Why Are More People Building ‘Career Insurance’?

“Every day I’m hustlin’.” (Rick Ross)

When you reach the middle arc of your career, two almost contradictory things happen. Between the ages of 35 and 55, you are often at the peak of your career and earning capability. Yet, at the same time, many South Africans of this age group experience a persistent undercurrent of anxiety.

It’s not difficult to understand why. This is what financial planners call the “peak responsibility phase.” You may be simultaneously managing a home loan, funding your children’s education, maintaining medical aid premiums, and perhaps even supporting aging parents.

In short, you are earning as well as you ever will, but your financial obligations are as high as they will ever be. There is simply no room for error.

This is why research into mid-career professionals shows that many are anxious about what would happen if they suddenly lost their jobs or fell chronically ill. When so many lives depend on your ability to generate a monthly salary, relying on a single corporate paycheck can begin to feel like a significant risk.

The shift

This is why we are seeing a profound shift in how secondary incomes are viewed. A generation ago, a “side hustle” was seen either as a passion project or a sign of financial distress. Today, for the mid-career professional, it’s becoming something entirely different: a form of ‘career insurance’.

In other words, earning multiple income streams has become a form of risk mitigation. This is not a replacement for formal insurance products, but a complement to them.

A good analogy would be diversification in investing. You would never put your entire investment portfolio into a single stock, because if that company failed it would be financially catastrophic for you. Similarly, professionals today are increasingly reluctant to invest 100% of their human capital with a single employer.

A secondary income stream acts as a hedge against events like corporate restructuring, industry volatility, and economic downturns that could cost you your job. If you lose your primary income, having a pre-established secondary channel – even a modest one – ensures you do not have to immediately deplete your long-term retirement savings or emergency funds to cover baseline living expenses.

Low-risk, high-leverage

Of course, this isn’t as simple as it sounds. For a professional with a demanding corporate role and family commitments, time is the scarcest commodity. You cannot afford to risk too much capital or spend 30 hours a week on a side hustle. The goal is low-risk, high-leverage diversification.

The most effective mid-career hedges therefore leverage the intellectual property you have spent decades acquiring. This often takes the form of “fractional” or advisory work, such as:

Advisory and consulting: Offering specialised strategic advice to non-competing businesses or startups outside of your standard working hours.
Mentorship and training: Conducting workshops or lecturing within your industry.

By monetising your existing expertise, you are protecting your capital and preserving your limited time.

Navigating the practicalities

While the psychological peace of mind provided by ‘career insurance’ is invaluable, executing it successfully requires careful coordination, particularly regarding time and taxes.

From a tax perspective, it is important to remember that any income earned in your personal capacity from a secondary source is added to your primary salary. This means it will be taxed at your current marginal tax rate, which for this demographic often sits between 36% and 41%. Failing to plan for this can lead to an unexpected and stressful liability when filing your annual provisional returns with SARS.

Furthermore, ‘career insurance’ should never come at the expense of your health or your primary employment. It’s designed to mitigate anxiety, not create burnout.

Building a robust financial moat requires a balance between income generation, your overall wellbeing and structured wealth protection. If you are considering establishing a secondary income stream to safeguard your family’s future, it’s well worth having a conversation with your financial adviser. Together, we can work out a way to structure this income efficiently, manage the tax implications, and ensure that your ‘career insurance’ works in perfect harmony with your broader, long-term wealth strategy.

Disclaimer: The information provided herein should not be used or relied on as professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact us for specific and detailed advice.

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When Risk No Longer Feels Risky

“The investor’s chief problem, and even his worst enemy, is likely to be himself.” (Benjamin Graham)

A different conversation

One of the privileges of working with clients over many years is noticing how their questions evolve. A decade ago, most conversations about investing centred on protecting wealth from the next financial crisis. Today, we find ourselves hearing something rather different. Increasingly, clients are asking whether they’re being too cautious.

It’s a change, for sure. Investors have already been through the Global Financial Crisis, Brexit, a pandemic, soaring inflation, sharply higher interest rates, wars, trade disputes and, most recently, uncertainty about artificial intelligence. Every crisis seemed to arrive with the same message: this time would be different. But businesses adapted, economies adjusted, and markets recovered through periods of severe volatility. Those investors who remained disciplined were generally rewarded for their patience.

That is exactly what long-term investing is supposed to achieve. It’s also prompted us to wonder whether repeated recoveries have quietly changed something else: not the markets themselves, but the way many of us think about risk.

The danger of familiarity

Increasingly, clients have been asking whether they are being too conservative. Their reasoning is difficult to fault. Every major setback has eventually become another reminder that markets recover. If markets are able to absorb almost everything eventually, do we still need quite so much in bonds and cash?

Psychologists have studied this behaviour for decades. They call it recency bias: our tendency to believe that recent experience is the best guide to the future. Closely related is normalisation bias, where repeated exposure to the same event gradually makes it feel ordinary rather than exceptional.

It’s not that investors suddenly get aggressive. Usually, the change is much more subtle. Diversification starts to seem like overkill. Holding cash doesn’t seem efficient. Defensive assets seem to detract from returns rather than shield wealth. Unconsciously, we start to read the uncertainty of the future through the prism of recent success.

The markets haven’t become less risky, we’ve become more familiar with risk. Those are two very different things.

History has a longer memory

History offers reasons for both confidence and humility. Diversified markets have repeatedly demonstrated remarkable resilience over long periods, rewarding investors who remained committed to their plans. At the same time, no two crises unfold in quite the same way. The banking crisis of 2008 was very different from the pandemic, which was very different from the inflation shock that followed. Today’s uncertainties, ranging from geopolitical fragmentation to artificial intelligence, will present challenges of their own.

