{"id":601984,"date":"2022-07-01T06:56:31","date_gmt":"2022-07-01T04:56:31","guid":{"rendered":"https:\/\/businesstech.co.za\/news\/?p=601984"},"modified":"2022-07-01T06:56:31","modified_gmt":"2022-07-01T04:56:31","slug":"what-if-i-die-young-and-other-crazy-reasons-for-not-saving","status":"publish","type":"post","link":"https:\/\/businesstech.co.za\/news\/industry-news\/601984\/what-if-i-die-young-and-other-crazy-reasons-for-not-saving\/","title":{"rendered":"What if I die young \u2026 and other crazy reasons for not saving"},"content":{"rendered":"<p>South Africans need to stop making excuses and prioritise saving for retirement as early as possible, 10X Investments Senior Investment Consultant Michael Rossouw told Business Tech in an interview.<\/p>\n<ul>\n<li><strong><a href=\"https:\/\/www.10x.co.za\/?utm_source=business%20tech&amp;utm_medium=partnerships&amp;utm_campaign=jul22_bustech_whatif&amp;utm_term=michael%20rossouw&amp;utm_content=retirement%20annuity#home-calculator\" target=\"_blank\" rel=\"noopener\"><strong>Click here to use 10X\u2019s online calculator to create your own customised retirement savings plan<\/strong><\/a><\/strong><\/li>\n<\/ul>\n<p>\u201cOne of the trends I\u2019ve seen with young investors is that they don\u2019t want to save for retirement because, they say, \u2018What if I pass away? I would have been saving for nothing\u2019,\u201d said Rossouw.<\/p>\n<p>\u201cI speak to older people every day who once had the same idea \u2013 and are now stuck without provisions for retirement.\u201d<\/p>\n<p>Rossouw said it is very important to remember that the sooner you begin saving for retirement, the less money you\u2019ll need to contribute overall.<\/p>\n<p>\u201cAssuming a 6% pa real return (after fees and inflation) over the entire period, if someone invested R1,000 per month for 10 years from age 20 to age 30 and then stopped, they would have a larger retirement fund at 65 than someone who invested the same monthly amount for the 35 years from 30 to 65 years old,\u201d said Rossouw.<\/p>\n<div id=\"attachment_602010\" style=\"width: 650px\" class=\"wp-caption aligncenter\"><a  data-lightbox=\"post-image\" href=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2022\/06\/Michael-10-investments-July-2022.jpg\"><img loading=\"lazy\" decoding=\"async\" aria-describedby=\"caption-attachment-602010\" class=\"wp-image-602010 size-full\" src=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2022\/06\/Michael-10-investments-July-2022.jpg\" alt=\"\" width=\"640\" height=\"430\" srcset=\"https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2022\/06\/Michael-10-investments-July-2022.jpg 640w, https:\/\/businesstech.co.za\/news\/wp-content\/uploads\/2022\/06\/Michael-10-investments-July-2022-300x202.jpg 300w\" sizes=\"auto, (max-width: 640px) 100vw, 640px\" \/><\/a><p id=\"caption-attachment-602010\" class=\"wp-caption-text\">10X Investments Senior Investment Consultant Michael Rossouw<\/p><\/div>\n<p>\u201cLooking at it another way,\u201d he added: \u201cIf you start saving at age 25 you can expect to contribute around 25% of your ultimate savings goal, while the market will contribute the other 75%. If you started at 35, you must come up with more than a third; start saving at 40, and you will have to save more than 50% of the total.\u201d<\/p>\n<p>However, Rossouw stresses, it is never too late to begin saving for retirement.<\/p>\n<p>\u201cEven starting a retirement annuity five or ten years before your retirement you get the market to do some of the work for you.\u201d<\/p>\n<h3 class=\"my-4\"><strong>Passive vs Active<\/strong><\/h3>\n<p>Rossouw said that a key consideration when starting a retirement fund was deciding whether to choose an active or passive investment option.<\/p>\n<p>Passive retirement funds give you the average return from a section within the entire market (called an index of stocks), effectively allowing you to buy a slice of the market. Active funds, on the other hand, select particular stocks that they predict will outperform (but could just as easily under-perform).<\/p>\n<p>\u201cWhile active funds sound fantastic in theory, this is not necessarily the case in reality,\u201d said Rossouw.<\/p>\n<p>10X Investments has completed thousands of reports comparing prospective clients\u2019 current retirement funds (largely active funds) and the passive ones offered by 10X Investments. In my experience, the passive funds generated higher returns more than 80% of the time.<\/p>\n<p><strong><a href=\"https:\/\/www.10x.co.za\/campaign\/fee-comparison?utm_source=business%20tech&amp;utm_medium=partnerships&amp;utm_campaign=jul_bustech_whatif&amp;utm_term=michael%20rossouw&amp;utm_content=retirement%20annuity\" target=\"_blank\" rel=\"noopener\"><strong>Ask 10X Investments to do a free, no obligation fee analysis and cost comparison on your current retirement savings policy<\/strong><\/a><\/strong><\/p>\n<p>\u201cIf the probability of success for an active fund manager is just 20%, it is worrying that the majority of retirement funds in South Africa are actively managed,\u201d Rossouw said.<\/p>\n<h3 class=\"my-4\"><strong>Educated investors<\/strong><\/h3>\n<p>Thankfully, South African investors are becoming more educated, said Rossouw.<\/p>\n<p>\u201cWe are happy to see more that customers approaching us are more knowledgeable than in the past, and we try to educate them further,\u201d he said.<\/p>\n<p>One area that 10X Investments focuses its education on is investment fees.<\/p>\n<p>\u201cFull disclosure of these costs is often difficult to access if you don\u2019t know what to ask for,\u201d said Rossouw.<\/p>\n<p>\u201cThis is why we tell people to ask for the Effective Annual Cost (EAC), as this helps you to understand what you are paying in total.\u201d<\/p>\n<p>10X Investments prides itself on offering low fees as this maximises the profits for its customers.<\/p>\n<p>\u201cWe charge low fees, meaning that our clients make the most money possible,\u201d said Rossouw.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>South Africans need to stop making excuses and prioritise saving for retirement as early as possible, 10X Investments Senior Investment Consultant Michael Rossouw told Business Tech in an interview. <\/p>\n","protected":false},"author":57,"featured_media":602006,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[10459],"tags":[11953],"class_list":["post-601984","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-industry-news","tag-10x-investments"],"_links":{"self":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/601984","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/users\/57"}],"replies":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/comments?post=601984"}],"version-history":[{"count":6,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/601984\/revisions"}],"predecessor-version":[{"id":601992,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/posts\/601984\/revisions\/601992"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media\/602006"}],"wp:attachment":[{"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/media?parent=601984"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/categories?post=601984"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/businesstech.co.za\/news\/wp-json\/wp\/v2\/tags?post=601984"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}