Retirement is a life journey
Riaan Botha • May 2, 2025
Retirees’ needs differ according to their age. The needs of a 66-year-old differ from those of an 86-year-old. Dr Elisabeth Kübler-Ross, an American-Swiss psychologist, has summarised the life journey’s five phases of retirement as follows:
- The phase of imagination. This period covers the 15 years or more before retirement when people start to imagine or visualise what their retirement will look like one day and how they will enjoy it. This is when they actively plan what finances they will need to enjoy their planned retirement.
- The phase of anticipation. This period begins about five years before retirement. Excitement increases as the retirement date approaches and more specific plans for enjoying retirement are made. Travels are identified and a possible retirement address is discussed. Appointments are made with a financial adviser to determine whether sufficient retirement funds will be available for the planned retirement.
- Liberation. The planned day of retirement has dawned and you experience mixed feelings about the freedom of retirement, the loss of the security of a permanent job with an income and your dependence on your retirement income. The excitement of the new freedom accompanying retirement is estimated to last about two years.
- The phase of reorientation. During this period, the new circumstances of life and opportunities of retirement are enjoyed. These new challenges bring new happiness. Although health and financial issues arise, most retirees enjoy this period which lasts about 15 years.
- The phase of adaptation: During the following years, adaptation occurs, along with the acceptance of an increase in illnesses and restricted movement as part of the limitations of old age. The increasing loss of loved ones and the resulting grief and longing become a part of your existence. More attention is given to the bequeathing of affluence.
Retirement is not a solo journey without the family
With retirees now reaching higher ages, even four-generation families including parents, children, grandchildren and great-grandchildren are becoming more common. Multigenerational families living in the same city, town or even household ensure that ageing family members do not become isolated or lonely. This prevents retirement from being a solo journey without social support.
Because of the reality that large numbers of young people are leaving South Africa to go work within an established economy internationally, many local retired parents’ children live in other countries. The advanced digital age in which we live, fortunately, makes it easy to maintain contact with overseas family members, but this does not replace personal familial care.
How to invest in a volatile market: 3 Principles to keep in mind ‘In the short term, markets can be very volatile depending on which news story makes headlines. However, over the longer-term investors are always rewarded for staying invested and riding out the waves.’ We know this by now, we have heard it many times before and historical data proves it. Yet it’s easier said than done. When it gets to our own money we are emotionally involved and there is a part of us that believes that this time, it might indeed be different. What if the markets never recover and I suffer permanent capital loss. And with the increase power of AI and social media, it feels like my portfolio hangs on the thread of a single Tweet. In this article Stephen Bernard, an actuarial analyst form our partner Allan Gray share his views, backed by statistics and historical evidence: Read the article here: https://www.allangray.co.za/latest-insights/markets-and-economy/how-to-invest-in-a-volatile-market/
In an increasingly interconnected global economy, South African investors are finding compelling reasons to look beyond local borders when building long-term wealth. Offshore investing offers access to broader, more resilient markets, particularly in developed economies with stronger currencies and more stable political environments. Given South Africa’s constrained economic growth, fiscal uncertainty, and the rand’s vulnerability as an emerging market currency, allocating a portion of your portfolio offshore can serve as both a growth engine and a hedge. Investing offshore provides exposure to world-leading companies, industries, and fund managers that are often unavailable in the local market. It allows investors to participate in innovation-led growth in sectors like technology, healthcare, and clean energy, which are typically underrepresented on the JSE. Most importantly, it supports diversification—not just across asset classes, but across geographies, currencies, and economic cycles—reducing concentration risk tied to the South African economy. Key Reasons to Invest Offshore: Diversification: Reduce reliance on South African markets and benefit from a broader global opportunity set. Currency Hedge: Protect your wealth against rand depreciation by investing in hard currencies. Global Access: Gain exposure to top-tier international asset managers and world-class investments. Growth Potential: Participate in faster-growing economies and industries driving global expansion. Important Considerations for South African Tax Residents Before investing offshore, it’s essential to evaluate how your investment aligns with your broader financial planning, particularly around access, succession, taxation, and estate planning: Flexibility: Will you have access to your funds when needed? What types of investments can you hold? Succession Planning: Can your investment be transferred to your heirs? Will Capital Gains Tax (CGT) apply? Tax Compliance: Is the structure tax-efficient, and what must be declared on your tax return? Estate Structuring: Will your investment attract foreign estate duties? Is an offshore executor required? An Efficient Offshore Solution: The Offshore Wrapper A tailored offshore wrapper can simplify many of these complexities, offering a cost-effective and administratively streamlined solution. Key benefits include: No exposure to offshore estate duties No South African executor fees on death No inheritance tax in the offshore jurisdiction Ability to nominate beneficiaries directly for smooth succession Creditor protection for assets held within the structure Consolidation of various investments (e.g., share portfolios, funds) under one structure Minimum investment from $25,000 Tax Treatment The offshore wrapper also provides significant tax efficiency: Taxes are calculated and settled annually by the platform—no action required by the investor CGT is capped at 12%, and income tax at 30% Taxes are applied to USD returns, meaning rand depreciation is not taxed Reach out to me at ruvan@bovest.co.za for more information. Ruvan J Grobler RFP™ (PGDip Financial Planning)
