How Much It Cost Us To Emigrate To The UK

The most expensive flight of my life

Now that the dust has finally settled on our move to the UK, and most of the whirlwind of admin that goes with packing up and moving to a new country (and then thrown in for good measure – a new job, a new house and new schools, all while in the middle of a global pandemic) things are finally starting to go back to some semblance of normality.

How To Calculate Real Returns (For Real)

Real returns - better than fake ones. 

We need to get real. Realistically speaking, as much as we would really like to keep all of the return our investments generate, the reality is inflation secretly steals some of that return.

Okay that was really bad! Doh! Oops, I did it again!

Right, let’s try that again…

How Long To Financial Freedom?

It's got nothing to do with how much
you earn

So you want to be financially free? Of course you do, who doesn’t!

Okay, so the next question you probably asking is how long is that going to take you?

Well that depends on how much you earn, right? The more you earn, the faster you can become rich, and the faster you can tell your boss what you really think of Hawaiian shirt day. Right?

School Fees: Is The Upfront Discount Worth It?

As if they teach anything personal
finance at school...

Next year we will find ourselves at a parenting milestone which is both terrifying and really exciting! Stealthy Junior will officially be starting school.

It also means we win ourselves the grand prize of around 14 years worth of school fees to pay, starting January 2020.

Fun times for Junior, not so fun for our budget.

Compound Interest Works Better Without A Financial Adviser

Hey, hands off my money!

Yeah, yeah, we all know the drill. Start early, be consistent, give it time, and then allow the jet fuel known as compound interest to blow your socks off. The legend is indeed true - compound interest is a really powerful force which can do wonders for a financial freedom dream (or any other long term financial goal).

But what if I told you there was a way to make compound interest even more powerful – compounding your compounding as it were?

What's Your Financial Freedom Percentage?

A cheesy retirement stock photo. 

Whilst early retirement may not be for everyone, financial freedom is something we are all going to have to achieve.

Unless your retirement plan consists of living off your children, or seeing how many cans of baked beans you can buy with a SASSA grant (the answer is around 150), you are going to need to become financially free by the time you stop working.

Money Bunnies - A Compound Interest Calculator

If only I could think of a good analogy
 for compound interest... 

A calculation which each and every person should run (at least once a year) is to work out how much they need to be financially free. The problem is, the number this calculation spits out is often terrifying! You may be left wondering how on earth you will ever get to the 7 or 8 digits required?

This may lead you to end your quest for financial freedom then and there, because the number seems more demotivating than inspirational. 

If only there was a way for money to multiply like bunnies...

Do You Know Your Inflation Rate?

The inflation monster - hungry for
your money! 

It’s a gripe people have had ever since I can remember - the official South African Inflation Number does not accurately reflect the actual inflation people experience. And I guess it is a fair point.

The way the inflation number is calculated, is by keeping track of a number of items in an imaginary "inflation basket". Every month Stats SA checks the total cost of that basket and releases this number as the CPI (Consumer Price Index). The change in CPI is then pretty much what we call the inflation rate.

Is 86c Expensive?

Who remembers these?

A while back I listed the ETF’s with the highest Total Expense Ratios (TER) in a post on my Facebook page. The most expensive one came in with a TER of 0.86%.

Someone commented on the post asking what a TER was, and so I explained the concept and used an example which equated to saying you pay around 86c per R100 you have invested every year. Someone else then commented saying that that is really not bad if we consider that to be expensive.

I Love Capital Gains Tax

Said no one...ever!

If all goes according to plan, I will be financially free in around 12 years from now.

The idea is that, at this point, I will be able to cover my living expenses by drawing an income from my investments.

This income could come from a number of sources including (but possibly not limited to):

How To Become A Millionaire - It's Easier Than You Think

I guess that's one way of doing it! 

Ah yes, the magical 7 figures. The stuff dreams are made of!

Being able to call yourself a millionaire is something that many aspire to (or at least those who aren't there yet!) And it is definitely something worth aiming for because, as they say, the first million is the hardest!

So practically speaking - is it possible for someone to become a millionaire, and how long will it take to get there?

Why TER Trumps Brokerage

Did someone say Trump? 

If, like me, you subscribe to the "buy low cost index trackers and wait" investment school of thought, you will already be well drilled in the importance of keeping fees low. In short, lower fees mean better returns.

So when I heard some market commentators becoming very vocal about the lower upfront costs of investing in an index tracking Unit Trust compared to an index tracking ETF, it definitely got my attention.

So I got out my spade, and started digging.

Reader Question - Trade In My Car For A Cheaper One?

This may or may not be the car in question.

Someone got in touch with me with a car related dilemma. I was glad he didn't say that his cambelt timing had resulted in increased wear on his cylinder heads (is that even a thing?) - because I am definitely not the right person to ask about that.

His was more a question of whether it made financial sense to trade in his newly purchased car for a cheaper one.

Now that type of question I can give my 2c on...

2016 In Numbers

2016 - soooo last year

Happy New Year everybody! I trust you had a fantastic festive season and are ready for 2017!

This is a bit of an "off topic" post - before looking forward to the new year, I thought I would be fun to first look back at the now "old year" and present some interesting 2016 numbers from the blog (well interesting to me anyways). All the numbers below are as at 31 December 2016.

House Price Growth In South Africa

Going up?

I recently looked at the historical Investment Returns of Equities and Bonds. But there are of course many other asset classes which you can throw your money at. So I thought I would take a look at another option which you may have considered or be considering - Residential Property. Some people swear by it, some people swear at it!

Investment Rules of Thumb

Opposable thumbs - not just for
Facebook likes. 

In a recent article I detailed the investment returns and inflation rates I expect going forward (I also made a handy lookup page for these values). And now that I have that information I can run some calculations and generate some "rules of thumb" to use as a quick estimation to calculate investment figures.

I found this exercise interesting, and it clearly illustrates the power that time can have on your investment. But I also found it to be a great motivating factor to invest more, because the power of compound interest gives some very impressive numbers!

Inflation Rates and Investment Returns in South Africa

Girlfriends Inflation can be a real
drag on your investment goals

There are a number of factors to take into account when it comes to Investing. The first big one is "What investment returns can I expect?" and the other big one is "What is the inflation rate"? These two numbers can have a massive effect on the time it takes you to reach your investment goal. So for us there are a few questions to ask:

1 - What is the inflation rate in South Africa?
2 - What are the investment returns in South Africa?
3 - What are these values going forward?

Lets investigate.....