Every crisis introduces itself as something the world has never seen before. History usually takes a more balanced view. It reminds us that recoveries are rarely predictable, comfortable or identical to those that came before. Respecting that uncertainty is very different from fearing it.

The behaviour gap

One of the more sobering findings in investment research is that markets don’t always disappoint investors; investors often disappoint themselves. For decades, independent research house DALBAR has tracked the returns earned by investment funds against the returns actually achieved by the people invested in those funds. The gap is surprisingly persistent, and the explanation has very little to do with poor investment selection. Instead, it reflects a very human tendency to allow emotions to influence decisions. Investors often become most optimistic after markets have already risen and most cautious after they have already fallen, buying when confidence is high and selling when fear takes hold.

The lesson is a simple and very uncomfortable one. Behaving well is as important as picking the right portfolio when it comes to long-term investment success. Markets have proven time and time again that they can bounce back from periods of uncertainty. But investors don’t always stay invested long enough to see those recoveries play out.

Perspective is the real value

That’s where good financial advice comes in. We can’t predict the next crisis or say when markets will come back. But we can provide perspective when recent experience is distorting judgement.

Financial planning has never been about predicting tomorrow’s headlines. It’s always been about ensuring tomorrow’s headlines don’t derail today’s well-considered plan. The world will continue to surprise us, but successful investing has never depended on eliminating uncertainty. It’s always been about building portfolios – and the discipline – to withstand it.

If you’d like to discuss anything in this article, please do give us a ring.

Is Private Healthcare Becoming Unaffordable?

“An ounce of prevention is worth a pound of cure.” (Benjamin Franklin)

Every September or October, millions of South Africans perform the same small ritual. An email announces the next year’s medical scheme contribution. It sits unopened for a while, because we know what’s in it. Eventually, we open it, look at the new premium, do a quick calculation in our heads, and ask ourselves the same question as last year. How much longer can this continue?

Something’s changed recently. Clients are no longer saying that their medical scheme is expensive. They’re beginning to wonder whether private healthcare itself is becoming unaffordable.

It’s an understandable concern. Medical scheme contributions have quietly become one of the largest household expenses for many South African families, alongside bond repayments, school fees and retirement savings. At the same time, fuel and electricity costs continue to rise, municipal bills don’t get any cheaper, grocery prices seem to edge higher every month, and salaries have generally struggled to keep pace.

When that pressure builds, it’s natural to scrutinise the biggest debit orders. The thing is, not all expenses are created equal. Some payments buy convenience. Others buy enjoyment. A few protect us from financial events that could alter the course of our lives in an instant. Healthcare belongs firmly in this last category.

The drip-drip effect

Medical schemes don’t suddenly become unaffordable because of a single annual increase. They become increasingly difficult to sustain over time, after years of increases that quietly outpace inflation and, in many cases, salary growth.

Medical inflation has always been higher than general inflation. This has meant that medical scheme contributions have always taken an increasing share of household income. The Council for Medical Schemes recommended that contribution increases for 2026 be limited to 3.3% plus reasonable utilisation estimates.But rising claims costs, advances in medical technology, and an ageing membership led many schemes to push through much larger increases.

A family paying R8 000 a month today could realistically be paying well over R17 000 a month in 2036 if annual increases continue at around 8%. Add co-payments, benefit limits, gap cover and the increased healthcare needs that naturally accompany ageing, and it’s easy to understand why so many households are beginning to feel the strain.

For retirees, the pressure is often even higher, with healthcare costs tending to go up just as income from employment vanishes.

Don’t let frustration make the decision

One of the most valuable roles a financial planner can play is helping clients distinguish between an expense that has become uncomfortable and one that has become inappropriate.

Our financial lives evolve. Children become financially independent, mortgages are paid off, retirement arrives, and healthcare needs inevitably change. A medical scheme that suited your circumstances ten years ago may no longer be the best fit today. That doesn’t automatically mean you need less protection. It may simply mean you need a different solution.

In many cases, reviewing your hospital benefits, network providers, gap cover, and options can make things more affordable without exposing you to unnecessary financial risk. The key is to make those decisions consciously, rather than allowing another annual premium hike to make them for you.

What about the NHI?

As if rising healthcare costs weren’t enough, South Africans are also trying to make sense of the National Health Insurance (NHI) landscape.

Many practical questions remain unanswered. How quickly will it be implemented? How will it be funded? What role will private medical schemes ultimately play? Those questions are likely to remain part of the national conversation for some time.

For families sitting around the kitchen table trying to balance next month’s budget, however, those debates are irrelevant. Whatever South Africa’s healthcare system looks like in ten years, your family still needs appropriate protection today.

A quiet tipping point

Affordability matters for another reason. South Africa already has a relatively small proportion of its population belonging to medical schemes. According to the Council for Medical Schemes, around 9.13 million South Africans (roughly 15% of the population) are members.

Medical schemes require a healthy mix of young and old members. As more and more younger families are priced out of private healthcare, the pool of risk shrinks, costs are shared by fewer and affordability suffers even more.

Looking beyond the monthly debit order

Medical scheme contributions are far more than another monthly debit order. They influence retirement planning, emergency reserves, investment decisions and, ultimately, your family’s long-term financial resilience. That’s why healthcare funding should never be considered in isolation.

The objective isn’t to encourage every client to choose the most comprehensive medical scheme available, nor to suggest that every increase should be accepted without question.

