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No Patrick. My calculations are correct. There is no CGT if you withdraw monthly. It is income and tax is paid at your tax margin as revenue.
You are retired and withdraw monthly for income. It will not be CGT.
Now that first calculation was based on R350k withdrawals py. As you age, the less you spend. If I were to stay in SA then my circumstances would warrant a R18 000 pm withdrawal or R216 000 py. The divies will be an extra bonus.
Started with R667K and made 200% gains then retired. You will now have R2m.
The R667K bought you 20 000 shares in ABC.
R667 000.00/20 000 = Base Cost of R33.35 ps
Now your R2m will have a market value of R2m/20 000 shares = R100
Sell 2160 shares at R100 ps = R216 000
Cost price of 2160 shares at R33.35 = R72 036
Gain is R216 000 - R72 036 = R143 964
Tax = R14 474
Older than 65.
Tax = R8 084
From this you can deduct internet costs, a portion of your laptop cost and medical expenses. So on R18K pm plus divies you will pay less than R1 000 pm tax.
I own quite a few sgl in real trade so I hope you win the competition.
Am wondering what to do with the dividend out soon
A good, well written article. Did you copy that or write it yourself Patrick?
What Index funds do you have in mind?
(obviously aside from dividends witholding...)In 1988 we made major purchases of Federal Home Loan Mortgage Pfd. (“Freddie Mac”) and Coca Cola. We expect to hold these securities for a long time. In fact, when we own portions of outstanding businesses with outstanding managements, our favorite holding period is forever. We are just the opposite of those who hurry to sell and book profits when companies perform well but who tenaciously hang on to businesses that disappoint.From: http://www.berkshirehathaway.com/letters/1988.html
that chart looks frightening to me. Gone up too fast and too high again. The 28000 mark looks like where she should be.
