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 The Sharenet Daily 
Wednesday, 26 February 2014 - 20:00
Top News
SA Business
Company News
Company Results
World Markets (Spot Prices)
JSE Today
JSE Trading Statistics
Major Moves
Index Summary
Latest Consensus Changes / Results Expected
Recent Dividends / Ex Div
Upcoming AGMs
Stock Exchange News Service (SENS)

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Seed Weekly - Making Retirement Annuities Work

We’ve all heard the line ‘remember the tax benefits of investing in a Retirement Annuity (RA)’ somewhere before. This is true but doesn’t quite explain how you are supposed to approach your investment in an RA. The most obvious benefit is that you can contribute 15% of your income, after contributions to pension and provident funds have been deducted, to your RA and deduct this from your gross taxable income. This is a great tool to reduce you tax burden. Another benefit to investing through RA’s is that no Capital Gains Taxes (CGT) are levied on switches made between funds, a massive benefit if you have a long time before retirement. The downside of RA’s is that only 1/3rd can be taken as a lump sum at retirement while the balance needs to be invested into either an investment linked living annuity (ILLA) or a guaranteed annuity from which an income has to be drawn. This income from the annuity is taxed according to the income tax table.

In a previous article I mentioned that income from discretionary investments are in most cases taxed at a lower rate than annuities but are only more tax efficient after retirement. Investors are therefore left with the headache of choosing how to make best use of the various vehicles available to them to reach certain financial goals.

The reason why discretionary assets tend to last longer when you start drawing an income after retirement is because the tax benefit remains within the investment. This is not always the case when building up a retirement annuity, the tax deductible benefit is more often than not consumed instead of being invested. Consuming the tax benefit of your RA will lead to reduced benefits available, compared to what could have been achieved had a similar investment been made of a discretionary nature. To show the massive impact this would have on your assets consider an example of a 45 year old person who has 20 years to go to retirement, has R 6 000 a month to invest and earns R 750 000 per year. If he/she doesn’t contribute to a pension/provident fund R 112 500 can be contributed to a RA per annum and then deducted from taxable income. According to some basic calculations R 6 000 a month into an RA results in a tax saving of R 28 759 per annum. If this tax saving is not invested the below graph shows a possible future value of the investment in real terms:

The value estimated through Seed’s retirement calculation tool is +- R 2 500 000.

Now if the extra R 28 759 is invested annually into the existing RA the below graph shows the benefit that can be attained:

The difference estimated is a massive R 1 million, or 40% more for the investor that reinvested the tax benefit received.

The charts above should be used as a reference to show the possible downside of consuming the tax benefit of your RA. It should also serve as a reminder to ‘top up your RA’ and be disciplined in your approach to building assets. The best way to stay on track is to get a long term advisor who can help you navigate through the pitfalls and opportunities on your journey to financial freedom.

Kind regards,

Stefan Keeve

021 914 4966

Wed, 26 Feb 2014
Top News
South Africa's rand was weaker against the dollar on Wednesday after Finance Minister Pravin Gordhan presented the 2014 budget to parliament and as emerging market currencies came under pressure.  Full story

South African stocks recovered on Wednesday, as resource stocks such as petrochemical group Sasol and mining company Assore were lifted by the weaker rand and short-term insurer Santam gained on a surprise rise in earnings.  Full story
President Vladimir Putin put 150,000 Russian combat troops on high alert for war games near Ukraine on Wednesday, the Kremlin's boldest gesture yet after days of sabre rattling since its ally Viktor Yanukovich was toppled as president in Kiev.  Full story
A former chief editor of a major Hong Kong newspaper known for its critical reporting was stabbed and seriously wounded on Wednesday in an attack that has fuelled concerns about what many see as an erosion of media freedoms.  Full story
Shots fired by unknown gunmen on Wednesday rattled parts of the Thai capital where anti-government protesters have set up camp for weeks, with small but occasionally deadly bombs and gunfire fast becoming the new norm in the city.  Full story
European stocks dipped on Wednesday, taking a breather from their sharp three-week rally, with shares in luxury goods makers under renewed pressure due. . .  Full story
Gold fell 1 percent on Wednesday, retreating from a four-month high, as a dollar rally and surging U.S. new home sales dented. . .  Full story
Analyst cuts prompted a rush to the exits for investors in retailer Tesco, weighing on the blue-chip FTSE 100 on Wednesday and dragging. . .  Full story
World stocks markets were flat on Wednesday as worries about some emerging markets grew as the Russian ruble hit a five-year low as. . .  Full story

