Question 1

How is Bauer Bersella Advisors different from other financial advisors?

Accepted Answer

We act as your Personal CFO. We're truly independent: we don't sell products or earn commissions, so our only agenda is your financial success. Our typical fees are published on this website and agreed with you in writing before you commit to anything. We use technology to execute with institutional precision, but we believe financial advice is fundamentally a human relationship. Most importantly, we personalise everything, including your pricing, to your unique financial context and stage of life.

Question 2

How much does financial advice cost?

Accepted Answer

Our typical fee is an assets-under-management fee of between 0.5% and 0.75% per year, agreed upfront and disclosed in writing before you commit to anything. More importantly, we will always recommend the most appropriate fee structure for your unique financial and life context. No hidden fees, no product commissions. Visit the pricing page for how we approach this, or book a consultation and we'll walk you through exactly what you'd pay and why.

Question 3

Are you regulated?

Accepted Answer

Yes. Bauer Reuvers & Associates (Pty) Ltd (trading as Bauer Bersella Advisors) is an authorised Financial Services Provider, FSP licence number 539. The firm was established on 1 October 1989 and has held its licence since FSP registration was first introduced in South Africa in 2004. The low licence number reflects how early we registered. We're bound by fiduciary duty under the FAIS Act: we act in your best interest, disclose all fees, and maintain professional indemnity insurance. We comply with FAIS, FICA, and POPIA regulations.

Question 4

Can I leave Bauer Bersella Advisors if I'm not happy?

Accepted Answer

Absolutely. If you're not satisfied, we'll refund your fees from the previous 12 months. There are no lock-in contracts or notice periods. And because your investments are always held in your own name, moving them is straightforward if you decide we're not the right fit.

Question 5

How much money do I need to retire comfortably in South Africa?

Accepted Answer

This is our most asked question. While everyone's needs differ, most of our clients need between R10-25 million to maintain their lifestyle in retirement. The exact amount depends on your spending, health, and goals. We have a free 2-minute calculator that gives you a personalised answer based on your unique financial context.

Question 6

Who is Marco Bauer?

Accepted Answer

Marco Bauer is the Chairman and a co-director of Bauer Bersella Advisors, and he has been the one constant in this practice for more than 35 years. He started out in 1989 advising clients under his own name, as Marco Bauer Financial Services. The name above the door changed several times after that as he took on partners and joint ventures: Bauer & Thompson, then Bauer Lawrence & Associates, with Bauer Reuvers running alongside it for a period. Bauer Reuvers & Associates became the firm that carried the practice forward, and it holds FSP licence number 539, registered as soon as financial advisors in South Africa were required to be licensed. That licence number is among the lowest in the country.

The letterhead changed; the advisor didn't. That continuity is really the point. Clients who first sat down with Marco in the early years are still with the practice today, and some of those relationships now span three generations of the same family. More than 35 years of advising South African families and business owners makes him one of the most experienced independent financial advisors in the country.

Bauer Bersella Advisors is the latest chapter, and a succession plan rather than a rebrand: Marco's son-in-law, Luca Bersella, joined the practice and now serves as CEO while Marco continues as Chairman. Marco is a Chartered Accountant CA(SA), holds a BCom and a BAcc from Wits, is a Key Individual on the licence, and leads the firm's investment philosophy.

Question 7

Who is Luca Bersella?

Accepted Answer

Luca Bersella is the CEO and a co-director of Bauer Bersella Advisors, alongside Chairman Marco Bauer, who is also his father-in-law. He qualified as a Chartered Accountant CA(SA), spending three years in audit at BDO in the UK across a diverse range of companies, and then five years as a solutions architect at a UK fintech before joining the family practice in Cape Town, established in 1989.

That combination is deliberate. The audit training is what lets him read a client's complete financial position properly rather than just the investment portfolio, and the engineering background is what lets the firm build the systems that get thorough work done faster. He is an evidence-based investor, and he leads the firm's work to pair deeply personal advice with modern technology: human first, technology enabled.

Question 8

Will I be handed over to a junior advisor?

Accepted Answer

No. You work with the directors of the firm. Bauer Bersella Advisors is deliberately small: we look after around 120 client families rather than thousands, which is what makes direct access to senior people possible at all. The advisor who builds your plan is the advisor who reviews it with you, and you have their direct contact details. If we ever grow past the point where that holds true, we'll change how we describe the service rather than quietly dilute it.

Question 9

Is Bauer Bersella Advisors a robo-advisor?

Accepted Answer

No. We're a human-led advisory firm that uses technology as a tool, not a replacement. You work directly with our team: real people who understand your goals, tax situation, and life circumstances. Technology helps us analyse your portfolio and model scenarios faster, but every recommendation is reviewed and delivered by a human fiduciary. The difference is regulatory, not just a matter of preference: "automated advice" is its own licensed category under the FAIS Act, and we aren't licensed for it because we don't deliver advice that way. If you want fully automated investing, robo-advisors like 10X Investments might suit you. If you want personal financial advice supported by technology, that's us.

Question 10

How often should I meet with my financial advisor?

Accepted Answer

We recommend comprehensive reviews at least twice a year, with quarterly check-ins for significant portfolio changes or life events. However, you can reach us anytime between scheduled meetings. Major life events (marriage, divorce, inheritance, retirement, starting a business) should trigger an immediate review of your financial plan.

