While both life and living annuities are designed to provide retirees with an income throughout retirement, their respective functions in the context of estate planning are vastly different – and it’s important for policyholders to understand these differences to ensure that one’s estate planning goals can be achieved. In this article, we unpack how each type of annuity is dealt with upon the death of the policyholder. What are the key differences between living and life annuities? The first point of departure is to understand the fundamental differences between a life annuity and a living ann ..read more

When setting up your business, deciding between a sole proprietorship, partnership, or private company is crucial, each carrying distinct pros and cons. Picking the right structure for your venture demands careful evaluation. Factors to weigh include: Key features: If you’re planning a one-person business, you may consider running a sole proprietorship which is the simplest form of business entity that involves very little administration – although note that a sole proprietorship is not a legal entity and does not exist separately from the owner. In the case of multiple business partners, the ..read more

Creating an estate plan is essential if you intend to leave assets to minor children. In this article, we take a closer look at how you can safeguard the intended inheritance for minor children taking into account the type of assets, beneficiary nominations, trust options and associated legislation. Bequeathing fixed property When it comes to leaving immoveable property to a minor child, our law makes provision for minor children to own inherited property and to take transfer thereof with the assistance of their legal guardian. This means that if you bequeath fixed property to a minor child, t ..read more

Navigating the world of property and property finance for the first time can be daunting, especially when it comes to applying for finance and securing the most favourable interest rate. In this article, we provide some useful advice for first-time home buyers. Use technology to your advantage: Technological advancements have made shopping for your first home so much easier than in the recent past. Most reputable estate agents now operate interactive websites that allow potential buyers to conduct virtual tours of each marketed property, access 360-degree photos of each room, and filter the pr ..read more

Determining the estate duty liability in your estate is a critical part of the planning process as it allows the estate planner to put mechanisms in place to address any shortfalls that may exist. In terms of legislation, no tax is payable by a beneficiary on assets received as an inheritance – whether through testate or intestate succession. This is because an inherited asset is regarded as a capital receipt and is not included in a taxpayer’s gross income. As such, inheritance tax – which we refer to as estate duty – is paid by the deceased estate before any assets are transferred to the ben ..read more

Putting financial solutions in place should be part of a carefully designed strategy. Each solution or product should serve a pre-determined purpose in your wealth creation strategy. As US investment guru Peter Lynch is famous for saying: ‘Know what you own and why you own it’. Here, we explore the mechanisms of seven financial solutions, who needs them, and what to know before implementing. 1. Retirement annuity How does it work? Retirement annuities are effectively personal retirement funds held in the name of an individual. As in the case of provident and pension funds, retirement annuities ..read more

According to research, large age-gap marriages have a greater chance of failing because each spouse is generally at a different life stage psychologically, emotionally, and financially. These complex family dynamics give rise to a special set of financial planning considerations which should be considered as early in the relationship as possible. Risk cover When it comes to risk cover, the age and health status of the older spouse may impact his insurability. If the older spouse wants to make financial provision for his younger spouse through a life policy, obtaining cover may be both challeng ..read more

As sole breadwinners responsible for the welfare of minor children, single mothers face a particularly daunting set of challenges when it comes to financial planning. Besides not having a partner’s income as a safety net, the emotional strain of shouldering the family’s finances alone can leave many single mothers feeling overburdened and financially strained. From our experience, however, single mothers have a special type of resilience and resourcefulness when it comes to managing their finances. Research shows that women make better investors because they are more likely to seek advice, sti ..read more

The sooner your start your financial planning journey, the better the outcomes are likely to be. Here are twenty steps you can take in your twenties that can set your finances up for life: Set up a budget Budgeting is habit forming, and learning to use a budget early on in your career will help create excellent money habits for the rest of your life. Remember, while you are young, single, and your finances are relatively uncomplicated, budgeting will be a fairly simple exercise. As your personal circumstances change and become more complex, so too will your budget. Our advice is therefore to ..read more

Numerous studies have demonstrated a cyclical link between financial worries and mental health problems such as depression, anxiety, and substance abuse – with higher rates of mental health issues appearing in those who are heavily indebted. In this article, we explore a number of factors that can cause sleepless nights when it comes to money and finances: Debt Debt is probably the single greatest stressor when it comes to financial planning and, unfortunately, very few South Africans are immune to torments of debt, especially in an inflationary environment. Over the past two years, the countr ..read more