Rather, it’s about making informed, intentional decisions that balance affordability with appropriate protection.

Let’s have the conversation

Many people think they have only two choices: absorb the latest increase or cancel their cover.

But this is a massive oversimplification. A different medical scheme option may provide better value. Adjustments elsewhere in your financial plan may create room to accommodate rising healthcare costs. And sometimes, after a thorough review, you’ll discover that your current cover remains the most appropriate choice.

If the rising cost of healthcare is beginning to place pressure on your household budget, speak to us before making changes to your medical scheme.

Market Update: Why Markets Keep Finding Their Way Back to the Same Place

“Plus ça change, plus c’est la même chose.” / “The more things change, the more they stay the same.” (Jean-Baptiste Alphonse Karr, 1849)

It’s rare for the news cycle to be as eventful as it has been this year, yet matter so little in determining where asset prices actually end up. Since the start of the year, investors have lived through a war that has reignited and a ceasefire that has collapsed more than once. The result? Maximum drama and minimal lasting market impact.

Headline risk is at its highest levels in decades. Yet if you look at where the S&P 500, global equities, and world growth forecasts actually stand today, the picture looks strikingly familiar to how it did months ago.

The ceasefire that wasn’t (and the rally that was)

The US-Iran conflict has swung between war and truce all year. By mid-July, Washington and Iran had declared the ceasefire over. And yet US equities have barely moved off course, instead continuing to toy with record highs. The pattern is becoming as familiar as Groundhog Day:

A crisis erupts and dominates the headlines.
Markets dip briefly, then decide the worst-case scenario is unlikely to be priced in for any meaningful period.
The situation deteriorates on the ground, but by then, positioning has already moved on.

The IMF’s “crosscurrents”: War shock meets AI tailwind

The IMF’s July World Economic Outlook Update captured these tensions in its title alone: “Global Economy in Crosscurrents of War and Technology.” The Outlook projected global growth at 3.0% for 2026 and 3.4% for 2027, broadly unchanged, on a cumulative basis, from April’s forecast, despite months of conflict headlines since then. It highlighted the following global drivers:

The war shock, which is weighing on energy importers.
AI-driven demand, which is lifting AI-driven economies.

In essence, these two forces are roughly cancelling each other out. For now.

Why the destination hasn’t changed

US corporate earnings, particularly in technology and AI infrastructure, are reducing portfolio risk. The S&P 500 closed at 7 572 in mid-July, within striking distance of its 2026 highs.

Meanwhile, in South Africa, investors experienced a familiar mix of outcomes and risks. The FTSE/JSE All Share Index closed at 109 683 on 22 July, down modestly over the past month but still 9.49% higher than a year ago. The domestic policy backdrop is itself a study in “plus ça change”, with the SARB holding its repo rate at 7% after May’s pre-emptive hike, despite the upside surprise in June inflation, which came in at 5.0%.

What to do while the headlines spin

The temptation is to trade every headline. However, history suggests a steadier approach:

Separate headline risk from fundamental risk and remain anchored to earnings quality.
Respect the AI-versus-war crosscurrent within the IMF’s macroeconomic lens.
Watch both the rand and oil prices, as they inform the direction of local returns.

None of this warrants complacency, with investment portfolios still vulnerable to a genuine escalation or disintegration in the positive AI capex cycle. But for now, expect more of the same if fundamentals remain intact.

*All facts and figures accurate at time of writing.

The Highest Return on Investment May Not Be Financial

“The only ones among you who will be truly happy are those who have sought and found how to serve.” (Albert Schweitzer)

It’s a profound observation from a man who dedicated his life to medicine, philosophy and humanitarian work. Long before researchers began studying the relationship between generosity and wellbeing, some of history’s greatest thinkers understood that human fulfilment comes not only from achievement and personal progress, but also from feeling connected to something beyond ourselves.

For most of our lives, we are taught to think of investment in terms of accumulation. We save diligently, invest carefully and make decisions today in the hope that our future selves will enjoy greater security, freedom and choice. There is wisdom in this approach, and it remains the foundation of responsible financial planning.

Yet there is another form of investment that has fascinated philosophers, psychologists and social scientists for centuries. One where the return is not measured in percentages, market movements or portfolio values, but in a deeper sense of purpose, connection and personal fulfilment.

That investment is generosity.

Hedonic adaptation and the “new normal”

There’s no denying the importance of financial security. Money can remove many of life’s practical burdens, provide independence and open doors that may otherwise remain closed.

However, most people who have experienced an improvement in their circumstances recognise how quickly a new level of comfort can become familiar. The cavernous mansion eventually feels like home. The sparkling Lamborghini becomes simply the car you drive every day. The purchase that once represented a milestone quietly becomes part of ordinary life.

Psychologists refer to this phenomenon as hedonic adaptation: our remarkable ability to become accustomed to improved circumstances and establish a new normal.

Giving typically follows a different emotional pattern. Whether it’s helping a student access an education, sharing expertise with a young entrepreneur, supporting an environmental initiative, or offering time to someone who needs it, generosity creates a connection between our resources and another person’s possibilities.

It reminds us that some of our greatest assets are not those we keep, but those we use to create opportunities for others.

A human trait, not a wealth category

One of the greatest misconceptions about charitable giving is that it is reserved for those with extraordinary financial means.

In reality, generosity has always taken many different forms. A student may have little money to give but they can still offer time, enthusiasm and energy. A professional may open doors for somebody beginning their career. Parents may involve children in choosing a cause to support, teaching lessons about empathy and responsibility that will shape their values for decades.

