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very interesting find.

i will investigate a bit more

this part :

"Although the global portfolio is based on offshore investment
markets, it is unaffected by any rand appreciation or
depreciation. You will therefore not be exposed to any risk
of currency fluctuations. "

i guess that is where the golden egg lies. Eg they will make the profit on the exchange rate difference ( R1,000,000(buy) in Euro's today vs R1,800,000(sell) in Euro's in 5 years is a big difference.



I need to figure out what this part is before a decision though :

Lump sum Discovery Endowment Plan administration fees and financial adviser
fees apply. These will reduce the final return received.

*edit*

a few rough calculations later, subtracting the fee's i was able to find online :

R100,000 invested with 45% gain will give you R137,119  : almost 8% gone due to fee's. I have dropped them an email to confirm...not expecting a reply though

Quote from: Mr_Dividend on August 04, 2015, 01:24:54 pm

BTW

Have just received results in the post from Naspers, which I only own through EE. This means, I guess, that my name is listed on the JSE/ Compushare/ whatever as the owner - not only with EE.

So it seems, besides the fractional ownership, it's exactly the same as having your account with anyone else - just cheaper.

Good to know. I plan to use them in future when I can't hurt the trade amount for minimum fees with ABSA stock brokers. Weirdly I'll be switching my tfsa to ABSA as they're cheaper by 0.05%!

Hi Patrick

did you end up going with Absa? Last time i saw feedback, is that Absa doesnt supply the full range of ETF's? or has that changed.

Update to version 3.5
* Added a once off bonus at FI - configurable. This is to allow a lumpsum draw to happen at FI, mostly for big expenses (paying off house/car, etc)
* Fixed tax tables between FI age and 55- changed to CGT tax(was previously normal tax)
* Improved readability on summary screen

Quite an interesting question came up during my recent en devours to build a F.I calculator, where someone asked if Dividend tax was allowed for.

Although i couldn't include this in the calculator (dividends and thus the resulting tax will be different per instrument), i was however wondering what the fact sheets out there are using.

verifying with Satrix directly, the calculator on their website shows results without dividend tax applied - which means my returns investing via my broker will be a few percent lower than what is reported

Assuming this is the case with most online sources, i am wondering which investment tools/platforms allow you to enjoy to enjoy growth on a Equity/ETF without paying tax on dividends?

currently the only two i can think off is  Retirement annuities and TFSA?

does anyone else maybe have additional platforms they can recommend?

erwintwr

Update to version 3.4
*Adjusted internal calculations ,based on paying current loans (eg home /car) - expenses that wont remain into financial independence for long - configurable(change to zero if you plan to keep paying off your home/car up to 95 )
*improved the results screen ,showing more details as to what is happening, including your salary at FI.

only challenges that still remains :
* Drawing a salary after FI is calculated, mostly, based on drawing your tax every month. this wont be the case, as you will draw a once off SARS amount after tax claims are due. (thus additional savings will happen especially if you pay large tax amounts, since your tax owed will grow during the year in your portfolio)

* Homeloan and car expenses is removed after the payment period is complete - not sure how to tackle the scenario where you want to continue wasting money into the latest and fastest clown-mobiles every few years. for now, please configure the buffer to allow for any expenses that you will keep/add after FI.

Update to version 3.2
*Tax tables was "ahead" with a year - Corrected
*Improved the Salary prediction required at Financial Independence - should now be much more accurate(current expenses is inflation adjusted with buffer added, then reverse tax is applied to determine the before tax salary)
*Added a Spending buffer which will be added to your salary after FI (use full if you want to go on that yearly travel trip :p

Quote from: erwintwr on June 10, 2015, 12:58:51 pm

*sulks at salary - i will be there in a few years i hope*

i have divided the difference between current age and 55 in 4 parts, thus resulting in (55-40)/4 = 3.8 years per result. you are welcome to modify the constants(analyze after year)  to 4, 5, 6 and 7 to see a more accurate result for those years. (year 6 seems to be the extreme limit with 1K surplus)

not sure if i follow your last statement? Inputting your values shows that RA/TFSA/Equity is higher? (112k surplus vs 67k maxing equity only after 7.5 years)
excel will highlight the bigger value green

I rounded down a little 

Here's the query:

Results(FI After 15 years)            
Yearly Salary   "Max TFSA then Equity
(no RA)"   Max Equity only   Max TFSA then RA then Equity   Max RA then TFSA then Equity
RA (15%)   R 0,00   R 0,00   R 359 365,37   R 483 959,65
TFSA   R 152 760,08   R 12 603,98   R 153 099,74   R 147 385,83
Equity   R 5 952 262,70   R 6 211 969,35   R 5 380 981,96   R 5 280 140,85
Required   R 1 217 552,98   R 1 217 552,98   R 1 217 552,98   R 1 217 552,98
Total surplus (after tax)   R 4 498 042,92   R 4 597 112,03   R 4 206 445,16   R 4 185 992,94
"Total yearly surplus
(Inflation adjusted)"   R 1 746 296,55   R 1 784 758,62   R 1 633 088,17   R 1 625 147,90

As you can see, the total surplus is highest on equity only. I would have thought it would be highest on RA, TFSA then equity but it's lowest there.

*edit* - are you still running on your original inputs(1mil 50% invested with 5mil in equities)? - My results looks much less than yours :/

not a major difference between them, but in 15 years you will be 55 - thus calculation is quite easy.

@55 years

Equity only will give 47.5mil plus the 0.1mil from the TFSA - possible to draw 3mil, and only taxed on 800k of that(-90k) = get 3Mil out

max TFSA then RA then equity will give 39.6mil Equity + 2.3Mil TFSA + 9.7Mil RA = 51.7 Mil. Possible to draw 3.1Mil, but you will be taxed double(-188k) = 2.9Mil out.

Row 56 on the worksheets gives the salaries ( and J52 the tax that is paid on that salary)

remember that equities is taxed on a third of the capital gains 3mil draw = 2.5mil capital gain = 805k tax - and by that stage 805k is in the 26% bracket with an even larger rebate.

Update to version 3.0
Major functionality update - basically it is now a South African Financial Independence calculator. Most Inputs is customizable, including Age, Inflation, and current portfolio values. System will output 3 periods between your current age and 55 years, allowing you to see capital growth.


Can someone maybe recommend some financial /retirement draw down calculators out there? i would like to run simulations to compare values.

For now it looks quite accurate  - Any comments is welcome.


Basic operation :

• income is invested as per inputs
• investment is stopped at the configured FI years
• draw-down is tested(eg first equity then TFSA(draw salary is current salary minus savings)
• once 55 is reached draw capital is combined with RA, and max salary is drawn to reach 95
• possible surplus salary at 55 is reported (after tax)

**Note1  If draw down pre 55  failed, salary will be shown as R0.00