I have so enjoyed the start of 2018 – it is so uplifting to read the papers, to listen to the news and, for the first time in many years, to feel that there has been a shift and things are starting to happen. We have a long road ahead, but certainly, with Cyril at the helm, there is progress.
I walk past our table in reception where our newspaper lies and see the headlines that the JSE has reached an all-time high and, in the next article, the rand is recorded to be the strongest it has been since 2015. Long may the good news continue to flow!
Our next big hurdle is the Budget Speech towards the end of February. The ratings agencies have put things on hold until this time to see what plans our Minister of Finance has for finding the R50 billion shortfall and the funds for President Zuma’s shock announcement of free tertiary education for low-income earners. I have heard many mixed opinions on this ranging from an increase in VAT to higher tax rates and possible increases to Capital Gains Tax. We shall be observing this carefully and informing you of any actions that may be necessary.
Bitcoin – time to take a bite?
I am sure many of you have heard more and more about Bitcoin recently; it certainly has been prominent in many conversations in the past few months. I have a number of close friends who have become Bitcoin millionaires in the past year. Sadly, I was not one of them. I have observed Bitcoin and tried to gain a greater understanding of it over the past 12 months, and even went so far as to bring it to one of our Financial planning team meetings in July last year.
As a financial planner, a rule I live by is that I would never advise a client to invest in anything that I don’t understand and this is something all of us at Chartered live by. Another rule is: if it sounds too good to be true, it probably is. So, where does this leave me when my 15 year old Son, Nic, came to me in September and asked, “Please, Dad, can I buy some Bitcoin with my savings?”
Having been curious for the past few years and living by my principles, when it came to this request I thought it was an opportunity to be open minded (given that it was not a client’s money … nor mine!).
My condition was that Nic had to put an equal amount of money in shares. So we took his R10 000 that he had in his bank account and bought R5 000 worth of Bitcoin. We chose five shares, investing R1 000 in each.
The next morning the Bitcoin was up 10%, and the shares had done very little and so it went … Two weeks later, Bitcoin was up 43% and I could see Nic thought shares were a total waste of time. I was relieved when, last week, he said that his shares had done quite well and Bitcoin was so bad: his money in Bitcoin had doubled and then halved in nine weeks, whilst his shares had slowly gone up.
I am grateful for my son to have experienced that there is no quick way to make money and returns come with patience and time.
In summary, the world of cryptocurrencies is dangerous. If you understand that you can lose your money and can afford to, then this may be something to invest in, but it is not recommended for most people.
RetiremeantTM Workshops for Chartered Wealth Solutions clients
Lastly, we enjoyed running our first RetiremeantTM Workshop at Chartered last week. About 40 people attended, 25 of which were clients and about 15 were guests. The feedback was amazing – we had clients of 15 years saying they had learnt so much. This is something we are going to do more often at Chartered, encouraging clients to bring friends to learn about RetiremeantTM the Chartered way. If you would like to attend an upcoming workshop, please email email@example.com and she will send you details.
Wishing you all a successful 2018.