Later in life, many people discover that their most valuable asset is not necessarily the wealth they have accumulated, but the wisdom they have gained. Years of experience, mistakes, resilience and professional knowledge can become an extraordinary gift when shared with younger generations, entrepreneurs or community organisations.

The returns that don’t appear on a statement

The rewards that come from being generous may never be reflected in a financial statement, but they are often felt just as deeply by the person who gives as by the person who receives.

A simple act of generosity can spark a chain reaction whose effects travel far from where it began. A scholarship can change the future of a young person who may one day be a mentor or benefactor to someone else. Sometimes a conversation can give someone the confidence to pursue an opportunity they would otherwise have passed up. A community project can create opportunities for people who may never know the name of the person who started the project.

The most remarkable aspect of generosity is that we rarely get to see the full story of what we began. A portfolio statement can tell us exactly what our investments have earned. It cannot tell us how many lives were changed because we chose to share something of ourselves.

Perhaps that’s why generosity is one of the most extraordinary investments you can make on this earth. You may never see the returns on a balance sheet, but they have a way of enriching both the receiver and the giver.

We’d love to chat about how you can incorporate giving in your financial plan.

What Does Financial Planning Look Like if You Don’t Have Kids?

“The privilege of a lifetime is to become who you truly are.” (Carl Jung)

For generations, financial planning was built around a fairly predictable picture of life. People established careers, bought homes, raised children and gradually shifted their attention from building wealth to supporting the next generation. This traditional path remains meaningful for many people, but modern life has become far more varied, and the role we play as your financial planner has evolved alongside it.

Today, some individuals and couples consciously decide that parenthood is not part of the life they wish to create. Others may be childless because circumstances unfolded differently from what they had hoped or expected.

The personal emotions attached to these journeys can be entirely different, yet from a financial planning perspective, they often lead to a similar and fascinating question: if there are no children to inherit your wealth, what do you want your money to do for you during your lifetime, and what story do you want it to tell after you are gone?

The answer is seldom simply a matter of spending more or spending less. Rather, it opens up a much wider conversation about freedom, relationships, security, contribution and the many ways people create meaning in their lives.

Throwing the standard financial timeline out the window

Many of the assumptions that shape traditional financial plans revolve around children. Parents may spend decades planning for school fees, university education, helping their kids enter the property market, or providing financial assistance when life does not unfold as planned.

Without those financial commitments, a different set of possibilities emerges.

Some people choose to use that flexibility to retire earlier, take career risks, travel extensively or pursue interests that would have been difficult with the financial responsibilities of parenthood. Others may continue to build significant wealth and eventually direct it towards nieces and nephews, close friends, charitable causes or institutions that represent their values.

The other side of independence

Many people naturally assume that their children may play some useful role as they grow older, whether that involves helping with practical decisions, navigating healthcare choices, or simply acting as trusted advocates during vulnerable periods. Of course, children are not a retirement strategy, and many families are separated by geography, complex relationships or the demands of their own lives. Nevertheless, the expectation that family may be available often influences the way people think about ageing.

Those without kids often have to face these questions sooner and more deliberately. Who will have the power of attorney? Who knows what you want medically? If you’re no longer able to speak for yourself, who will ensure your financial affairs are managed the way you want?

These are not pessimistic questions. They are the practical foundations of maintaining independence and dignity later in life.

A legacy beyond a family tree

For centuries, the concept of legacy was closely linked to the family line, with wealth, possessions and stories moving from one generation to the next. Yet when we look at the people who have shaped communities, advanced ideas, built organisations or changed individual lives, their impact has often extended far beyond their own descendants.

A teacher may leave a legacy through thousands of students whose futures were shaped by their voice. An entrepreneur may create opportunities for employees and communities. A mentor may pass on decades of experience to someone who would otherwise never have had access to that knowledge.

Financial resources can work in much the same way. They can support research, education, conservation, social causes, extended family or individuals whose lives may be transformed by a single opportunity.

The absence of children does not mean the absence of legacy. It simply invites a more expansive understanding of what legacy can become.

Your life, your financial plan

The most sophisticated financial planning has always been about far more than investment returns, tax strategies and estate documents. At its heart, it’s a conversation about how a person wishes to live, what they value and what they hope their resources will make possible.

For some people, that conversation naturally centres around children and grandchildren. For others, it may centre around personal experiences, lifelong friendships, philanthropy, community or creating security and choice for themselves in later years.

Neither path is richer. Neither path is more meaningful. They are simply different expressions of a life well lived.

Perhaps the most important shift in modern financial planning is recognising that there is no longer a single script that everyone follows. Money is not there to force people into a traditional template. It’s a tool that allows individuals and families to design lives and legacies that reflect who they are.

Market Update: While Wall Street Wobbles, South Africa Gains Momentum

“In the short run, the market is a voting machine. In the long run, it is a weighing machine.” (Benjamin Graham)

In June, the performance gap between the JSE and developed markets narrowed amid positive sentiment, and, for the first time in years, the investment case for South Africa was being made not by local optimists but by global institutional investors.

While global markets had to contend with a sharp technology sell-off, lingering geopolitical uncertainty, and a more hawkish Federal Reserve, South African assets narrowed their relative performance gap on the back of a retreat in stagflation fears and a positive showing in a key institutional investment survey.

