Samantha Galliet is best known as "that woman who took on Discovery". Diagnosed with breast cancer at 29, Galliet faced a woman’s worst nightmare. She had a particularly aggressive strain of breast cancer called Her2. Fortunately for Galliet there had been a breakthrough in drug therapy for this type of cancer and her chances of survival were dramatically increased by the availability of a new drug called Herceptin.
There is little doubt that there will be a further rate hike when the monetary policy committee meets next week. Inflation numbers have crept up to 5%, a rapid rise since its near-term low in April of 3,7%. Producer price inflation (PPI), which ultimately feeds into consumer inflation, continues to be a major concern, especially as imported capital and raw goods have started to climb as a result of rand weakness.
With the Jali inquiry into banking fees under way and continued pressure on banks by consumer groups and customers, another bank has announced a cut in its banking fees. Nedbank recently announced a 13% reduction in fees and recently launched its bundled pricing option, which saves customers nearly R100 a month based on a typical consumer.
With the JSE reaching new highs, people may be convinced that the good times are here to stay. But in reality there is enough uncertainty in the market to keep investors guessing. The market soared with the JSE All-Share Index breaking 22Â 000, but the rand continues to tumble past R7,60.
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/ 26 September 2006
South African pensioners are now able to convert their homes into retirement annuities without selling their property. Although this product has been available in the United Kingdom, United States and Australia, local banks have taken a while to come to market with a similar product, mostly due to the previously volatile nature of the South African property market.
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/ 25 September 2006
Wizzit, the virtual cellphone bank, has discovered an untapped market in farmworkers. In the past three months, Wizzit has opened 4 000 accounts for farmworkers across 60 farms. The success of Wizzit in tapping this market shows that a focused, small bank can deliver cost-effective banking to low-income earners while delivering superior service to customers.
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/ 8 September 2006
The Receiver’s net is becoming tighter as it works to increase the number of income earners who pay tax. But it may be that in some cases it has overstepped its mark. For example, you may suddenly find that the sale of a property has been held up due to the fact that one of the parties involved — seller, buyer or agent — is not tax compliant.
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/ 4 September 2006
The banks are entering a new price war, one that is very good news for savers and people who rely on interest to meet their monthly bills. As banks come under pressure to find new sources of cash to fund their lending, so they are increasing their deposit interest rates to attract new clients and grow market share.
Lack of legislative clarity has left the life industry and its clients in limbo and set the industry back by up to a year in terms of issues around retirement annuity (RA) penalties. An Old Mutual client’s complaint to ITInews, an online life industry newsletter, highlighted this issue when she said that Old Mutual was refusing to credit her RA policy in accordance with a ruling by the Pension Funds Adjudicator.
There is an email doing the rounds that suggests it is cheaper for a pensioner to live on a cruise liner than in a retirement home. According to the email, the benefits of spending your golden years cruising are substantial. Apart from having all your meals prepared for you, and even served breakfast in bed if you want, you are treated like a customer and not a patient.
Access to credit has never been easier, with banks falling over themselves to provide credit to customers. But remember, next time you get a call from a bank to tell you about pre-approved credit, be sceptical. It may tell you that you can afford it, but only you know what you can afford to repay.
There was a time when you had to have collateral before a bank was prepared to give you a business loan. With their risk covered, their job was done. However, banks now view business loans very differently. According to Riaan Fouche, head of franchising at First National Bank, five years ago banks flipped through the credit-application document, looked at what security you could offer and only then considered the concept of the business you were buying.
The latest unit trust figures show that tracker or passive funds have outperformed the actively managed funds over the past two years. With so much investment choice out there and concerns over the impact of costs in a low-inflation environment, investors looking for a simple equity investment with low costs could consider an index tracking fund such as the JSE’s Satrix securities.
There is a sentiment among retail investors that socially responsible investing (SRI) is rather like a charity — you don’t get the same returns as a "normal" investment. Performance figures, however, prove that you can have a conscience and make money.
Recently, Standard Bank’s economics division released an update on its residential property gauge. House-price rises slowed from 6,5% in June to 6% in July, the lowest growth rate since December 2002, and the bank believes the slowdown in property price growth is now entrenched.