Question 11

How do you decide how much of my money goes into shares?

Accepted Answer

Our philosophy in one line: you should hold as much in growth assets as you can tolerate, both emotionally and financially. Growth assets are shares, listed property, and similar; defensive assets are bonds, cash, and income funds. Once your cash flow needs for the next few years are covered, the balance leans towards growth, because over long periods that's where the returns have historically come from, though with considerably more movement along the way.

In practice we start most new clients with roughly 40% to 60% in shares and property, depending on where your risk profile sits, and we deliberately keep volatility lower in the first year while you see how we work. From there we review annually and step exposure up towards your real tolerance as trust builds. The constraint that matters most isn't a spreadsheet, it's whether you would sell in a bad month: an allocation you can actually live through beats a theoretically optimal one you abandon at the worst moment. Retirement structures carry a further constraint, since Regulation 28 caps shares at 75%.

Question 12

Do you use passive index funds or active managers?

Accepted Answer

Both, deliberately, and for different jobs. Our direction is a systematic, largely index-tracking core that delivers broad market exposure cheaply and predictably, paired with a smaller number of active satellite allocations where we think a manager has a genuine edge worth paying for. The logic is that cost is one of the few things in investing you can control, so we don't pay active fees for exposure a cheap index fund provides just as well.

We also diversify across managers rather than concentrating with one, both to spread risk and because no client should open a statement and see a single manager across everything. We target at least two to three distinct managers across your whole portfolio, and we cap any single manager well below the level regulation would allow. Fund selection is reviewed on merit, not on any relationship with a provider, and we earn nothing from the managers we choose.

Question 13

I already have a financial advisor. Is it worth changing?

Accepted Answer

That depends on what you're getting now, and the honest test isn't loyalty. It's whether you can answer a few key questions. What percentage of your portfolio is invested outside South Africa? What percentage sits in shares? Do you know the total percentage advice fee you pay each year, across every layer? Are any of the funds or portfolios you hold managed by your advisor's own firm or a company in its group, and how are they paid when you invest in them? When did your advisor last review your tax and estate position rather than just your investments? And can they recommend from the whole investment opportunity set available, or only from their employer's approved range? If any of those answers is uncomfortable, a second opinion costs you nothing.

What clients tell us changes when they move to us: reviews and recommendations tend to arrive faster because technology handles the data gathering and modelling, the full cost is set out in writing before any work begins, and the advice covers your complete financial picture including tax, estate, and offshore structuring rather than a single account. Your investments stay in your own name at well-known institutions like Allan Gray, Ninety One and Coronation throughout, so changing advisor doesn't mean selling your portfolio. Book a consultation if you'd like us to look at what you already have.

Question 14

I'm an independent financial advisor thinking about retiring. Do you take over practices?

Accepted Answer

In the right circumstances, yes. We're a licensed FSP with a track record going back to 1989 and a modern operating platform, and part of what we do is provide continuity for independent practices whose principal is stepping back, so that clients keep receiving advice and a career's worth of relationships isn't simply wound down.

Every situation is different and we don't publish terms. What we can say is what we optimise for: the clients first, a handover paced to the relationships rather than to a deadline, and a structure that treats the retiring advisor fairly. If you're an independent advisor thinking about the next few years, reach out to us and we'll have a confidential conversation, with no obligation and nothing to prepare.

Question 15

How do you decide what my fee should be?

Accepted Answer

We qualify every client individually rather than quoting a standard rate. Your fee is recommended from your portfolio size, the complexity of your financial life, and the depth of service you need, and for most clients that works out as a percentage-based fee on the assets we advise on, typically between 0.5% and 0.75% per year, on a sliding scale as your portfolio grows. If you want to see how the two common fee models compare with your own numbers first, our fee calculator lets you do that before you talk to us. Book a consultation and we'll recommend the structure designed to help you win financially.

Question 16

What's included in the service?

Accepted Answer

Every client relationship includes a comprehensive financial plan, investment structuring and coordination across providers, proactive tax and estate reviews, regular strategy reviews, and direct access to your advisor. The depth and cadence of the service is agreed with you upfront and matched to the complexity of your financial life.

Question 17

How does billing work?

Accepted Answer

Fees are agreed with you upfront and disclosed in writing before any work begins. Percentage-based fees are typically deducted within your investment account by the investment provider, so there is no invoice to remember. Where we agree fees for specific work, we invoice exactly as agreed. All fees include VAT and there are no hidden charges.

Question 18

Is there a lock-in period or cancellation fee?

Accepted Answer

We don't do lock-in contracts. We're confident enough in our service to let the results speak for themselves. If you're not satisfied, we offer a full refund of fees from the previous 12 months. Your investments are always held in your name at the product provider, so there's no disruption to your portfolio if you decide to leave. You can end the relationship at any time.

Question 19

What happens if my portfolio grows significantly?

Accepted Answer

That's the goal. With a percentage-based fee the rand amount you pay grows with your portfolio, which is why we work on a sliding scale: the rate can step down as your assets grow. We review your fee structure together at your regular strategy reviews, and we'll always tell you before anything changes.

Question 20

What are Bauer Bersella Advisors' fees?

