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Tuesday, 10 September 2013 - 20:00
Charts
Seed weekly - Financial Planning 101
I was recently asked by a client of mine if we had any pamphlet material outlining the basics of advice for people who have just started working.
I looked around and couldn’t find much that was satisfactory so I have decided to give a brief summary in financial planning 101. Please note that this is an initial guideline and is not meant to be an exhaustive all-encompassing view. If you do understand financial planning, please forward this to somebody who doesn’t.
The back bone of any financial plan and the foundation of financial wellbeing is a budget. If you spend more than you earn you will never be financially independent no matter how much you earn, I have seen people earning R 300 000 per month net with expenses of R 320 000 per month. A budget is the only instrument which can keep your expenses in check, most people underestimate their expenses.
Every person has three basic financial planning needs namely life cover, disability cover and savings.
Life Cover
There are two basic reasons why a person should have life cover, firstly to cover your debts and liabilities, and secondly to cover your future income stream for your dependents. If you have no dependents and no liabilities you don’t need life cover. Your life cover generally goes in a cycle increasing to a point where you have car debt, house debt and the maintenance of 2.5 kids and reducing as the debts reduce and the kids start becoming financially dependent.
Disability
Disability cover is often sold as a lump sum but income protection is probably the most neglected area of financial planning. No matter what your debt/dependent situation is, if you are earning an income you need to ensure that if you cannot work anymore that income will be covered.
Savings
When looking at savings, there are a number of aspects that need to be taken into account. Short term needs (holidays, large expenses such as car tyres etc.) Medium term savings (saving for a deposit on a house, kids tuition fees etc.) and Long Term savings needs (Retirement). Whilst the numbers may vary it is an indisputable fact that most South African’s cannot retire at anywhere near the lifestyle they had before retirement. Compound interest is an incredibly powerful force and most people who can retire comfortably can do so because they started saving very early in their working lives. It is important that you start early enough and that you save enough. It is pointless putting away R 150 per month starting at the age of 20 but not increasing that amount. I often get asked how much money is needed to retire. This is a very difficult as each person has different income needs, but if you want to retire at the age of 60 a general rule of thumb is that you will need investable capital of 25 times your annual net income needs.
A will is a very important document that will only be used once. If you have any assets you need to have a will. Whilst most people hate thinking about their death a Will is an integral part of any decent financial plan.
The most important thing about being financially dependent is to have a plan, this plan will include a realistic budget, enough life cover (not too much) the right income protection and a properly managed portfolio of short, medium and long term investments. Most people do not have the time or inclination to set up this plan so it is important to have a reputable trustworthy financial advisor to help you achieve your goals. Should you have any further questions, please don’t hesitate to contact me.
Kind regards,
Barry Hugo
www.seedinvestments.co.za
info@seedinvestments.co.za
021 914 4966
Top News