U.S. stocks were mostly flat on Wednesday as, for a third straight session, equities were unable to hold onto gains that took the. . .  Full story
U.S. stocks opened slightly higher on Wednesday led by consumer shares after results from Target and Lowe's, with the S&P 500 once more. . .  Full story
Hong Kong shares rebounded from their lowest in more than a week on Wednesday, thanks to gains by Chinese oil majors on state-owned. . .  Full story
China shares ended a four-day losing streak, as gains by oil giant Sinopec offset losses for financials as the yuan again fell below. . .  Full story
SA Business
South Africa trimmed budget deficit forecasts for the next financial year on Wednesday, vowing to keep spending in check even as. . .  Full story
South Africa will delay the introduction of a carbon tax by one year to 2016, tweaking its policies to better protect. . .  Full story
South Africa cut its budget deficit forecasts on Wednesday, predicting a 4.0 percent spending gap for 2014/15, lower than market expectations. . .  Full story
South African pharmaceutical firm Adcock Ingram Holdings appointed Brian Joffe as chairman on Wednesday, a widely expected move after the industrial. . .  Full story

South African short-term insurer Santam on Wednesday reported a surprise 4 percent increase in full-year earnings after booking a record level. . .  Full story
South African transport group Imperial Holdings Ltd gave a bleak 2014 profit outlook on Wednesday, saying it would be difficult to. . .  Full story
South Africa plans to raise $1.5 billion a year in capital markets over the next three years, and is confident of. . .  Full story
Ecobank chief executive Thierry Tanoh has failed to raise any capital, bring stability or extract efficiencies, according to board member Daniel. . .  Full story

South African power utility Eskom sold a total of 250 million rand of its ES42 straight bond and its EL30 inflation-linked bond on Wednesday, the company said in a statement.. . .  Full story
Spanish renewable energy firm Acciona has hired Lazard to find a buyer for up to 49 pct of its wind power assets outside Spain in a push to raise capital, a source with knowledge. . .  Full story
A key Ecobank board meeting at the bank's headquarters in Togo on Tuesday was blocked by an injunction filed by an individual shareholder at a court in the capital Lome, bank. . .  Full story
World Markets (Spot Prices)
NameTimeRPMove% Move
JSE Overall17:0047017.1960.440.13%
JSE Top 4017:0042535.9593.400.22%
JSE Gold17:001473.66-46.50-3.06%
JSE Financial17:0032873.26-49.38-0.15%
JSE Industrial17:0061187.70181.660.30%
JSE Indust 2517:0054134.66214.160.40%
JSE Resource17:0056125.0120.360.04%
DJ Futures19:5216215.0023.000.14%
DJ Ind19:5816233.6153.950.33%
SP 50019:581851.166.040.33%
FTSE 10018:356799.15-31.35-0.46%
All Ords07:395447.003.000.06%
NZSE 5006:504973.205.690.11%
NameTimeRPMove% Move
Gold $19:591328.90-11.50-0.86%
Gold R19:5914400.8315.440.11%
Gold R/kg19:5846302613100.28%
Silver $19:5921.3100-.5480-2.51%
Platinum $19:591426.50-7.50-0.52%
Palladium $19:59729.75-2.25-0.31%
Brent Crude19:58109.61-1.03-0.93%
Rand / Dollar19:5910.83600.10560.98%
Rand / Pound19:5518.00760.14270.80%
Rand / Euro19:5514.81980.07110.48%
Rand / NZD19:598.98810.05280.59%
Rand / AUD19:559.71480.03740.39%
Yen / Dollar19:59102.55700.35300.35%
Euro / Dollar19:590.73150.00390.54%
Dollar / Euro19:591.3671-0.0074-0.54%
Pound / Dollar19:550.60080.00150.25%