Accepted Answer

Our typical fee is an assets-under-management fee of between 0.5% and 0.75% per year, agreed upfront and disclosed in writing. We recommend the most appropriate fee structure for each client's unique financial and life context, with no hidden fees and no product commissions. Visit the pricing page for how we approach pricing, or book a consultation to discuss what you'd pay.

Question 21

What qualifications do your advisors have?

Accepted Answer

We're a dedicated team of CA(SA)s operating under FSP licence number 539, and we've been providing financial advice since 1 October 1989. We understand the technical complexities of tax law, estate planning, and investment strategy, and we act as your Personal CFO with a fiduciary duty to help you win financially.

Question 22

Can my fee structure change as my needs change?

Accepted Answer

Yes. Your financial life evolves, and your fee structure should keep fitting it. Events like a business sale, an inheritance, or approaching retirement can change the depth of service you need. We'll recommend the right fit during your regular strategy reviews, and nothing changes without your agreement.

Question 23

Are financial advice fees tax-deductible?

Accepted Answer

Financial advice fees are generally not tax-deductible for individuals in South Africa. However, if you're a business owner and the advice relates to your business finances, a portion may qualify as a business expense. We'll help you understand what applies to your specific situation during your onboarding.

Question 24

Do you manage my investments directly?

Accepted Answer

We provide investment advice and structuring, which means we recommend what to invest in, which investment providers to use, and how to optimise your portfolio. Your investments are held in your name at well-known institutions like Allan Gray, Ninety One, Coronation, Glacier and others. We coordinate across these providers on your behalf, but we don't take custody of your assets. This independence means our advice is always in your best interest.

Question 25

What does the onboarding process look like?

Accepted Answer

After you join, we schedule a comprehensive onboarding meeting in-person or online (Teams, Google Meet, or Zoom). We review your complete financial picture: assets, liabilities, insurance, tax situation, estate plan, and goals. From there, we build your personalised financial plan and investment strategy. Most clients are fully onboarded within 2-4 weeks.

Question 26

Can I move my existing investments to you without selling them?

Accepted Answer

In many cases, yes. Where your existing holding is a unit trust that the receiving provider also offers, it can often be transferred in specie, which means the units move across without being sold. Nothing is disposed of, so no capital gains tax is triggered.

Where the underlying fund isn't available at the new provider, or the structure itself has to change, the investment has to be sold and repurchased, and that disposal is a capital gains event. This is the most common unwelcome surprise we see when clients move, and it's largely avoidable with planning: we check what can transfer as it stands, and where a disposal is unavoidable we can often phase it across tax years so you use more than one annual exclusion. Transfers between approved retirement funds are generally tax neutral, so moving a retirement annuity doesn't trigger tax at all.

We work all of this out first, so you see the tax cost of moving alongside the benefit before you decide anything.

Question 27

Is my partner or spouse included?

Accepted Answer

Yes, always. Your partner or spouse is covered at no extra cost. They can attend all strategy reviews and have the same access to your advisor. We find that financial planning works best when both partners are involved in the conversation.

Question 28

What if my financial situation is especially complex?

Accepted Answer

Cross-border structures, family trusts, and business succession need bespoke scoping. Because every complex situation is unique, we tailor the scope and the pricing to match the work involved, and we put it all in a transparent proposal before you commit to anything. Book a consultation and we'll assess your needs, with no obligation.

Question 29

Who is Bauer Bersella Advisors not the right fit for?

Accepted Answer

We're built for people who want an ongoing advice relationship around their investments, retirement, tax and estate. That suits some people well and others poorly, and it saves everyone time if we say so plainly.

We're probably not the right firm for you if what you need is someone to run your money day to day, if you're looking for debt counselling, or if you want a platform to trade on yourself without advice. We're also not the right fit if you want to be sold something once and then left alone, because that is neither how we work nor how we are paid.

None of that is a judgement about what you need. It is a different job, usually done better by a different professional. Where we can point you to the right one, we will.

Question 30

Do you manage my day-to-day banking, budgeting and bill payments?

Accepted Answer

No. We're an advisory firm rather than a bank, and we have no access to your bank account. We don't administer debit orders, pay your bills, track your spending against a budget, or make sure there is money in the account for a payment that falls due.

That work is usually three different people. A private banker for the account itself. A bookkeeper or personal financial administrator for the budgeting and the monthly bills. And, where debt is part of the picture, a registered debt counsellor. Our work starts once your month-to-month position is stable, and it covers the longer-horizon decisions: what you are invested in, how it is taxed, and what happens to it later.

If you are not sure which of those you need, ask us anyway. We would rather point you to the right professional than take on work we cannot do well.

Question 31

Do you prepare and submit my tax returns, or do my bookkeeping?

Accepted Answer

No. Tax is central to what we do, but as planning rather than compliance. Our work is on how your money is structured across accounts: which wrapper suits which goal, the order you draw income in retirement, how and when a disposal is timed. That work has to happen before the tax year closes, because afterwards the position is largely fixed.

Preparing and submitting your annual return, and keeping your books, is your accountant's job and we don't do it. Most of our clients already have one. Where they do, we would rather coordinate with them than duplicate them: they hold the historical detail, we look at the structure going forward, and the two fit together better than either does alone.

If you don't have an accountant and need one, tell us and we will point you in the right direction.

Question 32

Do you ever hold or take custody of my money?