Late-month “chipwreck” rattles investor confidence

For much of June, US equities appeared to be having a good month, hitting a new high before a sharp correction in technology shares in the final weeks. The S&P 500 ended the month in the red, thanks largely to a late correction concentrated in semiconductor and AI-adjacent stocks triggered by investor concerns about the scale and sustainability of AI capital expenditure. South Korea’s KOSPI, a strong beneficiary of the AI growth story, fell more than 10% in a single session. The tech sell-off, though potentially short-lived, is a keen reminder of how dependent the US stock market’s performance is on this single narrative.

South Africa: a valuation and sentiment-recovery story

In South Africa, fears of stagflation began to dissipate, and foreign investor sentiment improved. These positive developments haven’t yet been reflected in the JSE All Share Index’s performance, which was negative in June.

However, a Bank of America survey of 14 institutional fund managers found a notable increase in foreign investors’ perceptions of South African assets, with respondents showing the highest level of optimism since 2009. More than 90% of respondents said they were seeing more buying opportunities than selling opportunities in South African equities, and a net 57% of managers were overweight on South African equities.

The positive drivers reflected in the survey are broad-based.

Oil. The single biggest catalyst for South African asset sentiment in June was the decline in oil prices in June. Brent crude fell by close to 30% from its May peak as tensions in the Middle East eased. For South Africa, a net fuel importer, lower oil prices reduce inflation, ease pressure on household budgets, improve the current account, and give the South African Reserve Bank more room to manoeuvre.
Inflation. The stagflation fears that dominated May’s investment narrative have largely dissipated. Net inflation expectations among surveyed fund managers plummeted tenfold, from 75% in May to 7% in June.
Political stability. Investors are assigning a lower political risk premium to South Africa than they did before the 2024 election. The Government of National Unity has broadly held, and while structural challenges remain, the direction of travel looks more predictable than expected. Both South African equities and bonds are benefiting.
Valuation. South African equities trade at significantly lower multiples than their US counterparts. South African government bonds offer some of the highest real yields in the world, and Deutsche Bank forecasts a rand recovery to R16 against the dollar by year-end, supported by the trade balance, restrictive monetary policy and improving political sentiment.

Sustaining SA’s early-stage re-rating

The SARB is widely expected to hike the repo rate in the third quarter, with 100% of surveyed fund managers anticipating a move. That creates a headwind for rate-sensitive assets and could impact sentiment. The rand remains vulnerable to a stronger US dollar, but has managed to hold its sub-R17 level, notwithstanding the ups and downs experienced this year.

The re-rating of South African assets is underpinned by fundamental factors, but remains in its early stages. The true test will be whether the macro conditions that supported June’s sentiment shift (lower oil, fading inflation fears, political stability) hold through the second half of the year.

*All facts and figures accurate at time of writing.

The Ultimate Gift: Maximising Your Child’s TFSA from Day One

“Money makes money. And the money that money makes, makes money.” (Benjamin Franklin)

As investors, it feels like we have a lot to worry about. We want to know which funds are going to perform best. We listen for predictions about whether the US stock market is going to keep running, or if the JSE will outperform it. We wonder what the higher oil price is going to do to our investments.

However, all of these things are really outside of our control. Focusing on them is therefore not the most effective or efficient way to improve investment outcomes.

What is guaranteed to make a difference, however, is something that is often overlooked: the time we give our money to compound. No matter where or how our money is invested, time is ultimately the most important factor in determining how it will grow.

Starting early

There is no better way to think about this than the power of South Africa’s tax-free savings accounts (TFSAs). Originally launched in 2015, government recently raised the annual contribution limit to R46 000 per person.

If you use that allowance wisely, these are one of the most potent wealth-creating tools available to local investors. And if you as a parent or grandparent make contributions into one for a child, the results can be mind-boggling.

Consider what would happen if a TFSA was opened in a child’s name on the day they were born. This has to be done by a parent or legal guardian, but once it’s established, anyone can contribute to it. If their family invested R3 800 for them every month from that moment, this would just about meet the annual limit of R46 000.

Currently, the lifetime limit is R500 000, which you would reach around the time they turned 11. If the investment grows at a reasonable rate of 9% per annum, the TFSA would by that point have increased to R851 000.

The tax-free miracle

It’s what happens from this point that is truly astonishing.

Even if the government never increases the lifetime limit, and so you never add any more to the account, the value of that investment will grow as follows if it is never touched:

By the time the child turns 18, their account will hold R1.5 million.

At age 21, they will have R2.1 million.

When they reach their 30th birthday, they will have R4.7 million.

By the age of 50, the account will have grown to R28 million.

And if they decide to retire at 65, they will have R108 million!

Making a reasonable assumption about inflation, that would be worth around R11.5 million in today’s money.

It gets better

Bear in mind, this is the amount the account would accumulate if the government never increased the lifetime limit. It is, however, not unreasonable to assume that this will happen in future, since the annual limit has already been pushed up twice.

If that happens, and you are able to keep contributing R3 800 per month into the child’s TFSA until the day they turn 18 at a return of 9% per year, they will already have R2 million at that point.

If that investment is never added to or touched again, when they reach 65 it will have grown to R138 million! That would be the equivalent of around R15 million today.

What that means is that if you are able to consistently maximise a child’s TFSA until they turn 18, that would have gone most of the way to funding their retirement. You would have largely taken care of their most important financial imperative.

And that is all due to something entirely within your control: giving that money the maximum amount of time to grow.

Why South Africans Are Better Investors Than We Think

“South Africa is a country where you can lose hope quickly and then find it again just as fast.” (Trevor Noah)

Perfect is never an option

There are days in South Africa when optimism feels less like a personality trait and more like a decision. The headlines can be overwhelming. The economy is unpredictable, politics often feels dramatic, and the rand is shakier than a seagull in a Cape Town storm. Yet despite all of this, South Africans still build businesses, come up with extraordinary ideas, create wealth, emigrate successfully, reinvent themselves when necessary, and somehow keep finding ways forward.

