for you or sold to you if it is new. ● Clarify the snagging process (the resolution of defects in new buildings). ● Ensure that the National Home Builders Registration Council warranty is in place (if applicable). ● Ask for the constitution and legal structure of the village – this includes the management and conduct rules. ● Ask for the minutes of last three trustee meetings and the last AGM of the Association or Body Corporate. ● Clarify the village’s debt/ financial situation – this should be part of the last AGM documentation, but if you are unsure, ask someone to take you through them. ● Ask what the levy

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stabilisation mechanisms are – how are financial reserves built up by the village? ● If important to you, enquire about the age, gender and health profiles of residents. ● Ask about the activity levels of the village (including social responsibilities). ● Does the village comply with the terms of the Housing Development Schemes for Retired Persons Act 65 of 1988? Is the title deed endorsed as per the Act? ● Review the conduct rules and make sure they are acceptable to you, including rules about pets and visitors. ● How much downsizing will you have to do to fit into your new home?

LIVING WITH YOUR NEIGHBOURS ● Ask for introductions to your new neighbours by your agent or by the estate manager. ● Is the village pet friendly? ● Does the village have and enforce architectural guidelines? ● Does the village enforce their conduct rules? ● Are there speed limits in the village? ● Are short-term leases allowed in the village? Is AirBnB and other very short-term rental services allowed in the village?

● Are visitors allowed to stay overnight or for extended periods? ● Are residents allowed to trade (business operations) from their units? (Working from home as opposed to trading from the unit where customers are coming and going) ● Which social activities and amenities will interest you? Gardens, library, sports bar, workshop, bridge club, community activities?

LIVING WITH YOUR PARTNER ● Do you have agreement on what “retirement” means to each of you? ● Have you recently stopped working? How will you adapt to the new realities? ● Have you given yourselves a month or two to settle down and adapt or are you rushing decisions regarding retirement living choices? ● Have you ever lived together 24/7? ● How good is your general communication? ● Have you drawn up and agreed on common and separate bucket lists? ● Are your financial matters in order? ● Do you both understand the “retirement” budget?

● Are you going to be living off a fixed income? ● Have you considered what exciting, fun things you will pursue? ● Which roles will be shared and who does what? ● What do your children expect from you and you from your children? ● Are your legal matters in order? Estate planning? Last wills and testaments? Do you have a living will or clear instructions from you regarding end of life?

LIVING WITH YOURSELF ● What are you planning to do about your physical health? ● What are you planning to do about your mental health? ● What are you planning to do about your spiritual health? ● What hobbies will you be pursuing? ● Are you able to cope on your own? ● Have you considered an adult learning programmes? ● Do you intend to do part-time or full-time work during your retirement? ● Have you considered volunteering with an NGO or charity? ● Do you have a “big project” to keep you busy – like writing a book or getting that diploma?

FACT FILE

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TYPES OF PROPERTY OWNERSHIP RETIREMENT villages are governed by the Housing Development Scheme for Retired Persons Act, which imposes certain onditions on developers and residents. There are four types of ownership, with some developments based on one type and others offering a choice between two or more types: 1. Freehold title.

This is essentially the same as owning a freestanding home, with the same rights, expenses and responsibilities, except that, because the home is within a gated community setting, there will be a monthly levy to cover services such as maintenance of the common areas, security, catering and healthcare.

Some developments will retain a certain portion of the profits on resale, as a way of subsidising the levies owners pay.

2. Sectional title.

This is similar to sectional title in a non-retirement development, where rates, insurance and maintenance of the complex is funded by a

monthly levy. The scheme will have a board of trustees and a body corporate, through which all owners have a say in decision-making. As with a freehold title scheme, the developer carries no responsibility for the ongoing maintenance and cost management aspects once the development has been built; the onus falls on the owners or residents to do so.

3. Life right. You buy the right to live in a dwelling for your life and that of your spouse – you don’t actually own physical property.

There are no legal costs, transfer duties or other taxes payable.

You may dispose of your life right or it will be sold on your death, in which case you or your estate will, depending on the contract, receive the purchase price plus a percentage (say, 30%) of the profit.

When a life right transfers to a spouse on the death of the firstdying spouse, it does not form part of the firstdying spouse’s estate.

Residents, who pay a

monthly levy to cover running costs, enjoy similar privileges to those in sectional title homes; the developer, however, remains the sole owner and is responsible for the upkeep of the village.

4. Share block.

Under this structure, which is now less common, the complex is registered in the name of a shareblock company, and each unit is allotted a certain number of shares in the company.

You purchase shares, which give you the right to use a flat, cottage or townhouse and the complex's facilities, but you do not own your dwelling.

There is typically an AGM at which shareholders elect directors to the board.

Directors meet throughout the year to discuss how the property is to be managed.

Shareholders pay levies that cover operating costs, including maintenance and insurance. If you decide to sell, you need to sell your shares in the property and cede your rights to occupy the unit.

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Planning Perspectives

POST– RETIREMENT LIVING EXPENSES

Palesa Tlholoe

THE start of retirement living is often assumed as the time when all challenges cease as you start receiving an income from your funds. However, myths vary from thinking that your monthly expenses will reduce, mortgages and other debts will be paid off, there will be no more expenses, and therefore, there's no need to worry about planning.