Accepted Answer

No, and this is worth understanding properly, because it is your main protection. Your money is held in your own name at the institution you invest with, such as Allan Gray, Ninety One or Coronation. It never passes through us. We don't accept deposits, and instructions to move or withdraw funds go to that institution and require your authorisation.

We hold a mandate to advise you. We do not hold your funds, and we are not licensed to act on a discretionary basis, which means we cannot move your money on our own say-so. In practice that means no single person here can ever have open access to your savings.

That is a reasonable thing to ask any firm you are considering, and you should ask it. If the answer is not immediately clear, treat that as information.

Question 33

Can you help if I am under debt review or struggling with debt?

Accepted Answer

Not directly, and it matters that we are clear about it. Debt counselling is a separate regulated role in South Africa under the National Credit Act, carried out by a debt counsellor registered with the National Credit Regulator. We are not registered for it, and we cannot manage or renegotiate debt review arrangements.

If you are currently under debt review, your debt counsellor is the right person for anything touching those arrangements, and a bookkeeper or personal financial administrator can help with the monthly budgeting alongside it. Your bank can usually point you to both.

Advice of the kind we give tends to become useful later, once the debt side is settled and the work turns to building rather than repairing. There is no rush and no obligation. When that time comes, we will be here.

Question 34

Can I just use you to buy funds without the advice?

Accepted Answer

Not really, and that is a deliberate choice rather than a restriction. We are not an investment platform: there is nothing here to log into and trade on. What we are set up to do is give advice, and our fee pays for that advice and the relationship around it, not for placing a transaction.

If you know exactly what you want to buy and you are comfortable managing it yourself over the years, a direct platform will cost you less and serve you better. That is a perfectly sensible way to invest, and we would rather say so than charge you for something you don't need.

Advice tends to earn its keep when the decisions start interacting: retirement timing, tax structuring across several accounts, offshore exposure, an estate with moving parts, or simply not wanting to be the person making the call in a bad market.

Question 35

What is AI-enabled financial advice?

Accepted Answer

AI-enabled financial advice means a human financial advisor uses modern technology, including artificial intelligence, to deliver faster and more thorough work. At Bauer Bersella Advisors our people lead every client relationship and make every recommendation; technology assists with analysis, modelling, and research. This is different from robo-advisors, which are fully automated with no human advisor. Our framing is simple: human first, technology enabled.

Question 36

What is automated advice, and is it regulated in South Africa?

Accepted Answer

Automated advice is a defined category in South African regulation, not a marketing label. Under the FAIS Act it means advice furnished through an electronic medium using algorithms and technology, without the direct involvement of a natural person. A firm providing it has to be licensed and authorised for that specifically, and it takes on additional obligations: documenting and regularly reviewing the logic the algorithm applies, holding the competence to monitor what that algorithm produces, and telling clients plainly that the advice they're receiving is automated.

We aren't licensed for automated advice and we don't provide it. Every recommendation you receive from Bauer Bersella Advisors comes from a licensed representative who has considered your particular circumstances. A robo-advisor sits on the other side of that line: there, the algorithm is the advisor rather than a tool the advisor uses.

One clarification, because it's a reasonable thing to wonder about a firm that talks about technology. The free calculators on this site are educational tools that give you information and projections. They don't make recommendations, and using one doesn't create an advice relationship. If you want advice on what to actually do with your money, that comes from a person.

Neither model is illegitimate. Automated advice is properly regulated and suits people who want low-cost, standardised investing. It's simply a different service from ours, and firms shouldn't blur the line between the two.

Question 37

What makes an independent financial advisor different from a bank?

Accepted Answer

Unlike banks, we don't have products to sell you. We're truly independent, which means we can recommend the best solutions from any provider. Our only agenda is your financial success. We work with more than 25 institutions to find the best options for you, and we don't earn product commissions.

Question 38

How is an independent financial advisor different from a large corporate advisory firm?

Accepted Answer

Large national advisory firms are built for scale, and scale has trade-offs. Your relationship usually sits with a branch advisor who can be reassigned, recommendations tend to be drawn from a central approved list that often includes the group's own funds, and the fee schedule is set centrally rather than agreed with you.

Independence works differently. Under the FSCA's own framework, a firm can only call itself independent if it isn't restricted in what it may recommend, which is a higher standard than a tied or multi-tied firm has to meet. In practice that means you deal directly with the directors of this firm, your advice is drawn from the whole market rather than a house list, and your fee is recommended for your circumstances and disclosed in writing before anything begins. The honest trade-off is capacity: a large firm has more staff and a bigger brand behind it. What we offer instead is direct access to senior people who know your file, and no incentive to place you in something the group happens to own.

Question 39

How does a fixed annual fee compare with a percentage-based (AUM) fee?

Accepted Answer

Honestly: it depends, and anyone who tells you one model is always cheaper is oversimplifying. At smaller portfolio values, a percentage-based fee often costs less per year than a fixed annual fee. As a portfolio grows, a fixed fee can become the more cost-effective structure. Where the crossover sits depends on the percentage charged, the portfolio size, and the depth of service involved. Use our fee calculator to compare both models side by side with your own numbers.

Question 40

What am I actually paying in total: the advice fee, the provider fee, or the fund fee?