There is probably something important in that. While financial commentators spend endless time analysing interest rates, elections and market cycles, successful investing often comes down to something less measurable: behaviour.

And South Africans tend to possess surprisingly strong investing behaviour.

We’re comfortable with complexity

Spend enough time overseas and certain South African traits become surprisingly obvious.

At the risk of generalisation, South Africans tend to be socially confident people. They speak easily to strangers, integrate quickly into unfamiliar environments, and tend to function relatively well across different cultures and social groups. There’s a flexibility to us Saffers that can be difficult to explain to people raised in more predictable societies.

When circumstances shift here, we adjust because we are accustomed to doing so.

That flexibility matters financially. Markets rarely reward investors who react emotionally every time the environment shifts. Long-term investing requires the ability to withstand periods of discomfort and temporarily disappointing results without abandoning the broader plan altogether.

South Africans have spent much of our lives developing that muscle without even realising it.

The only certainty is … Uncertainty

Investors often imagine that successful wealth creation comes from making perfect decisions at exactly the right time. In reality, most long-term wealth is built imperfectly. People invest during noisy political cycles. They invest through market corrections, recessions, elections, currency weakness and uncomfortable headlines. You can’t press “pause” until conditions become ideal.

South Africans understand this instinctively because waiting for complete certainty here is like banking on the Proteas winning the Cricket World Cup.

For decades, local investors have navigated changing governments, inflation spikes, interest-rate cycles, load shedding, global crises and periods where public sentiment became deeply pessimistic. Yet many of us continued investing steadily throughout those periods.

Obviously, we would have preferred a more positive backdrop. But you can only play the cards you are dealt.

We respect effort

We’re not just good at investing. There’s also something unusually entrepreneurial about South African culture. Perhaps it comes from necessity. Perhaps from history. But South Africans generally admire people who build things. We respect hard work, reinvention and initiative in ways that some societies no longer do openly.

In countries dominated by tall poppy syndrome, visible ambition can sometimes make people uncomfortable. South Africans, by contrast, are often unusually supportive of people who start businesses, pursue opportunities abroad or rebuild after setbacks. That attitude creates a healthier relationship with long-term ambition.

Good investing requires exactly that kind of mindset. Wealth creation is rarely dramatic. More often, it is the gradual result of consistency, discipline and the willingness to continue making sensible decisions day after day.

C is for calm

One of the biggest dangers in investing is emotional overreaction. Investors often damage perfectly good long-term strategies when they become consumed by fear during downturns or overly euphoric during periods of optimism. In the long run, markets tend to punish extreme emotions.

South Africans, for all our frustrations, are often more emotionally balanced than we realise.

We underestimate ourselves financially

The irony is that many South Africans remain surprisingly pessimistic about their own long-term prospects. Maybe it’s because we are so accustomed to hearing about what is broken in our country.

But the facts tell a different story. While poverty remains a huge challenge for much of our population, many middle-class South Africans are improving their financial situations year on year.

For all the frustration that comes with living here, South Africans may possess one of the most underrated investing advantages in the world: the ability to keep moving forward even when conditions don’t feel perfect.

Markets Are Easy to Access. Wisdom Isn’t

“The biggest investing errors come not from factors that are informational or analytical, but from those that are psychological.” (Howard Marks)

Investing has changed significantly over the past decade. What once required a stockbroker, paperwork, and significant capital can now be done in minutes from a smartphone. Millions of people, including South Africans, are investing independently through online platforms, low-cost ETFs, and offshore trading accounts.

In many ways, that’s a positive development. Lower barriers to entry have encouraged more people to take ownership of their financial futures. But accessibility doesn’t guarantee good investment decisions.

The uncomfortable truth is that while entering the investment market has got easier, managing wealth successfully over the long term remains surprisingly difficult. Not because markets are inaccessible, but because human behaviour is complex.

Information overload

One of the biggest risks facing DIY investors today is not a lack of information. It’s the overwhelming abundance of it.

Investors are constantly exposed to financial podcasts, TikTok commentary, YouTube “experts”, Reddit forums, and social media threads confidently predicting what markets will do next. The result is that many people feel highly informed while becoming progressively less disciplined.

There is a significant difference between consuming financial content and building a coherent long-term strategy.

This often leads to what behavioural economists call “herding”: following what appears to be successful without fully understanding the underlying risks. A fund or share that suits one investor’s circumstances may be entirely inappropriate for another’s risk tolerance, time horizon, or tax position.

Easy to buy, harder to build

DIY platforms themselves are not the problem. Many are excellent tools. The challenge is that the interface’s simplicity can be misleading. Buying an investment is easy. Constructing a resilient portfolio is considerably harder.

Many DIY investors unintentionally build portfolios around excitement rather than planning. They accumulate investments one idea at a time – a global ETF here, a technology share there, perhaps some offshore exposure after reading a bullish market article – without considering how the pieces all fit together.

The result can be overlapping holdings, excessive concentration in one sector or geography, duplicated risk, or portfolios that are poorly aligned with long-term financial objectives.

The emotional toll

One of the more subtle dangers of DIY investing is psychological. When investors manage their own portfolios, there is often a temptation to monitor markets constantly and react to every piece of news. Daily market movements begin to feel deeply personal. Activity creates the impression of progress, even when it may be quietly damaging long-term outcomes.

