#Imstaying………..

With all the negativity around our struggling economy we still fair better than many other countries across the globe. Although a bit tongue in cheek these comparisons do shine some light on the upsides of our cost of living in South Africa.

The price of petrol                                                                                                         All countries have access to the same petroleum prices of international markets but then decide to impose different taxes. As a result, the retail price of gasoline is different. 

Price per litre of petrol                                                                                        Average of all countries – $1,12
SA – in spite of the taxes applied – $1,07 
Oil producing countries – pay much less                           Venezuela  –  $0,02 – Emirates – $0,54
Hong Kong – the most expensive – $2,47 
US – the biggest consumer – $0,84 

The Big Mac Index

The index aims to give an idea of how purchasing power parity compares across countries.The idea being that the same components come into play to make a Big Mac. So there is reliance to price.

Switzerland – the most expensive – $7,29

US – where it originates  – $5,66

South Africa – in spite of our high taxes – $2,16

Lebanon- the cheapest – $1,77

So, based on this index the Rand is undervalued by 61,9%.

Wine Prices World Wide

A comparison of mid range wines across the world show that SA is cheaper than most countries by far.

Quatar – the most expensive – $24,72

South Africa – the one of the cheapest – $5,09

Iran – the cheapest – $1,20

So from this somewhat superficial info we can still get a sense that South Africa still offers value being one of the cheaper places in the world where you can drive and get a Big Mac with a glass of wine. 

#Imstaying

The Perfect Retirement Plan……

Early to bed and early to rise makes a man healthy, wealthy and wise. A proverb which provides a strategy for the  – The perfect retirement plan.

You probably will have to work for the rest of your healthy life. The problem of living too long is increasing exponentially as we keep on improving health care technologies and focussing more and more on healthy living. This means that we will need more money to maintain our lifestyles for longer. So as a starting point let’s knock out the illusive concept of retiring at 65.
Rather we should aim well past 65, committing to saving and investing whilst finding ways to generating an income.
At some stage of your life, sooner than later, you will reach a level of financial independence where your investments can maintain your cost of living. This will allow you to work because you want to. There are two areas of your life that need to be in check to help you achieve this – Health and wealth.
So your investment strategy should take on a two prong approach:
Health
Investing in your health. Yes, following a healthy lifestyle of diet and exercise to improve your well being for as long as physically possible. If you maintain a healthy lifestyle you will benefit from being able to enjoy your financial independence. You will be empowered to occupy yourself with things that you really want to do. If what you do is income producing you can continue to save for a longer time being less dependent on your capital and allowing it to grow for longer.
Wealth
Saving as much as possible for as long as possible. The returns on your savings should be re-invested to take full advantage of compound interest. The magical formula for financial success. You want to arrive at a point where your investments can produce enough income for you to live on for the rest of your life. The earlier you start the less it takes. You will eventually be in a position to supplement your income using your investment yields and the money you generate from your occupation.
When your health eventually get’s in the way of keeping up then you can lean on your investments which would be significantly better having saved longer. You also will have lessened the period needed to provide for into the future. This will  take  the stress out of not having saved enough. Health is integral in this plan… look after it…..