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RETIREMENT UPDATE

Question:

Hi There I have been working for the government for 10 years and I would like to resign ( GEPF) . Is there a way to use some Of my pension and put the rest into a Preservation fund. What % is taxed?

Reply:

Per their rules, you cannot take a portion as cash and preserve the rest. What you can do is transfer the whole amount into a preservation fund. You can then withdraw up to one-third as cash but you must then use the remainder to buy an annuity at retirement. The cash you draw will be taxed as follows: your benefit relating to pre 1 March 1998 is not taxed, the benefit relating to post 31 March 1998 service is taxed per the withdrawal lump sum tax table. The benefit is split on a straight-line basis (pre and post 1 March 1998 service, based on the number of completed years’ service). The withdrawal lump sum tax table is as follows: the first R25,000 is not taxed, the balance to R660,000 is taxed at 18%, the balance to R990,000 at 27% and the remainder at 36%. This will happen in any case at retirement.

Getting more.. By making the correct preservation and investment decision you can get up to 15% more for a limited time only.

Get in contact and let’s assist you today!

If risk is like a smoldering coal that may spark a fire at any moment, then insurance is our fire extinguisher.

Countries and their citizens need something to spread risk among large numbers of people and to move risk to entities that can handle it. This is how insurance emerged. Read on to learn about how insurance evolved and how it can work to protect you from being burned by risk.

King Hammurabi's Code
The main concept of insurance - that of spreading risk - has been around as long as human existence. Whether it was hunting giant elk in a group to spread the risk of being the one gored to death or shipping cargo in several different caravans to avoid losing the whole shipment to a marauding tribe, people have always been wary of risk.

The first written insurance policy appeared in ancient times on a Babylonian obelisk monument with the code of King Hammurabi carved into it. The "Hammurabi Code" was one of the first forms of written laws. These ancient laws were extreme in most respects, but it offered basic insurance in that a debtor didn't have to pay back his loans if some personal catastrophe made it impossible (disability, death, flooding, etc.).

Guild Coverage
In the dark and middle ages, most craftsmen were trained through the guild system. Apprentices spent their childhoods working for masters for little or no pay. Once they became masters themselves, they paid dues to the guild and trained their own apprentices. The wealthier guilds had large coffers that acted as a type of insurance fund. If a master's practice burned down, a common occurrence in the wooden hovels of medieval Europe, the guild would rebuild it using money from its coffers. If a master were robbed, the guild would cover his obligations until money started to flow in again. If a master were suddenly disabled or killed, the guild would support him or his widow and family. This safety net encouraged more and more people to leave farming and take up trades. As a result, the amount of goods available for trade increased, as did the range of goods and services available. The style of insurance used by guilds is still around today in the form of "group coverage". (To discover the basics to insurance, see Understand Your Insurance Contract and Life Insurance Clauses Determine Your Coverage.)

Dangerous Waters
The practice of underwriting emerged in the same London coffeehouses that operated as the unofficial stock exchange for the British Empire. In the late 1600s, shipping was just beginning between the New World and the old as colonies were being established and exotic goods were ferried back. A coffeehouse owned by Edward Lloyd, later of Lloyd's of London, was the primary meeting place for merchants, ship owners and others seeking insurance. (To read more about the history of the stock exchange, see The Stock Market: A Look Back and The Birth Of Stock Exchanges.)

A basic system for funding voyages to the new world was established. In the first stage, merchants and companies would seek funding from venture capitalists. The venture capitalists would help find people who wanted to be colonists, usually those from the more desperate areas of London, and would purchase provisions for the voyage. In exchange, the venture capitalists would be guaranteed some of the returns from the goods the colonists would produce or find in the Americas. It was widely believed that you couldn't take two left turns in America without finding a deposit of gold or other precious metals. When it turned out that this wasn't exactly true, venture capitalists still funded voyages for a share of the new bumper crop: tobacco.

After the voyage was secured by venture capitalists, the merchants and ship owners would go to Lloyd's and hand over a copy of the ship's cargo to be read to the investors and underwriters who gathered there. The people interested in taking on the risk for a set premium would sign at the bottom of the manifest beneath the figure indicating what share of the cargo they were taking responsibility for (hence, underwriting). In this way, a single voyage would have multiple underwriters, who would try to spread their risk as well by taking shares in several different voyages.

By 1654, Blaise Pascal, the Frenchman who gave us the first calculator, and his countryman Pierre de Fermat discovered a way to express probabilities and, thereby, understand levels of risk. Pascal's triangle led to the first actuary tables that were, and still are, used when calculating insurance rates. These formalized the practice of underwriting and made insurance more affordable.

Fire and Plague
In 1666, the great fire of London destroyed around 14,000 buildings. London was still recovering from the plague had that ravaged it a year earlier, and many survivors found themselves without homes. As a response to the chaos and outrage that followed the burning of London, groups of underwriters who had dealt exclusively in marine insurance formed insurance companies that offered fire insurance. Armed with Pascal's triangle, these companies quickly expanded their range of business. By 1693, the first mortality table was created using Pascal's triangle and life insurance soon followed. (To keep reading about insurance, see Fifteen Insurance Policies You Don't Need, Five Insurance Policies Everyone Should Have and How Much Life Insurance Should You Carry?)

The Slow Exodus to America
Insurance companies thrived in Europe, especially after the industrial revolution. In America, the story was very different. Colonists' lives were fraught with dangers that no insurance company would touch. As a result of lack food, wars with indigenous people and disease, almost three out of every four colonists died in the first 40 years of settlement. It took more than 100 years for insurance to establish itself in America. When it finally did, it brought the maturity in both practice and policies that developed during that same period of time in Europe.

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 With all our exciting services at hand it is undertandable you want to tell the world. Not a problem and we will through in a holiday for you and a voucher for your friends.
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MODERN INVESTMENTS

 

 New look at investments

   The investment arena has one constant, change! Lets take a look at opportunities in todays investment arena.
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INNOVATIVE INSURANCE

 

The good and the bad

We take a look at the origin of insurance and how it evolved to where it is in our modern era. What has gone wrong and how you should vote with your wallet.
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Estate Planning

Will Estate Taxes force the sale of my business? What are my duties as executor and trustee? Does my spouse know where I've been storing our records? How can I turn my success into a lasting legacy What will happen to my children when they get access to their trusts. Find Out more

Best small and medium business practices

Learn Pro's Best Secrets Over the past decade we researched the best business practices and now share with you the findings. We realise the economical value of small and medium businesses have on our communities and would like to contribute.

There are many books and stories of all the great successfull entrepreneurs, but we look at the business on a daily basis.

It is important to choose the correct structures and set up the best modules for success and lower the risk we may or may not be aware of.

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