Ironically, some of the strongest investment results historically have come not from constant intervention, but from restraint.

This is where a good financial advisor can add significant value. Not necessarily through dramatic market predictions, but by preventing emotionally driven mistakes. Trying to time the market, panic-selling during volatility, or chasing fashionable investment themes can have a far greater impact on long-term wealth than many investors realise.

Beware the tax man

Tax is another area where DIY investing becomes more complex than many investors initially expect.

Frequent buying and selling may seem harmless, but if investment activity begins to resemble trading rather than long-term investing, the South African Revenue Service may tax profits as income rather than capital gains – potentially resulting in a significantly higher tax rate.

Offshore investing introduces additional complications. Investors who directly own US-listed shares may mistakenly expose their estates to US situs tax upon their death.

While all investors should utilise Tax Free Savings Accounts, many investors don’t understand that excess contributions can trigger considerable tax penalties.

Good advice is often invisible

Perhaps the biggest misconception surrounding financial advice is that its value lies purely in outperforming markets. In reality, much of good financial planning is about helping investors avoid costly mistakes and make better long-term decisions.

A qualified advisor may prevent a client from overexposing themselves to a fashionable investment theme, retiring too aggressively, giving away capital they may later need, or making emotional decisions during periods of uncertainty.

Successful investing is often less about brilliant decisions and more about avoiding damaging ones.

DIY investing can absolutely work for disciplined investors who have the time, temperament, and expertise to manage complexity over the long term. But successful investing requires far more than access to a platform and a few good investment ideas.

It requires patience, structure, emotional discipline, and an understanding that wealth is built not only through returns but through the avoidance of unnecessary mistakes.

Higher-for-Longer: Navigating Inflation, Interest Rate Uncertainty

“Government has been exceptionally able in printing money and creating promises, but is unable to print gold or create oil.” (Warren Buffett, 1979 shareholder letter)

While we entered the year expecting orderly rate cuts, easing geopolitical pressure, and a growing world economy, we now face the worst-case inflation risk: NACHO – Not a Chance Hormuz Opens. At the time of writing, May had seen a series of failed diplomatic attempts to secure an end to the war between the US and Iran, with the priority being opening the Strait of Hormuz and thus allowing 20% of the world’s oil to flow freely again.

Against this backdrop, global markets spent most of the month in a tug-of-war between better-than-expected US corporate earnings on the one hand and concerns about the war’s impact on the macro economy on the other. When the dust settled they had ended the month higher, though some analysts are seeing the equity market’s rally as increasingly fragile and underpinned by shaky fundamentals.

NACHO and the inflation comeback nobody wanted

In May, Brent crude briefly traded above $110 per barrel as the Strait of Hormuz remained closed and US-Iran negotiations stalled. There’s even been talk of NACHO (Not a Chance Hormuz Opens), a worst-case tail risk facing markets.

This has meant the Federal Reserve, which opened 2026 with two rate cuts priced in by futures markets, is not expected to cut again this year, and Europe is moving in the same direction. The phrase that dominated May’s investor communications across every major global investment house was the same: “higher for longer”.

South Africa: Caught in the crossfire

As a net fuel importer, South Africa’s April CPI surprised sharply to the upside, increasing to 4.0% year-on-year versus 3.1% in March – the highest reading since August 2024. The jump was driven almost entirely by fuel prices, but second-round effects are already visible in transport costs and food inflation.

The South African Reserve Bank has held the repo rate at 6.75% for two consecutive meetings, before raising it 25 basis points at the latest MPC meeting. For South African investors, this means the tailwind of a rate-cutting cycle may be reversing.

Navigating the higher-for-longer reality

So, what should South African investors be doing to position themselves for this shift in the global macroeconomic landscape? Here’s a checklist of what to consider when higher inflation and interest rates are on the horizon:

Fixed income inflation-proofing. Long-dated bonds are more sensitive to interest rate moves, while shorter-duration instruments, floating-rate bonds, and inflation-linked securities offer better protection in a rising-rate environment.
Inflation-resistant stocks. Energy stocks, gold miners, materials companies, and other businesses with pricing power have historically outperformed during periods of persistent inflation. South African gold miners, in particular, are positioned to benefit from higher bullion prices.
Prioritise quality in equities. Companies with strong balance sheets, durable cash flows and consistent earnings are better placed than speculative growth shares.
Diversify. A weaker rand and rising domestic rates make the case for geographic diversification even more compelling.
Maintain liquidity. Holding a higher cash or money-market allocation preserves flexibility.

While the investment landscape is rife with uncertainty, the fundamental investment case for South Africa has not collapsed, and a resolution of tensions in the Middle East would remove a significant headwind to growth and inflation. However, higher inflation is unlikely to be a passing phase.

*All facts and figures accurate at time of writing.

What if You Live Longer Than You Thought You Would?

“Aging is an extraordinary process whereby you become the person you always should have been.” (David Bowie)

We often think of getting older as getting worse. But more and more, it’s something else: a long period of living well. People today aren’t just living longer. They are living a lot longer than anyone thought they would. And while that is one of the greatest things people have ever done, it is slowly changing the way retirement looks.

Retirement is no longer a short, last chapter. It’s a long, changing time in life that requires more careful planning than most people think.

The quiet change in longevity

Life expectancy around the world has increased by more than 20 years in the last century. Even though the national average in South Africa is relatively low, this masks an important fact: people with access to good healthcare, a steady income, and a healthy lifestyle often live well beyond their 90s. And even a few extra years can make a big difference in retirement planning.