![[IMAGE]](image.php@width=300&height=150&cropratio=2%253A1&image=%252Fnewsimages%252F2013-09-10T113822Z_1_AJOE9890WC100_RTROPTP_3_OZABS-SAFRICA-GOLDFIELDS-20130910.JPG "A Gold Fields Mine company logo is seen outside the South Deep Gold mine") South African bullion producer Gold Fields said on Tuesday it was being investigated by the U.S. Securities and Exchange Commission over a $210 million black empowerment deal involving a senior member of the ruling party. Full story ![[IMAGE]](image.php@width=300&height=150&cropratio=2%253A1&image=http%253A%252F%252Fwww.sharenet.co.za%252Fimages%252Fprofile%252Fsteinhoff.gif) Revenue grew by 44% to R115.5 billion (R80.1 billion). Operating profit before capital items jumped by 41% to R11.3 billion (R8 billion). EBITDA improved 39% R11 billion (R7.9billion). Net attributable profit was up 29% to R7.3 billion (R5.7 billion). In addition, headline earnings per ordin Full story |
 Syria accepted a
Russian proposal on Tuesday to give up chemical weapons and win
a reprieve from U.S. military strikes, while its jets returned
to the sky to bomb rebel positions in Damascus for the first
time since the West threatened force. Full story  Syria accepted a Russian proposal on Tuesday to give up chemical weapons and win a reprieve from U.S. military strikes, while its jets returned to the sky to bomb rebel positions in Damascus for the first time since the West threatened force. Full story  Top Obama administration
officials urged Congress on Tuesday to keep the pressure on
Syria over its chemical weapons arsenal while the United States
explores a diplomatic alternative to military strikes. Full story |
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Markets |
U.S. stocks rose on Tuesday,
with the S&P 500 on track for a sixth straight session of gains
as an alternative solution emerged. . . Full story |
U.S. stocks climbed for a
sixth straight session on Tuesday as the dollar and global
equities rallied on more upbeat economic data from. . . Full story |
European shares rallied to a
3-1/2 month high on Tuesday as equities globally rose on signs
that a U.S. strike on Syria, with. . . Full story |
Britain's main share index rose
to its highest level in nearly a month on Tuesday, bolstered by
the outlines of an international compromise. . . Full story | |||
European shares rallied to
retest their August high on Tuesday as equities globally were
lifted by signs that a U.S. strike on Syria,. . . Full story |
Gold fell 2 percent on Tuesday
after Syria accepted a Russian proposal to give up chemical
weapons to avert a U.S. strike.. . . Full story |
Europe's financial companies are
expected to lead a rise in stock market dividends over the next
four years and insurers are best placed. . . Full story |
U.S. stocks rose at the open
on Tuesday, putting the S&P 500 on track for a sixth day of
gains, following further upbeat. . . Full story | ||||
SA Business |
South Africa's Eskom said on Tuesday power will remain tight during the southern hemisphere summer period as it increases maintenance work. . . Full story |
South Africa's top construction firm, Aveng Ltd, reported a drop in full-year profit on Tuesday, hit by weakness in its domestic. . . Full story |
Growth in spending in South Africa slowed to an annualised 2.7 percent in the second quarter of 2013 from 3.5 percent. . . Full story |
South Africa's current account deficit widened more than expected to 6.5 percent of GDP in the second quarter of 2013 from. . . Full story | |||
South African bullion
producer Gold Fields said on Tuesday it was being
investigated by the U.S. Securities and Exchange Commission over
a $210 million. . . Full story | South Africa's Kagiso Media said on Tuesday its top shareholder had offered to buy out the remaining stake in the company. . . Full story | South African furniture retailer Steinhoff International on Tuesday reported a 25 percent increase in earnings, bolstered by rand weakness against the. . . Full story | South Africa's FirstRand, Africa's second-largest lender by stock market value, said it has a $1 billion kitty to pursue an expansion. . . Full story |
