In the past women…
Used to be…
•
Housewives
•
Mothers
•
Caretakers
But today…
Women equal to:
•
52% of the SA population
and make up ..
•
39% of the workforce
of which
•
51% are in professional and technical positions
•
68% are black professionals
•
47% have all managerial, political, professional and executive
positions
And only…
•
34% of retirement annuities…
•
43% of life policies…
•
38% of endowments/savings products…
•
27% of funeral policies…
•
17% of short-term cover…
•
15% of medical insurance..
are owned by women
Remember that…
•
Women live longer than men
•
6% retire financially independent
•
Dual income families need two pensions
•
Women need to break career paths to raise children
•
Medical costs escalate specially at retirement
•
Inflation halves the buying power/value of your money every 8
years (rule 72: divide 72 by current inflation rate= every x year
value of money halves)
More sobering thoughts… Inflation
Buying power of money is decreasing - Make provision
2002
2012
R13.95
R37.99
COKE CAN 6pack
2002
2012
R3.61
R12.22
PETROL/liter
INCREASE
INCREASE
172%
239%
2002
R58.95
2012
2002
2012
R144.95
R21.99
R63.99
CASTLE LAGER 24
RICOFFY 750g
INCREASE
INCREASE
146%
191%
More sobering thoughts… Inflation
Buying power of money is decreasing - Make provision
2002
2012
2002
2012
R26.99
R53.99
R5.59
R17.49
SKIP WASHING POWDER 2kg
IWISA MAIZE MEAL
INCREASE
INCREASE
100%
213%
2002
2012
R4.75
R11.99
LAYS CHIPS 125g
INCREASE
152%
2002
R4 800
2012
R14 100
HIGH SCHOOL FEES/year
(GREY GOLLEGE BLOEMFONTEIN)
INCREASE
194%
More sobering thoughts… Inflation
Buying power of money is decreasing - Make provision
2002
2012
R7 590
R15 000
*THREE-BEDROOM HOUSE
DOUBLE GARAGE, SWIMMING
POOL IN NEWLANDS CT
(monthly rental)
INCREASE
60%
2002
2012
R95 750
R158 900
FORDIKON
INCREASE
66%
The truth is…
•
50% of marriages end in divorce
•
50% of women over 65 are widowed or divorced
•
Women suffer dread diseases earlier and more frequently than
ever before
•
Life policies are often ceded to creditors
More sobering thoughts…
•
Most working people dream about a carefree retirement in the future.
Reality is quite different for most who reach retirement
•
Research over a long period indicates that, out of every 100 South
Africans who work, the situation at age 65 would probably be as follows:
- 49 will be dependent on the state or family
- 29 would have died
- 12 will be bankrupt
- 5 will still be working
- 4 will be able to retire comfortably
- 1 will be wealthy
More sobering thoughts...
•
Salary cheques left
Age
25
480
35
360
45
240
55
120
Historical Hysterical realities?
•
The “Cinderella” syndrome -“Someone will rescue me!”
•
The “It won’t happen to me” syndrome
Have you ever pictured your life if…
•
Your husband dies, his business is in trouble and all the policies are
ceded to the bank?
•
He is retrenched and his group life cover falls away?
•
He has no policies and is now uninsurable?
•
You’re divorced, he dies and you have to compete with his new family
for maintenance?
•
You wanted a divorce but couldn’t afford an attorney?
•
If he retires earlier than expected?
•
If he dies without a will?
Women are from Venus
Surveys reveal
• Men’s major fear in old age is loneliness
• Women’s is poverty
Getting started
•
Make the decision to take control
•
Find an intermediary you trust
•
Tackle debt
•
Prepare and stick to a budget
What you are entitled to from your intermediary
•
Trust and mutual respect
•
Analysis of your financial status
•
Discussion of personal and financial goals
•
Written recommendations
•
Agreement on plan
•
Annual review
You are not alone in the debt trap
•
South Africans are deep in debt
•
130 000 people receive summonses every month
for defaulting on debt
•
Nearly 12% of the workforce can expect to have
debt judgments against them
•
The Reserve Bank puts household debt at 51%
of household income
Budgeting is a family affair
Three steps
•
Where are we now?
- What does your spouse/partner earn?
- Gross earnings vs “Take home” pay
•
What are we going to change?
•
Discipline. Dedication. Control
A balanced financial plan
A balanced financial plan
Protection
Death
Disability
Creation of wealth
Medical
cover
Dread
disease
Savings &
Investment
Retirement
Employer
Own
Pension/
Provident
Retirement
annuity
After tax savings
A balanced financial plan
A balanced financial plan
Protection
Death
Disability
Creation of wealth
Medical
cover
Dread
disease
Savings &
Investment
Retirement
Employer
Own
Pension/
Provident
Retirement
annuity
After tax savings
Protection
•
Death
- Afford any debts and costs of untimely death
•
Disability
- Ensure you can survive any loss of income
•
Medical cover
- Hospital and doctors’ costs
•
Dread disease
- Surviving dread disease
Dread disease
•
Heart disease
- 25% of women will suffer from cardiovascular disease
before age 60
•
Cancer
- 1 in 7 women will develop cancer
The good news is…
•
Heart disease
- 80% of heart attack patients survive
•
Cancer
- 50% are alive 5 years after diagnosis
•
Stroke
- 1950: survival rate 11%
- Today: 75%
The cost of surviving
•
1/3 = direct medical costs
•
2/3 = indirect expenses including
- Home or car modifications
- Alternative medicines or treatments
- Patient, spouse and caregiver’s loss of income
- Rehabilitation e.g. Physio
- Reconstruction and prosthetics
A balanced financial plan
A balanced financial plan
Protection
Death
Disability
Creation of wealth
Medical
cover
Dread
disease
Savings &
Investment
Retirement
Employer
Own
Pension/
Provident
Retirement
annuity
After tax savings
Savings and investments
•
Emergency fund
•
“Celebration of Life” fund
•
Education fund
•
Long-term growth fund
Cost of delay
Regular contribution R500 pm – starting at different
ages, will grow to age 65, assuming a 10% pa net
investment return
5,000,000
4,500,000
4,000,000
3,500,000
3,000,000
2,500,000
2,000,000
1,500,000
1,000,000
500,000
0
Retirement savings - the cost of delay
20
25
30
35
40
45
50
55
60
65
Starting age
Money at the end
•
“Having money left at the end of your life is no
problem, having life left at the end of your
money is.”
- Samuel Baldwin
Imagine if…
•
•
•
•
•
•
You had your own policies on his life
You had your own disability cover
You had your own dread disease cover
You contribute to a retirement fund and supplement any
shortfall
You had a nest egg for education
You had an emergency fund
The rest of your life
•
“Take care of the future. It is where you will
spend the rest of your life.”
- Charles Kettering