The typical life-stage-cycle approach to investments is that in your 20s you have a maximum exposure to equities, which reduces over time as you get closer to retirement. By the time you retire at 60, your pension should have no equities and be fully invested in cash and bonds with no risk.
A retail development bond could be the perfect vehicle to develop South African small and micro-business and low-income housing while, at the same time, providing retail investors with market-related returns. Although socially responsible investing is well understood in South Africa there is an enormous gap in funding available for projects under R3-million.
With share prices of listed property collapsing by 20% on the back of the rate hike in June and fears of future rate hikes, retail investors bailed out of the sector, according to the latest figures from the Association of Collective Investments. For the quarter ending June, investors were net sellers of unit trust real estate funds to the tune of R500-million.
Fica is a four-letter word for anyone who has had financial dealings in the past three years. Consumers have had to provide certified copies of a set of documents for each account with every financial institution, the information required varying between institutions.
We have a peculiar set-up in South Africa when it comes to buying a house. Buyers and sellers are represented by the same agent, who is incentivised purely by the sale of the property at the highest price. This makes it impossible for an estate agent to act in the best interests of the buyer.
No one expected the interest rate hike last month, and certainly not the rand and market fallout that followed. If you had been reading the press, there had been concerns around the price of the stock market and the fact that the rand was looking vulnerable as the current account deficit continued to balloon.
Most people purchase a home or a car on credit as these are big-ticket items that are difficult to save for in advance. Yet for many Muslim South Africans, the traditional method of accessing credit goes against their fundamental belief system. Muslims cannot pay or receive interest, yet this is the basis of banking systems throughout the world, says Edi Patel, CEO of Islamic Finance.
With the 2010 World Cup on the horizon, guesthouses are popping up and offering employment to many South Africans. Across the board, tourism is offering opportunities for small businesses, but being in the people industry can be tough as events beyond your control can affect tourist perceptions.
Richard Branson certainly knows how to shake up the market. Banks have been in a frenzy during the past week, issuing releases and highlighting areas where they are actually cheaper than the Virgin Money offering. It has been quickly pointed out there are credit cards on the market such as Edcon’s and Pick ‘n Pay’s Go Banking, which also have no annual fee.
Last week proved how fast a market can move. It showed that, even if you suspect a correction is likely, when exactly it is going to happen will always be a surprise. On June 5, I investigated options open to investors who were concerned that the market may be facing a major correction, in the region of 15%.
The announcement by First National Bank that it will be paying out R154-million to Saambou customers for incorrect interest calculations by Saambou on their home loans may have homeowners wondering if their bank has overcharged on interest payments. According to Ed Grondel, CEO of FNB Home Loans, the way Saambou calculated the interest on its home loans was out of line with the rest of the banking industry.
A colleague recently calculated that if she had used bundled account pricing on her bank account she would have saved R3Â 500 in bank fees a year. That is a huge sum of money. A survey conducted by Pick ‘n Pay banking shows that, while most people feel their banking fees are too high, many have no idea what those fees are, writes Maya Fisher-French.
The investment approach that is most appropriate for you will be determined by your needs. You may be planning to build up a long-term share portfolio or start a short-term trading portfolio, making money out of short-term moves in the market. These different drivers require different investment strategies.
Your tax return needs to be completed and handed to the South African Revenue Service (Sars) by Friday July 14. This year Sars has launched an initiative that allows individuals and businesses to submit tax returns via the internet. From June 1, you can complete your tax return online.
The pension funds adjudicator has issued another ruling, this time against a preservation fund, the major issue involving the underlying investment in an Old Mutual smooth bonus policy. Like the Alexander Forbes case that saw the company agree to pay out R380-million to pension fund members for not disclosing fees, the issue again boils down to disclosure.
A few years ago the Actuarial Society of South Africa held a seminar on the responsibilities of a pension trustee. At the end of the seminar, when asked who would still be comfortable to take on the role of a pension trustee, not a single hand went up, demonstrating the weighty responsibility that trustees carry, says Magda Wierzycka, CEO of African Harvest Fund Managers.
South African financial institutions could learn a thing or two from innovations abroad that provide for retirement. Many people consider their homes, which they intend to sell on retirement, as their pension. The problem is that downsizing does not necessarily save money as townhouses, clusters or retirement villages often carry a premium price.