POLOKWANE – With the ongoing economic challenges, including the postponement of the budget speech and fluctuations in the US economy, terms like stocks, bonds, and saving money can often become confusing for many individuals.

Ryan Gilbert, the regional manager at Carrick-Wealth, visited the city last week to host a seminar on strategies to elevate personal wealth in the face of these complexities.

He said that South Africans do not need to limit their investments to the local Rand, as exchange controls in South Africa are highly favourable to its citizens.

He highlighted that South Africa remains relatively stable compared to other regions on the continent, but the risk premium that South Africans once accepted is no longer applicable.

“The risk premium that South Africans used to have and accept no longer exists,” Gilbert explained.

He noted that foreign investors are no longer taking the risk of putting their money into developing markets, as the risks often outweigh the potential rewards. Instead, it’s becoming more advantageous to invest in stable economies outside the country.

A key part of his advice was the possibility for South Africans to set up international retirement plans that function similarly to local trusts, but with added advantages.

“An offshore trust provides the same protective benefits as a domestic trust but without the 20% donation tax typically associated with transferring assets into a South African trust,” Gilbert explained.

Furthermore, Gilbert said that South African residents can now access mortgages in the UK, with the potential to borrow up to two-thirds of the property’s value.

“An interest-only mortgage means paying only the interest, which is typically 5% of the property value. The capital and interest method involves monthly payments towards the property until it is fully owned,” he explained.

When it comes to protecting a business, Gilbert outlined three crucial pillars:

1. Protect individual shareholders: Ensuring that in the event of a stakeholder’s death, there are sufficient funds for the remaining stakeholders to buy the deceased’s shares from their family.

2. Protect intellectual property: Key persons, such as specialists or top salespeople, who significantly contribute to a company’s revenue should be insured to mitigate potential business disruption if they leave or pass away.

3. Protect the balance sheet: In cases where business partners lend money to the business, it’s vital to have a policy on the partners’ lives to cover the loan value in case of death.