South Africa's Treasury sold a total 2.35 billion rand of its 2023, 2031 and 2037 government bonds on Tuesday.. . . Full story | South Africa's rand weakened against the dollar early on Tuesday as investors fretted about upcoming current account data for the second. . . Full story | South Africa sold $2 billion of 12-year paper at a 5.875 percent coupon rate, the Treasury said in a statement on. . . Full story | South Africa's FirstRand posted a 20 percent jump in full-year earnings on Tuesday, propelled by strong growth in loan income and. . . Full story |
Company News |
Kagiso shareholders were advised that, following the release of this firm intention announcement, the cautionary announcement dated 10 June 2013 (and. . . Full story |
Kagiso shareholders were referred to the cautionary announcement released on SENS on 10 June 2013 ("cautionary announcement") and are advised that. . . Full story |
At the annual general meeting of Datatec, held at 14h00 on 10 September 2013, votes were registered for 85% of the. . . Full story |
Keaton Energy announces the following board and committee changes:
*David Salter's short-term assignment as executive chairman has ended and he has returned. . . Full story | |||
Shareholders were referred to the circular dated 2 August 2013 (and using the terms defined therein unless otherwise stated) relating to,. . . Full story |
Shareholders were advised that Mr Norman Axten will be retiring as independent non-executive chairman and director of the group and its. . . Full story |
References in this announcement to R are to South African rand and references to U.S. dollars and are to United States. . . Full story |
PPC will be attending the Exane BNP Paribas's Cement Majors of the Future Investor Conference in London. A presentation, which will. . . Full story | ||||
Company Results | Revenue increased by 11.2% to R9.2 billion (R8.3 billion). Gross profit was up 9.2% to R4.1 billion (R3.8 billion). Operating profit. . . Full story | Revenue for the year increased to R181.3 billion (2012:169.4 billion). Operating profit grew to R40.6 billion (2012: R36.8 billion). Earnings attributable. . . Full story | Revenue increased to R51.7 billion (R40.9 billion). Gross earnings declined to R3.47 billion (R3.49 billion). Net operating earnings rose to R656. . . Full story | Operating loss fell to GBP3.0 million (loss of GBP4.3 million). Loss attributable to equity owners narrowed to GBP2.9 million (loss of. . . Full story |
World Markets (Spot Prices)
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The JSE Today
| Date | Adv. | Decl. | Unch. | Actives | Volume | Value | Trades | Orders |
|---|---|---|---|---|---|---|---|---|
| 10/09/2013 | 239 | 132 | 68 | 439 | 236,998,891 | R16,943,610,492 | 182857 | 1633842 |
| 09/09/2013 | 180 | 159 | 75 | 414 | 187,638,599 | R11,686,837,827 | 138920 | 1487293 |
| 06/09/2013 | 182 | 156 | 85 | 423 | 178,897,441 | R10,685,255,503 | 133588 | 1764716 |
| 05/09/2013 | 218 | 129 | 58 | 405 | 192,254,062 | R10,618,518,359 | 118083 | 1583745 |
| 04/09/2013 | 114 | 235 | 53 | 402 | 172,101,728 | R10,953,239,375 | 136640 | 1152407 |
Major Moves Up
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Index Summary
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Stock Exchange News Service
| Date | Time | Headline |
| 10/09/2013 | 17:50 | GROWTHPOINT PROPERTIES LIMITED - Notice of general meeting, updated timetable, u... |
| 10/09/2013 | 17:45 | LIBERTY HOLDINGS LIMITED - Dealings in securities by the Chief Executive Officer... |
| 10/09/2013 | 17:00 | AFRICAN RAINBOW MINERALS LIMITED - Dealings in ARM securities |
| 10/09/2013 | 17:00 | NETCARE LIMITED - Dealings in securities by director of major subsidiary |
| 10/09/2013 | 16:38 | KAGISO MEDIA LIMITED - Firm intention announcement |
| 10/09/2013 | 16:30 | BLUE LABEL TELECOMS LIMITED - Acceptance of allocated shares in terms of Blue La... |
| 10/09/2013 | 16:30 | WOOLWORTHS HOLDINGS LIMITED - Dealing in securities by a director |
| 10/09/2013 | 16:30 | DATATEC LIMITED - Report on proceedings at annual general meeting |