Accepted Answer

All of them, and conflating these layers is the single most common source of confusion we see. There are three costs in almost any investment, plus transaction costs where they apply:

The advice fee is what you pay us for the plan, the recommendations, and the ongoing relationship. Ours is typically 0.5% to 0.75% per year, and where a lump sum needs significant upfront structuring an initial advisory fee may apply, always agreed with you beforehand. The provider fee is what the investment provider charges to administer and hold your account, and it goes to them, not to us. The fund fee, usually quoted as a total expense ratio, is what the underlying manager charges to run the portfolio, and it's already deducted inside the fund's returns rather than invoiced. Transaction costs, such as brokerage or switching costs, apply where relevant.

What matters is the total, so our practice is to set out every layer and the combined annual figure in writing before any transaction. We also treat the layers that aren't ours as things to manage actively: provider and fund selection are part of the advice, and lowering the cost of those layers is one of the more dependable ways to improve what you actually keep, since it doesn't depend on predicting markets. If your current advisor has never shown you this breakdown, ask for it.

Question 41

Is AI-assisted financial advice allowed under South African regulation?

Accepted Answer

Yes, provided a licensed human remains accountable for the advice, which is how we operate. We hold FSP licence number 539 and are regulated by the Financial Sector Conduct Authority (FSCA), and the FAIS Act attaches its duties to people rather than to software: a Key Individual and a representative are answerable for every recommendation that reaches you, whatever tooling produced the analysis behind it.

So the regulatory question isn't whether a firm uses artificial intelligence, it's where accountability sits. Ours sits with the directors. Technology is internal tooling for analysis, modelling, and research; a human reviews and delivers every recommendation, and the advice record we're obliged to keep reflects a human decision. Your personal information is handled under POPIA, and we don't feed client data into tools that would use it to train third-party models. If a firm can't tell you who is personally accountable for a recommendation, that's the answer you're looking for.

Question 42

What is a financial advisor and what do they do?

Accepted Answer

A financial advisor is a professional who provides personalised financial guidance to help you achieve your financial goals. At Bauer Bersella Advisors, we provide comprehensive financial planning including retirement planning, investment management, tax optimisation, estate planning, and risk management. We're an authorised Financial Services Provider (FSP 539) regulated by the Financial Sector Conduct Authority.

Question 43

How do I choose a financial advisor in South Africa?

Accepted Answer

Look for advisors who are licensed as an authorised Financial Services Provider (FSP) with the Financial Sector Conduct Authority (FSCA), comply with the Financial Advisory and Intermediary Services (FAIS) Act, are transparent about fees, and have a fiduciary duty to act in your best interests. Check their FAIS disclosure, ask about their experience with clients similar to you, and make sure they explain things in plain English. Independence from banks and product providers matters: it means they can recommend what's best for you rather than what earns a commission.

Question 44

What is the difference between a financial planner and a financial advisor?

Accepted Answer

In South Africa, the terms are often used interchangeably, but financial planners typically focus on comprehensive life planning (retirement, estate, tax), while financial advisors may focus more on investment management. At Bauer Bersella Advisors, we provide both services as part of integrated financial advice: we look at your complete financial picture to create a holistic strategy.

Question 45

Do I need a financial advisor if I have a small portfolio?

Accepted Answer

Financial advice is valuable at any stage, and we don't set a minimum to start a conversation. Most of our clients have R1 million or more in investable assets, largely because that's the point at which coordinating across accounts, tax, and estate genuinely needs a professional. But advice taken early tends to compound: using your annual retirement annuity and tax-free savings room properly, structuring your first offshore exposure sensibly, and avoiding two or three expensive mistakes can change your position materially over the long term. If you're earlier in the journey, book a consultation and we'll tell you honestly whether we're the right fit yet.

Question 46

I have a large amount sitting in cash. What should I do with it?

Accepted Answer

Idle cash is the most common starting point for our clients, and one of the more expensive places to leave money for long. Interest is taxed at your marginal rate above the annual interest exemption of R23 800, or R34 500 if you're 65 or older, so after tax and inflation the real return on a bank balance is often close to nothing.

Cash still has a job. Your emergency reserve and anything you need within roughly two years belongs there, and for clients in or near retirement we generally keep around five years of expected withdrawals in lower-volatility assets. Beyond that, the questions are what the money is for and when you need it, because that determines the structure before it determines the fund: which tax-efficient room you haven't used, how much should go offshore, and what needs to stay accessible. Pace matters too. Where a client is uneasy about the entry point, we often phase a large amount in over several months rather than deploying it on a single day.

Question 47

Should I wait for the market to fall before I invest?

Accepted Answer

Almost every client asks this, usually while holding cash and waiting for a correction. Our position is that time in the market has historically mattered more than timing it. Missing a small number of the strongest days has tended to do more damage to a long-term return than sitting through the weakest ones, and those strong days have often clustered close to the worst ones, which is precisely when staying out feels most sensible. That's a pattern in the history, not a rule about the future.

This doesn't mean deploying everything at once regardless of circumstances. Where you hold a large cash balance and feel real anxiety about the entry point, phasing the investment over several months spreads the entry price and, for offshore transfers, can also spread capital gains across tax years. The important distinction is that phasing is a decision about your temperament and your tax position, not a forecast. Nobody at this firm will tell you where the market goes next.

Question 48

What returns can I expect from my investments?