This is not necessarily the case! If anything, post-retirement living requires even more planning, attention to detail, and prudence because the ability to earn more than what you previously made no longer exists. Here are some of the realities that exist and should be considered when planning for retirement.

Risk vs return If you are in the process of retiring and therefore buying a living annuity, life annuity, or a voluntary investment with your retirement funds, you need to assess your level of risk.

Your risk ability and appetite might have reduced drastically, meaning there are certain types of investments you need to avoid due to their high risk.

The opposite of risk is opportunity (return or growth).

While it's essential to consider your risk tolerance, you still want decent growth in your investments post-retirement because the funds may need to last you for another 30 years.

Some exposure to riskier assets such as equities presents an opportunity to grow your investments.

Professional investment advice becomes an absolute must, and this must happen regularly, at least once per year. On the other hand, if you have chosen to go with a life annuity, your income and any applicable increases are predetermined in advance, which means you carry little to no market risk in that investment.

Monthly expenses Your monthly expenses may be higher than expected. For instance: ● Your medical aid may be higher after retiring because you no longer have the subsidy you previously had while still employed. As a result, you may need to find a cheaper alternative. But remember, there may be waiting periods when changing providers if you have pre-existing medical conditions. ● Your out-of-pocket medical expenses may also be higher as you get older and need more medical attention. You can accommodate those additional expenses in your budget by putting the funds in a separate account (for instance, via a debit order into a money market account). ● Levies, rates, and taxes for property owners can be an unbearable cost, as they keep going up. An alternative is to move into a property that does not attract these fees if your budget cannot accommodate these expenses. But remember there are costs to downscaling, including capital gains tax, estate agent's fees and transfer duty if you purchase another property. ● Inflation is inevitable! And there's nowhere to hide from it.

The only way to circumvent this issue is to choose an annuity that increases in line with inflation yearly.

Applicable taxes Tax is an expense that follows us even post-retirement.

The only silver lining is that tax thresholds are higher from age 65 at R141 250 vs R91 250, and they get even higher by age 75 at R157 900. This means if your income is below these values, you won’t need to pay tax.

Palesa Tlholoe, CFP, is Co-Founder and a director at Imvelo Wealth

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INFORMATION click on the links to visit the website

Here are sources that can help you with financial education, give you more information on savings and investments, and afford you recourse if you have a consumer complaint or a complaint against a financial services provider

FINANCIAL EDUCATION Financial Sector Conduct Authority MyMoney Learning Series https://www.fscamymoney.co.za South African Savings Institute #WaysToSave https://waystosave.co.za/ OMBUDSMAN & REGULATORS Ombudsman for Banking Services ShareCall: 0860 800 900 or phone: 011 712 1800 Email: info@obssa.co.za www.obssa.co.za CONSUMER ISSUES National Consumer Commission Toll-free: 0860 003 600 or phone: 012 428 7000 Email: complaints@thencc.org.za www.thencc.gov.za CONSUMER GOODS AND SERVICES OMBUD ShareCall: 0860 000 272 Email: info@cgso.org.za www.cgso.org.za

FINANCIAL ADVICE Ombud for Financial Services Providers phone: 012 470 9080 or 012 762 5000 Email: info@faisombud.co.za www.faisombud.co.za INVESTMENTS Financial Sector Conduct Authority ShareCall 0800 110 443 or 0800 202 087 info@fsca.co.za www.fsca.co.za LIFE INSURANCE Ombudsman for Long-term Insurance ShareCall 0860 103 236 or phone: 021 657 5000 Email: info@ombud.co.za www.ombud.co.za MEDICAL SCHEMES Council for Medical Schemes MaxiCall: 0861 123 267 Email: complaints@medicalschemes.com or information@medicalschemes.com www.medicalschemes.com

CREDIT OMBUD MaxiCall: 0861 662 837 or phone: 011 781 6431 Email: ombud@creditombud.org.za www.creditombud.org.za

RETIREMENT FUNDS Pension Funds Adjudicator ShareCall: 0860 662 837 or phone: 012 346 1738 Email: enquiries@pfa.org.za www.pfa.org.za

NATIONAL CREDIT REGULATOR ShareCall: 0860 627 627 or phone: 011 554 2600 Email: complaints@ncr.org.za or (debt counselling) dccomplaints@ncr.org.za www.ncr.org.za

SHORT-TERM INSURANCE Ombudsman for Short-term Insurance ShareCall 0860 726 890 or phone: 011 726 8900 Email: info@osti.co.za www.osti.co.za

TAX Tax Ombud ShareCall: 0800 662 837 or phone: 012 431 9105 Email: complaints@taxombud.gov.za www.taxombud.gov.za PROFESSIONAL ORGANISATIONS Fiduciary Institute of Southern Africa (FISA) phone: 082 449 2569 Email: secretariat@fisa.net.za www.fisa.net.za Financial Planning Institute of South Africa (FPI) Phone: 011 470 6000 Email: info@fpi.co.za www.fpi.co.za South African Institute of Tax Professionals (SAIT) Phone: 012 941 0400 Email: info@thesait.org.za www.thesait.org.za FINANCIAL DATA ◆For ◆ the latest financial market indicators, go to https://www.iol.co.za/businessreport/market-indicators ◆For ◆ the latest quarterly unit trust performance, go to https://www.iol.co.za/ personal-finance/collective-investments ◆To ◆ look up performance of a particular unit trust fund go to https://www.iol.co.za/ personal-finance/fund-look-up