| 10/09/2013 | 16:15 | GROUP FIVE LIMITED - Dealing in securities by director of a major subsidiary |
| 10/09/2013 | 16:10 | WILDERNESS HOLDINGS LIMITED - Trading statement |
| 10/09/2013 | 16:09 | BAYPORT SECURITISATION (RF) LTD - Finalisation of the Standard & Poors credit ra... |
| 10/09/2013 | 16:07 | BAYPORT SECURITISATION (RF) LTD - Supplement to the Programme Memorandum and Ame... |
| 10/09/2013 | 16:00 | REINET INVESTMENTS S.C.A - Reinet Annual General Meeting of shareholders approve... |
| 10/09/2013 | 15:38 | INGENUITY PROPERTY INVESTMENTS LTD - Conclusion of the purchase of properties |
| 10/09/2013 | 15:35 | JSE LIMITED - GENGeneral-Johannesburg Stock ExchangeAmendments to the JSE Listin... |
| 10/09/2013 | 15:01 | ADCORP HOLDINGS LIMITED - Disposal of securities |
| 10/09/2013 | 14:10 | STEINHOFF INTERNATIONAL HOLDINGS LD - Audited results for the year ended 30 June... |
| 10/09/2013 | 14:05 | KEATON ENERGY HOLDINGS LIMITED - Changes to the board and board committees |
| 10/09/2013 | 13:50 | INVESTEC BANK LIMITED - Dividend announcement - NPNIHB |
| 10/09/2013 | 13:28 | STANDARD BANK OF SOUTH AFRICA LD - SCIB: The Standard Bank Of South Africa Limit... |
| 10/09/2013 | 13:27 | STANDARD BANK OF SOUTH AFRICA LD - CANCELLATION OF S336189 SCIB: The Standard Ba... |
| 10/09/2013 | 13:22 | CITY LODGE HOTELS LIMITED - Director's dealings in securities |
| 10/09/2013 | 13:15 | GOLD FIELDS LIMITED - Gold Fields acknowledges SEC investigation |
| 10/09/2013 | 13:08 | ARB HOLDINGS LIMITED - Dealing in securities by a director of a major subsidiary |
| 10/09/2013 | 13:05 | ARB HOLDINGS LIMITED - Dealing in securities by a director of a major subsidiary |
| 10/09/2013 | 13:00 | OMNIA HOLDINGS LIMITED - Directors Dealings In Securities |
| 10/09/2013 | 12:38 | INVESTEC BANK LIMITED - New Listing VKEIVA- Amendment to Strike Price |
| 10/09/2013 | 12:37 | Investec Bank Limited - Cancellation Of S336127 New Listing- Vkeiva |
| 10/09/2013 | 12:30 | PETMIN LIMITED - Disclosure of beneficial interest in securities |
| 10/09/2013 | 12:30 | INVESTEC BANK LIMITED - Dividend Announcement CFRIHB |
| 10/09/2013 | 11:54 | ANGLO AMERICAN PLC - Anglo American Share Incentive Plan SIP |
| 10/09/2013 | 11:05 | NEDBANK LIMITED - Dividend Distribution - CFRNIE |
| 10/09/2013 | 11:00 | MUSTEK LIMITED - Director dealing in securities |
| 10/09/2013 | 10:39 | TAWANA RESOURCES NL - Notice of ceasing to be a substantial holder |
| 10/09/2013 | 10:35 | RCS INVESTMENT HOLDINGS (PTY) LTD - Interest Rate Reset - RCSC12 |
| 10/09/2013 | 10:25 | STANDARD BANK OF SOUTH AFRICA LD - SCIB: The Standard Bank Of South Africa Limit... |
| 10/09/2013 | 09:06 | COMAIR LIMITED - Audited Group results and cash dividend for the year ended 30 J... |
| 10/09/2013 | 09:00 | SASFIN HOLDINGS LIMITED - Changes to the board |
| 10/09/2013 | 09:00 | CENTRAL RAND GOLD LIMITED - Finalisation Announcement in Respect of the Transfer... |
| 10/09/2013 | 09:00 | MACQUARIE SECURITIES SA (PTY) LTD - New Financial Instrument Listing: MAQ039 |
| 10/09/2013 | 08:59 | SASFIN HOLDINGS LIMITED - CANCELLATION OF S336179 Changes to the board |
| 10/09/2013 | 08:29 | MIX TELEMATICS LIMITED - MiX Telematics announces financial results for the firs... |
| 10/09/2013 | 08:00 | PPC LIMITED - Presentation to Investors |
| 10/09/2013 | 08:00 | AFRICAN EAGLE RESOURCES PLC - Interim Results for the Six Months Ended 30 June 2... |
| 10/09/2013 | 08:00 | FIRSTRAND LIMITED - Audited results and cash dividend declaration for the year e... |
| 10/09/2013 | 08:00 | SASFIN HOLDINGS LIMITED - Changes to the board |
| 10/09/2013 | 08:00 | MERCEDES-BENZ SOUTH AFRICA LIMITED - New Listing |
| 10/09/2013 | 07:30 | AVI LIMITED - Appointment of executive director |
| 10/09/2013 | 07:05 | BRITISH AMERICAN TOBACCO PLC - Transaction in own shares |
| 10/09/2013 | 07:05 | AVENG LIMITED - Audited Group results for the 12 months ended 30 June 2013 |
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