The longevity gap most people don’t plan for

It might not seem like a big deal to live five to ten years longer. But consider the financial implications:

Your money needs to last longer
Inflation works (usually against you) for a longer period
Costs for healthcare and other care requirements go up
It’s harder to fix mistakes later in life

Planners call this “longevity risk,” basically the risk of running out of money before you die. Cash flow modelling tools typically show that even a small increase in life expectancy can mean that you may need to cut your annual income by a significant amount to keep your plan going.

Living longer is only half of the story

The real problem is that the cost of getting older is also going up. Medical inflation is still higher than general inflation, and the cost of care, whether at home or in a specialised facility, can be very high.

But there is more than just cost. What if you need help for a long time? What if you can’t make financial decisions on your own anymore? What if a global health crisis makes care less available or more expensive?

One of the biggest risks is a decline in cognitive function. Dementia, in particular, is expected to rise sharply in the coming decades, putting a lot of stress on families and individuals both emotionally and financially.

In many cases, adult children step in, often without warning, to make decisions, organise care, and pay for things. That’s why planning for a long life isn’t just about money. It’s about being clear and respectful, and thus making things easier for the people you care about.

Planning for a longer life

Making a plan for a long life isn’t just one simple decision. It entails a mix of financial planning, adaptability, and alignment with your family. Here are four important things to think about:

1. Plan for more than you expect

It might not be enough to plan to live to 90 anymore. Stress-testing your financial plan to last until you’re 100 or older gives you a better idea of how long your capital will last and shows you where it might fall short, helping you start planning for retirement.

2. Set aside funds for longevity care

Putting money aside just for healthcare and long-term care can help protect against the unknown. This could involve allocating an investment for longevity care, or, if you are younger, creating a new investment to which you make regular contributions. The asset allocation will depend on your time horizon.

3. Make your income more flexible

Rigid drawdown strategies can put too much stress on capital. Your portfolio can stay strong for a long time if you take a flexible approach and change your income based on how the market is doing. It’s wise to reduce your drawdown when the market is underperforming.

4. Talk about what matters

This is the step most people forget, but it’s the most important. Talk about:

How and where you want to be taken care of
Who will make choices if you can’t?

Being clear now will prevent confusion, fights, and stress later.

Not just more years, but also better ones

One of the best things people have done is live longer. But if you don’t have a plan, it can quietly become one of your greatest financial risks. The goal is not just to live longer. It is to make sure that those extra years are spent with dignity, hope and options.

With the right structure in place, living a long life is about not just more years, but better ones too. We can help you to make realistic plans for how long you will live, prepare for rising healthcare costs, and ensure your financial plan aligns with your family’s needs and goals.

Climbing a “Wall of Worry” on an Unstable Footing

“Markets don’t rise on euphoria; they scale the wall of worry.” (Michael Arone)

Why US equities keep rising as warships gather

Despite the outbreak of war in late February, US equities have shown remarkable resilience, with the S&P 500 recently reaching record highs. The reason for this worrying disconnect between what is happening on the ground in Iran and how the market is behaving is attributed to a few factors:

US growth remains resilient, and corporate earnings continue to expand.
The conflict is relatively contained, with recent rallies fuelled by optimism surrounding a potential ceasefire.
The US stock markets are still being driven by a handful of the AI heavyweights, despite concerns about elevated valuations and market concentration.

However, institutional analysts like Goldman Sachs warn that markets are “sprinting across a peace bridge that has not been fully built”. Good news is currently fully priced in, and the bad news, such as a sustained oil spike or a policy shift, is not.

South Africa: A more tempered reality

While US markets continue to outperform strongly, the South African story has been more mindful of potential risks ahead. The JSE All Share Index entered bear market territory in April, falling more than 10% from its peak and, as at 22 April, was trailing the US S&P 500’s 8.42% one-month rally by more than 3 percentage points, with the JSE All Share Index at 5.1%.

Contributing factors to this return gap include South Africa’s position as a net oil importer, its high sensitivity to energy shocks, and the inflationary pressure from higher oil prices, which has translated into a surge in domestic fuel prices. The IMF also dented investor sentiment late in the month, cutting South Africa’s 2026 growth forecast to 1.0%, citing trade barriers and higher operational costs due to high energy prices.

Navigating volatility with a “faulty instrument panel”

Behind this overly optimistic market recovery also lies the reality that traditional market signals have grown less dependable during this crisis.

Instead of acting as a safe haven, gold has declined 10% as investors sell liquid assets to cover losses elsewhere.
While oil remains roughly 40% above pre-war levels, long-term inflation expectations have actually dipped, suggesting a complete divorce from fundamentals – for now.
The dollar has also been surprisingly firm, strengthening despite Iran’s efforts to settle oil in yuan.

What to do as the Wall of Worry becomes increasingly unstable?

History has shown that unwarranted market optimism eventually confronts reality when tail risks come home to roost. Clients should stand firm rather than react out of fear or uncertainty. Investors can take the following steps:

Manage asymmetric risk: While the upside is mostly priced in, a small negative shock could trigger an outsized move lower.
Revisit inflation exposure: Stagflation, a potential outcome if the war becomes protracted, would erode fixed-income distributions. Consider investing in assets with pricing power.
Maintain liquidity: Holding cash or maintaining money-market exposure provides flexibility when markets return to reality.

South African investors can take comfort from the domestic market’s more measured response and the fact that the country’s fundamental investment case still holds. If geopolitical tensions ease, the current undervaluation might be too pessimistic, potentially leading to a reassessment of the stock market’s value.

*All facts and figures accurate at time of writing.

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