Accepted Answer

Historically, balanced portfolios in South Africa have returned 10-12% per year over the long term (20+ years), though this includes significant volatility. Conservative portfolios may return 7-9%, while aggressive portfolios might achieve 12-15% but with higher risk. Past performance doesn't guarantee future results. We focus on building diversified portfolios matched to your risk tolerance and time horizon rather than chasing returns.

Question 49

When should I start financial planning?

Accepted Answer

The best time to start is now, and the reason is less obvious than simply saying compounding. Starting early doesn't make your money grow quickly in the early years: the amounts are small and the growth feels invisible, which is why so many people give up on it. What starting early actually buys you is a much larger balance in the final stretch, and that's where compounding does most of its work. On a 30-year horizon with steady contributions and a long-run growth rate in the range balanced portfolios have historically delivered, the last five years can add several times more rand of growth than the first fifteen combined. Actual returns vary, and they don't arrive evenly, but the shape holds: you only get those last five years by having sat through the first fifteen.

So the practical answer depends on your stage. In your 20s and 30s, consistency matters more than the amount. In your 40s and 50s, catch-up strategy and tax efficiency matter most. Even in your 60s, planning can improve your retirement income and how efficiently your estate transfers. The cost of not planning, in missed tax benefits, poor structuring, and inadequate cover, tends to exceed the cost of good advice.

Question 50

How much should I save for retirement each month?

Accepted Answer

Most South Africans should save 15-20% of their gross income for retirement, but this varies significantly based on when you start, your current age, desired retirement lifestyle, and existing savings. Starting in your 20s, 15% may suffice; starting in your 40s may require 25-30%. Our free 2-minute calculator can give you a personalised savings target based on your specific situation.

Question 51

What is the 4% rule for retirement?

Accepted Answer

The 4% rule suggests you can withdraw 4% of your retirement savings annually without running out of money. However, this American rule doesn't account for South African inflation rates, tax structures, or local market conditions. We create personalised withdrawal strategies based on your actual expenses, inflation expectations, and investment returns rather than relying on generic rules.

Question 52

In what order should I use my tax-efficient accounts?

Accepted Answer

This is one of the most valuable things an advisor does for you, and it's mostly arithmetic rather than forecasting. We work down a hierarchy, exhausting the most tax-efficient room before anything goes into a fully taxable account.

First, the tax-free savings account. It's the only structure with essentially no trade-off: no tax on growth, no lock-up, no investment restrictions, so every client should use the full R46 000 a year. Second, the retirement annuity, where contributions are deductible up to the lower of 27.5% of taxable income or R430 000 a year. That deduction is worth up to 45% of what you put in depending on your bracket, but it isn't automatic: it locks capital until 55, restricts investment choice under Regulation 28, and forces most of the balance into an income stream at retirement, so we check the deduction is meaningful before recommending it. Third, any employer retirement fund, which uses part of the same 27.5% room. Fourth, a tax-efficient wrapper, an endowment or sinking fund, which taxes growth at flat internal rates but locks the money up: the first five years are restricted, access during that period is limited and capped, and the policy may carry its own annual charge on top of the provider and fund fees, though many providers no longer levy one. It only makes sense if your marginal rate is at or near the top bracket and any such charge is worth paying. Fifth, direct offshore investment for long-term global exposure. Only then does the remainder go into a discretionary account.

The discipline matters more than the list. The most common expensive mistake we see is a large amount sitting in a discretionary account while years of tax-free and deductible room went unused, and unused annual room can't be recovered later.

Question 53

What is an endowment or sinking fund, and when is it tax-efficient?

Accepted Answer

Both are long-term insurance policies issued by a registered long-term insurer, which is a different legal arrangement from a unit trust or a bank account even though the money inside is usually invested in the same funds. They differ from each other in ways that matter on death and in how each is dealt with in an estate, and confusingly some providers market a product as an endowment that is structured as a sinking fund, so the label alone tells you less than you would expect. Which one you are actually being offered is worth establishing before anything else.

The tax argument is simple in principle. Growth inside the policy is taxed at flat internal rates set for the insurer's policyholder funds rather than at your own marginal rate, so the structure starts to help only once your own rate is meaningfully higher than the internal one. Two things narrow that gap more than most explanations admit. You give up the personal allowances you would otherwise use on the same money, which for the 2026/27 tax year means an annual interest exemption of R23 800 under 65 or R34 500 from 65, an annual capital gains exclusion, and the ability to defer capital gains tax until you actually sell. And an equity-heavy portfolio is already taxed lightly on capital gains in your own hands, so the arbitrage is narrower than a comparison based on income tax alone suggests.

Then there is cost, which is the factor most often left out. The policy may carry its own annual charge on top of the investment provider fee and the fund fee, and where it does it adds a layer to the three that apply to almost any investment. Many providers no longer levy that charge, so whether it applies is a question about the specific product rather than about these structures in general, and it is worth establishing before you compare anything. Where it does apply and your marginal rate sits below the top bracket, the charge can quietly exceed the tax it saves, which is why we work the arithmetic for your actual numbers rather than applying a rule of thumb. There are also access restrictions: the first five years are restricted, access during that period is limited and capped, and increasing contributions sharply can restart the restriction on the whole policy rather than only on the increase.

