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    LawrencePosted: 12:46 pm 25/10/2016

    How do I budget effectively?

    The GuruAnswered: 2017-01-03 13:19:15

    Without knowing your personal circumstances, it is not possible for me to advise on how you should budget effectively. However, I will share with you the approach I use. It involves applying a concept known as ‘pay yourself first’. How this works – make some financial-enhancing commitments. For example, allocate a certain percentage of your income to a retirement annuity, an education plan if you have kids, an emergency fund, etc. Essentially, you want to commit to doing something constructive with a percentage of your income. This is the amount that you ‘pay yourself’. The remaining balance is all yours to do what you please; Splurge, spoil yourself, go on holiday, do whatever you want. As Warren Buffet says, “Do not save what is left after spending, but spend what is left after saving”.

    CarlPosted: 12:47 pm 25/10/2016

    Should I save up to buy a car cash or is it fine if I take out a loan to buy a car?

    The GuruAnswered: 2016-10-25 12:46:06

    Taking out a loan in order to acquire a vehicle isn’t necessarily a bad thing so don’t be adamant on saving up the money in order to purchase the vehicle cash. More important than making a cash purchase is making a smart purchase. Acquiring a vehicle is a substantial purchase and it is vital to do thorough research before making this commitment. Two things to consider:

    1) Interest rate; the interest rate that you take the loan out at is probably the most important factor. So make the effort to approach several financial institutions before taking out the loan and do not focus on getting a low monthly instalment (example, a high interest rate with a balloon payment at the end of the loan term will give you a low monthly instalment but is not an advisable option), focus on getting a low interest rate.

    2) Depreciation; vehicles depreciate and so the loan can be considered ‘bad debt’, however it is possible to counter this - research into cars that have a good resale value and consider purchasing second hand cars because brand new cars depreciate significantly more.

    RaphaellePosted: 12:49 pm 25/10/2016

    How do I submit my taxes?

    The GuruAnswered: 2016-10-25 12:43:36

    I would suggest hiring a tax practitioner. They don’t cost that much and they can save you loads of time. They will submit your taxes online so you won’t need to worry about going into SARS. In addition, they might even help you save on tax.

    TauriqPosted: 12:52 pm 25/10/2016

    How can I start trading foreign exchange?

    The GuruAnswered: 2016-10-25 12:39:05

    There are several platforms where you can start trading foreign currency. I would advise opening up an account with your bank. Do be careful though as it isn’t easy to consistently make money from trading currencies. It may be marketed as a way to make easy money and this is true. However it is also easy to lose money. If you want to start trading foreign currencies, consider investing into global investment funds through reputable investment companies. In this way you get access to foreign currency but at the same time, you have professionals looking after your money. You won’t be making huge amounts overnight but you also won’t be losing huge amounts overnight.

    KhayaPosted: 12:53 pm 25/10/2016

    Should I take out all my insurance policies with one provider or with many different providers?

    The GuruAnswered: 2016-10-25 12:38:00

    All major companies offer similar benefits and there isn’t much differentiating the various companies. So whether your policies are with one company or with different companies doesn’t really matter. What you do want is an advisor whom you can trust and who has your best interests at heart. Meet with various advisors and find someone you feel comfortable with, someone who is transparent, someone whom you can trust and someone who is a Certified Financial Planner professional. Then take out all your policies and investments with that person.

    ZolaniPosted: 12:57 pm 25/10/2016

    What is the best way for me to diversify my investments?

    The GuruAnswered: 2016-10-25 12:34:31

    I would suggest investing through investment companies. Some good companies are Prudential, Coronation and Stanlib. When you invest into one of the company’s funds, your money gets instantly diversified. These companies have research teams that constantly analyse the markets so your money is very well looked after. Because so many people invest so much money, the cost is usually divided between the many investors and so for the benefit that you receive, the cost is usually minimal.

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