Click here for the Sharenet Spot Price page
The JSE Today

Trading Statistics
* Includes all listed instruments on the JSE
Major Moves Up
SharenameSaleMove% MoveVolume
1 KEATON   2904016.00.%135121
2 CAMAC  89011014.10.%8155
3 GOLIATH  2503013.64.%3000
4 YORK  3904011.43.%3000
5 ONELOGIX  3703510.45.%109500
6 DIGICOR  2202010.00.%961523
7 AMECOR  295176.12.%3000
8 ASPEN  2770014195.40.%2917591
9 ANNUITY  530254.95.%5374
10 COMAIR  430204.88.%10144
11 S-OCEAN  13064.84.%23429
12 CALGRO  687314.73.%40256
13 ITLTILE  805303.87.%1240
14 AVENG  2254743.39.%847914
15 CAT  1756512.99.%65599
16 CROOKES  72002012.87.%25
17 SANTAM  169204712.86.%73801
18 PSG  90502362.68.%12620
19 RIPLC  888232.66.%638085
20 REINET  2346602.62.%7555016

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Major Moves Down
SharenameSaleMove% MoveVolume
1 NET1UEPS  9150-1850-16.82.%98
2 SEARDEL  199-36-15.32.%118500
3 CSG  226-19-7.76.%28600
4 EHSV  1550-125-7.46.%43950
5 PHUMELELA  1800-95-5.01.%5266
6 IMPLATS  11200-578-4.91.%2937290
7 HARMONY  3438-174-4.82.%1208926
8 ARCMITTAL  4022-193-4.58.%554625
9 IMPERIAL  16075-714-4.25.%3563931
10 GFIELDS  4024-162-3.87.%2054435
11 MRHLD  2525-95-3.63.%367501
12 TORRE  270-10-3.57.%19814
13 METROFILE  506-18-3.44.%37700
14 METMAR  175-6-3.31.%28867
15 CLIENTELE  1450-49-3.27.%2742
16 ANGGOLD  18940-622-3.18.%901892
17 ROLFES  440-14-3.08.%55183
18 OASIS  1340-40-2.90.%13432
19 RCL  1376-41-2.89.%357428
20 OCEANA  8160-240-2.86.%60210

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New Highs
SharenameSaleHighMove% MoveVolume
1 COMAIR  430430204.88.%10144
2 CROOKES  720072002012.87.%25
3 REINET  23462360602.62.%7555016
4 STEINHOFF  50425085521.04.%9519085

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New Lows
SharenameSaleLowMove% MoveVolume
1 ROLFES  440440-14-3.08.%55183
2 RCL  13761302-41-2.89.%357428
3 SHOPRIT  1367013601-383-2.73.%3576646
4 ASCENDIS  948910-10-1.04.%75405
5 CBH  2852020.97840
6 SANTAM  16920160004712.86.%73801