Where it does earn its place, it tends to be for someone at the top marginal rate with a long horizon and no remaining tax-free or deductible room, and sometimes for a trust that retains rather than distributes its income. The trust case turns on attribution rules that are specific enough that a general answer would mislead, so we work it through with your tax adviser rather than assuming it. All of this rests on the tax rules as they stand for the 2026/27 tax year and those change. We don't manufacture these policies and we earn no commission if you use one, so we have no reason to put you in one unless your own numbers say so.

Question 54

Why do endowment policies have a bad reputation in South Africa?

Accepted Answer

Because for a long time the reputation was earned, and pretending otherwise would be the wrong place to start. Policies sold in earlier decades commonly recovered the selling adviser's upfront commission out of the first years' contributions, so someone who stopped or reduced payments in the early years could get back materially less than they had put in. Fund menus were often restricted to the insurer's own range, and the structure was frequently presented as an investment rather than as the insurance policy it legally is, which kept the conversation away from cost and access.

It would be convenient to file all of that under history, and it isn't entirely. The five-year restriction is still there, access during that period is still limited and capped, and a policy taken out for a reason that stops applying is still awkward to unwind. Those are features of the structure rather than of old selling practice, and they are the reason it suits a narrow set of circumstances rather than a general audience. Early-termination charges on policies sold since 2009 are limited and reduce over time, which softens the worst of the old problem without removing it.

What has changed is that the wrapper can be bought through modern providers on open fund menus, and that an adviser does not have to be paid commission for putting you into one. Commission on these policies is still permitted and still common in South Africa, so it is worth asking directly how the person recommending one is paid. Our own position: our fee is the assets-under-management fee we agree with you in writing, we take no commission from any provider, and we are paid exactly the same whether you use one of these structures or not. We think that matters, because it means the recommendation can only rest on your numbers. If your circumstances don't clear the bar, we will tell you so.

Question 55

I already have an endowment. What are my options?

Accepted Answer

Start by finding out what you actually hold, because a lot of the anxiety around these policies comes from not knowing. Ask your provider for the current value, the annual charges, what the underlying funds are, whether a restriction period is running and when it ends, and what you would receive if you surrendered today. Two things bite on that last point. The amount you may take out during a restricted period is capped by legislation, so the balance stays invested rather than being released. And an early exit can carry a termination charge, which on policies sold since 2009 is limited and reduces each year.

Broadly there are three ways it can go, and staying put is one of them. If the policy was expensive to enter and is now past the worst of that, surrendering can lock in the cost without recovering it, and a wrapper that still suits a top-bracket taxpayer may well go on suiting them, though a drop in your marginal rate can change that. Where the funds inside it are poor or the charges are high, it is often possible to switch the investments within the existing policy rather than exiting altogether, which keeps whatever value the structure still has. And where circumstances have genuinely changed, exiting may be right, but on the numbers rather than on how the policy was sold.

This is worth a second opinion from someone who earns no commission on the outcome. We are paid an agreed assets-under-management fee on the assets we advise on and never a product commission, so no provider pays us to move you. Where money you moved would come under our advice, our fee would apply to it, and we will say so plainly before you decide anything. Reach out to us and we'll go through what you hold, with no obligation.

Question 56

How does tax-free savings work in South Africa?

Accepted Answer

A tax-free savings account (TFSA) lets you invest up to R46 000 per tax year, against a R500 000 lifetime contribution limit, and you pay no tax on interest, dividends, or capital gains inside the account. Exceed either limit and SARS taxes the excess contribution at 40%, so the annual figure is worth tracking across every account you hold.

We treat the TFSA as the first thing every client should use, because unlike every other tax-efficient structure it asks almost nothing in return: no lock-up, no Regulation 28 restrictions, and no penalty for accessing your money. It also suits long-term holding rather than medium-term saving. The benefit is proportional to how much growth accumulates inside the account, so it works hardest over decades: the earlier you start and the sooner you use the lifetime limit, the more of your eventual balance is growth that was never taxed. Withdrawing early is permitted but costlier than it looks, because a withdrawal doesn't restore the room you've used. Money taken out can't simply be put back.

A TFSA sits alongside a retirement annuity rather than replacing it. Retirement annuity contributions are tax-deductible up to the lower of 27.5% of your taxable income or R430 000 per year, which is a larger immediate saving, but Regulation 28 caps offshore exposure inside it at 45% and you can't access the money before 55. A TFSA offers no deduction, but it carries no offshore restriction and stays accessible. Most clients should use both, and the right split depends on your marginal rate, your time horizon, and how much offshore exposure you want.

Question 57

What is the two-pot retirement system?

Accepted Answer

Since 1 September 2024, contributions to South African retirement funds are split into two components. One third goes to a savings component you can access before retirement, and two thirds go to a retirement component that is preserved and must be used to provide an income when you retire. Anything saved before 1 September 2024 sits in a separate vested component under the old rules, and a once-off seed amount of 10% of that value, capped at R30 000, was moved into the savings component.

You may take one withdrawal from the savings component per tax year, with a minimum of R2 000. The detail that catches people out is the tax: a savings-component withdrawal is taxed at your marginal rate, not on the far more favourable retirement lump-sum tables, so an early withdrawal can cost up to 45% of the amount as well as the growth you gave up. We treat the savings component as a last resort rather than an available balance, and we model the real cost before anyone touches it.

Question 58

What is Regulation 28 and how does it affect my retirement savings?

