Hexon Fairweather

Financial Friday – “Invest in your financial education – it's the best investment you can make”.

Spending time and effort to learn about how to manage your money wisely and make informed financial decisions is a valuable investment you can make. Educating yourself about finances can lead to better financial outcomes in the long run.

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Financial Friday - What is a Retirement Annuity?

A Retirement Annuity (RA) is a voluntary, long-term savings plan designed for individuals to save for retirement. It includes tax benefits, a range of investment options, restrictions on accessing funds before age 55, and the option to use the accumulated funds to purchase an annuity or receive regular retirement income. RA's are also portable, allowing individuals to continue contributions even if they change jobs.

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Financial Friday – What is real investment return?

A real investment return is the net gain or loss on an investment, factoring in inflation. It reflects changes in your investment's purchasing power due to price fluctuations. For instance, if an investment yields a 10% gross return in a year with a 5% inflation rate, your real investment return is 5%, indicating a 5% growth after inflation adjustment.

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Financial Friday - “The secret of getting ahead is getting started. The secret to getting started is breaking your complex overwhelming tasks into small manageable tasks and then starting on the first one.” ― Mark Twain

To secure a prosperous future, the first step is often the most crucial one — getting started. The complexity of financial decisions can be overwhelming, but the key is to break them down into smaller, manageable tasks. By taking that initial step towards budgeting, saving, and investing wisely, one can pave the path to financial success.

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Financial Friday - What is dread disease cover?

Dread disease cover, also known as critical illness insurance, provides financial protection for individuals in case they are diagnosed with specified critical illnesses like cancer, heart disease, or stroke. It offers a lump-sum payment to help cover medical expenses and other financial obligations during illness.

Pilots are exposed to unique occupational risks, such as high-altitude radiation and irregular schedules, which can potentially impact their health. Having dread disease insurance can provide peace of mind and a safety net in case they face a serious health setback.

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Financial Friday - What is capital gains tax?

Capital gains tax is typically attracted when you sell or dispose of assets like stocks, real estate, or investments, and you realise a profit from the sale. In other words, it's triggered by the sale of assets that have increased in value since you acquired them. Capital gains in South Africa are taxed by including them in your taxable income, subject to certain exemptions and deductions.

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Financial Friday - Why do you need life cover?

Life cover is essential for ensuring the financial well-being of your loved ones in case of your passing. Beyond the emotional support, a life insurance payout offers a practical safety net. It helps settle any outstanding debts, such as mortgages or loans, preventing the burden from falling on your family. Additionally, life cover assists in replacing your income, especially if you're a primary earner. This lump sum payment supports your family's day-to-day needs and future goals, ensuring they can maintain their financial stability during a challenging time.

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Financial Friday - “Money, like emotions, is something you must control to keep your life on the right track.” ― Natasha Munson

Conscious spending is like making thoughtful choices with your money. It means thinking about what you buy, why you're buying it, and how it fits into your overall goals and values. It's a way to spend money in a more intentional and mindful way, focusing on what truly matters to you.

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Financial Friday - What is a Unit Trust investment?

A unit trust, similar to a mutual fund, is when many people pool their money together to invest in different things like stocks and bonds. People who join buy units, which are like pieces of the overall investment. The value of these units changes based on how well the investments do. If the investments go up in value, the units become worth more, and if they go down, the units become worth less.

Unit trusts are good because they spread out the investments, are managed by experts, and let lots of different people invest even small amounts. This helps people access investments they might not be able to do on their own.

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Financial Friday – “Do not save what is left after spending, but spend what is left after saving” – Warren Buffett.

In “plane” terms, if a pilot does not prioritise setting aside money for the future, then they’ll likely never find the time to actually do it. Consequently, when they require those funds, they won't be available. Initiating and consistently following a savings strategy is a decision you should never feel remorseful about.

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Financial Friday – What is estate duty?

Estate duty is effectively tax that is paid on the transfer of wealth from a deceased estate to the beneficiaries. Estate duty is levied at a rate of 20% of the dutiable amount of an estate up to R30 million, and at 25% of the dutiable amount of the estate where it exceeds R30 million.

In “plane” terms, when a wealthy pilot passes away, they leave behind all their money, property, and assets, which is called their estate. SARS wants a share of that wealth, so they impose a tax called an estate duty.

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Financial Friday - What is “loss of licence” cover?

“Loss of licence” cover is own occupation disability cover specific to pilots. It provides a pilot the opportunity to claim an insured amount should they be considered medically incapacitated by their AME and consequentially have their pilot’s licence revoked. As a pilot can lose their medical for relatively minor health issues, they are generally more sensitive to claims.

Have a great weekend!

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