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Index Summary
Index NameRPMove% Move
Top 4042,535.9593.400.22%
Mid Cap57,699.17-243.91-0.42%
Small Cap50,737.95-81.59-0.16%
Resource 2056,125.0120.360.04%
Industrial 2554,134.66214.160.40%
Financial 1512,605.90-25.32-0.20%
Financial & Ind. 3057,197.89158.360.28%
All Share47,017.1960.440.13%
Oil & Gas 41,620.25708.311.73%
Mining 33,888.96-130.49-0.38%
Gold Mining1,473.66-46.50-3.06%
Platinum Mining48.09-1.33-2.69%
GENERAL MINING9,868.3924.550.25%
Oil & Gas Producers 22,378.44380.851.73%
Basic Materials 30,005.78-109.02-0.36%
Chemicals 24,258.61-152.12-0.62%
Forestry & Paper 31,182.88167.830.54%
Industrial Metals 23,932.33-536.40-2.19%
Industrials 41,341.10-51.03-0.12%
General Industrials 127.71.660.52%
Consumer Goods 56,934.98382.780.68%
Automobiles & Parts 10,088.1645.290.45%
Household Goods342.7141.04%
Health Care 73,567.961595.172.22%
Beverages 177.792.671.52%
Index NameRPMove% Move
Food Producers 63,185.39-883.00-1.38%
Personal Goods 1,
Consumer Services 11,523.47-31.37-0.27%
General Retailers 54,177.85-130.38-0.24%
Travel & Leisure 5,373.00-6.80-0.13%
Support Services 2,650.74-102.95-3.74%
Telecommunications 9,378.47-20.45-0.22%
Financials 32,873.26-49.38-0.15%
Banks 55,433.00-819.43-1.46%
Non-life Insurance 43,183.581202.102.86%
Life Insurance 31,870.70163.910.52%
General Financial 3,233.592.660.08%
Technology 42,298.6142.440.10%
SHARIAH TOP40 4,075.30110.26%
FTSE/JSE SHARIAH ALL4,163.3750.11%
COAL MINING18,204.13-324-1.75%
FTSE JSE Fledgling 6,486.89-1-0.01%
FTSE/JSE Alt X 1,167.34-9-0.75%
RESOURCE 30,675.91-5-0.02%
DIVIDEND PLUS204.67-0-0.22%
FTSE/JSE RAFI 409,307.9730.04%
Capped Top 4022,458.55470.21%
Capped All Share23,789.28300.13%
JSE TABACO 7,327.94881.21%

Click here for the Sharenet Index Summary page
Latest Consensus Changes**
CodeCompany NameStatusUpdated
Results Expected**
ExpectedCompany NameFin. Date
27/02/2014BATSDecember 2013 (Final)
27/02/2014BIDVESTDecember 2013 (Interim)
27/02/2014GRINDRODDecember 2013 (Final)
27/02/2014GRINDROD PREFDecember 2013 (Final)
27/02/2014GROWPNTDecember 2013 (Interim)

Recent Dividends**
Share NameDec-DateLDTPay-DateAmount
SHOPRIT25/02/1413/03/1424/03/14ZAR 1.3200
AECI25/02/1404/04/1414/04/14ZAR 2.1000
SPANJAARD25/02/1416/05/1426/05/14ZAR 0.1200
CAPCO25/02/1416/05/1419/06/14GBP 0.0100
NEDBANK24/02/1428/03/1407/04/14ZAR 5.0500
Ex Div**
Share NameDec-DateLDTPay-DateAmount
RESILIENT05/02/1421/02/1403/03/14ZAR 1.5959
ASCEN A03/02/1421/02/1403/03/14ZAR 0.1995
ASCEN B03/02/1421/02/1403/03/14ZAR 0.1036
SHOPRIT 6%07/02/1421/02/1403/03/14ZAR 0.0600
SHOPRIT 5%07/02/1421/02/1403/03/14ZAR 0.0500

Upcoming AGMs**
CodeCompany NameDateStatus
CULPCullinan Holdings Ltd.26/02/2014Confirmed
CUP3Cullinan Holdings Ltd.26/02/2014Confirmed
CUP2Cullinan Holdings Ltd.26/02/2014Confirmed
CULCullinan Holdings Ltd.26/02/2014Confirmed
CSGCSG Holdings Ltd.26/02/2014Confirmed