Accepted Answer

Regulation 28 of the Pension Funds Act limits how a retirement annuity, pension fund, provident fund, or preservation fund may be invested, so that retirement savings can't be concentrated in high-risk assets. The main limits are 75% in shares, 45% offshore, 25% in property, and 25% in hedge funds, and no single manager may hold more than 25% of your retirement assets.

In practice it's the offshore cap that shapes planning most. A retirement annuity can't hold the global exposure that a discretionary investment can, which is why we generally build offshore exposure outside retirement structures and use the retirement annuity for what it does best: the tax deduction. Regulation 28 doesn't apply to tax-free savings accounts, discretionary investments, or living annuities. That last one surprises people: the limits fall away entirely once you retire into a living annuity, so your investment choice actually widens at retirement rather than narrowing. Across your whole portfolio, that means you can carry considerably more offshore exposure than the 45% figure suggests.

Question 59

What are my options when I retire: a lump sum or a living annuity?

Accepted Answer

When you retire from a retirement annuity or pension fund you can normally take up to one third in cash and must use the balance to provide an income. The first R550 000 of retirement lump sums you take across your lifetime is taxed at 0%, and anything above that is taxed on a sliding scale. Under the two-pot system the savings component is available as cash while the retirement component has to be annuitised, so your exact split depends on when your contributions were made.

The income decision matters more than the lump sum. A living annuity lets you choose the underlying investments and draw between 2.5% and 17.5% a year, reviewable annually, and whatever remains passes to your beneficiaries. A guaranteed life annuity pays a set income for life with no flexibility and nothing left over. Neither is universally better: the living annuity carries the risk that poor markets and a high drawdown erode your capital, while the life annuity removes that risk and the flexibility with it. Taking the maximum lump sum is rarely optimal, and it's one of the few retirement decisions you can't undo, so we model the alternatives against your actual expenses before you commit to anything.

Question 60

What is a living annuity vs a life annuity?

Accepted Answer

A living annuity lets you control your investments and withdrawal rate in retirement, with flexibility to adjust and to leave what remains to your heirs. It also sheds the Regulation 28 restrictions that applied to your retirement annuity, so your investment choice widens. A life annuity pays a set income for life with no flexibility and nothing left for heirs, but it removes the risk of your capital running down. Most of our clients choose living annuities for the control and the growth potential, though that comes with the responsibility of managing the drawdown rate sensibly. A life annuity can suit those who would rather have a predictable income and make no investment decisions.

Question 61

What is offshore investing and should I do it?

Accepted Answer

Offshore investing means holding investments in foreign currencies and markets outside South Africa. It gives you currency diversification, access to companies and sectors the local market simply doesn't offer, and a hedge against rand weakness. South African investors are particularly prone to home bias, which is worth naming: the JSE is a small share of global markets.

South African tax residents can move up to R2 million per calendar year under the single discretionary allowance. This is the simpler of the two routes: it needs no approval from SARS beyond a valid tax number, it covers investment, travel, and gifts, and you don't have to justify what it's for. It resets on 1 January and doesn't carry over, so unused room is lost each year. Above that you can transfer a further R10 million per calendar year under the foreign investment allowance, which does require a tax compliance status PIN from SARS, giving a combined R12 million per person per year. Retirement structures are separate: Regulation 28 caps offshore exposure inside a retirement annuity or pension fund at 45%.

Our view is that a meaningful share of long-term opportunity sits outside South Africa, so we lean towards building as much offshore exposure as your circumstances sensibly allow, and we use the annual allowances deliberately over successive years rather than in one rush. That said, it's a view rather than a certainty, and the right amount is bounded by things specific to you: your risk profile, your income needs, the currencies you actually spend in, and the tax cost of moving money out. There's no single correct percentage and we don't apply a house allocation.

Question 62

Is it better to invest offshore directly or through a local global fund?

Accepted Answer

Both routes give you offshore exposure, but they're structured differently, and the right choice for you depends on how much you're investing, for how long, and how much complexity you're prepared to take on.

Direct externalisation isn't automatically right. It carries currency conversion costs, ongoing foreign asset disclosure on your tax return, and more moving parts, so it generally suits meaningful long-term allocations rather than small or short-horizon amounts. Below that, a local feeder fund is the simpler and often better answer, and inside a retirement annuity a feeder fund is the only option available. For new clients we often start with feeder funds for simplicity and externalise later as the portfolio grows. We work out which side of that line you're on before recommending either.

Question 63

What happens to my investments if I want to emigrate?

Accepted Answer

This is a common concern for South African investors. We help clients navigate the complex emigration process, including tax clearance, foreign investment allowances, and transferring wealth efficiently. We'll ensure you understand all implications and help structure your investments for your new country while complying with SA regulations. Where a move creates genuine cross-border tax complexity, such as US citizenship or dual tax residency, we coordinate with specialist cross-border tax advisors rather than improvising: the structures that work well for most South Africans can be actively harmful under another country's rules.

Question 64

What is estate planning and why is it important?

Accepted Answer

Estate planning ensures your assets pass to your chosen beneficiaries efficiently and cost-effectively when you die. It includes wills, trusts, beneficiary nominations, life insurance, and estate duty planning. Without proper planning, your estate can face 20%+ estate duty, executor fees of 3-4%, and lengthy delays. We help structure estates to minimise taxes and ensure your family is protected.

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