Stock Exchange News Service
26/02/201417:42MICROMEGA HOLDINGS LIMITED - Further Trading Statement
26/02/201417:39TOWER PROPERTY FUND LIMITED - Financial effects and cautionary announcement
26/02/201417:25OLD MUTUAL PLC - Form 8.3 Disclosure
26/02/201417:12EFFICIENT GROUP LIMITED - Dealings in securities by a director of a major subsid...
26/02/201416:54RECM AND CALIBRE LIMITED - Notification of share dealings by associates of direc...
26/02/201416:38TRUWORTHS INTERNATIONAL LIMITED - Dealings in securities
26/02/201416:35CULLINAN HOLDINGS LIMITED - Introduction of Share Option Scheme: Results of Gen...
26/02/201416:30PAN AFRICAN RESOURCES PLC - Dealings in securities
26/02/201416:24FOORD COMPASS LIMITED - Results Of General Meeting, Delisting Timetable And With...
26/02/201416:20CAXTON CTP PUBLISHERS & PRINTERS LD - Cancellation of shares pursuant to the Ele...
26/02/201416:18CULLINAN HOLDINGS LIMITED - Results of Annual General Meeting
26/02/201415:57REBOSIS PROPERTY FUND LIMITED - No change statement and notice of annual general...
26/02/201415:50PROTECH KHUTHELE HOLDINGS LIMITED - Dealings in securities by an executive direc...
26/02/201415:40TRENCOR LIMITED - Reviewed Results for the year ended 31 December 2013 and decla...
26/02/201415:25MURRAY & ROBERTS HOLDINGS LIMITED - Change in Company Secretary
26/02/201415:10SHOPRITE HOLDINGS LIMITED - Dealings in securities by director of main subsidiar...
26/02/201414:41INDWA INVESTMENTS LIMITED - New Instrument Listing-INA422
26/02/201414:40SANTAM LIMITED - Audited Financial Results for the Year Ended 31 December 2013
26/02/201414:31IVUZI INVESTMENTS LIMITED - Listing of Tap Issue-IVA422
26/02/201414:20ESOR LIMITED - Change to the Board - Resignation
26/02/201414:17NEDBANK LIMITED - Interim Dividend - SHPNII
26/02/201414:15AFRICAN AND OVERSEAS ENTERPRISES LD - Posting of circular incorporating a notice...
26/02/201413:30METROFILE HOLDINGS LIMITED - Unaudited group results For the six months ended 31...
26/02/201413:17RARE HOLDINGS LIMITED - Trading Statement
26/02/201412:50MORVEST BUSINESS GROUP LIMITED - Interim financial results for the six months en...
26/02/201412:45HOSPITALITY PROPERTY FUND LIMITED - Non-resident withholding tax
26/02/201412:31GOODERSON LEISURE CORPORATION LTD - Voluntary Announcement - Monks Cowl Golf Res...
26/02/201412:10BSI STEEL LIMITED - Dealings in securities by an associate of a director
26/02/201411:55INDWA INVESTMENTS LIMITED - Interest rate reset- IN04Q
26/02/201411:30CURRO HOLDINGS LIMITED - Interest Rate Reset Announcement - COH001
26/02/201411:17INVESTEC BANK LIMITED - Investec Bank Limited- IVC025
26/02/201411:17HOSPITALITY PROPERTY FUND LIMITED - Disclosure of changes in the holding of the ...
26/02/201411:15HOSPITALITY PROPERTY FUND LIMITED - Unaudited Interim Results for the six months...
26/02/201411:00INVESTEC BANK LIMITED - Investec Bank Limited- IVC026
26/02/201410:45TREMATON CAPITAL INVESTMENTS LTD - Dealing in securities by a director
26/02/201410:00TASTE HOLDINGS LIMITED - Change to the Board of Directors - Appointment of Direc...
26/02/201409:38GRINDROD LIMITED - Disposal of Ordinary Shares
26/02/201409:27LITHA HEALTHCARE GROUP LIMITED - Disclosure of significant holding of Litha ordi...
26/02/201408:52RESOURCE GENERATION LIMITED - Final subscription not received from Blumont
26/02/201408:52ILLOVO SUGAR LIMITED - Dealings in Securities
26/02/201408:45ADCOCK INGRAM HOLDINGS LIMITED - Appointment of Chairman and Non-Executive Direc...
26/02/201408:00METAIR INVESTMENTS LIMITED - Update to the MTO Transaction
26/02/201407:05DIGICORE HOLDINGS LIMITED - Group Interim Results For Six Months Ended 31 Decemb...
26/02/201407:05IMPERIAL HOLDINGS LIMITED - Unaudited interim results for the sixmonths ended 31...

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