Scary truth about RAs – they decimate savings

if you are contributing to an RA, or thinking of doing so, take a close look at the facts provided by Brenthurst Wealth Management founder Magnus Heystek.
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One of the biggest personal finance mistakes I have made is buying into the idea that a Retirement Annuity (RA) is a smart way to save. Year in and year out, I've set aside a sizeable chunk of my earnings to invest through an RA.

But, the little bit of tax that has been saved pales in comparison to the lack of underlying growth and the opportunity cost of investing elsewhere. I am some way off the date at which I can release some funds from an RA, so my money is stuck. Hopefully some of my other steps to provide for a pension will pay off in due course.

In the meantime, if you are contributing to an RA, or thinking of doing so, take a close look at the facts and figures provided by Brenthurst Wealth Management founder Magnus Heystek: Retirement annuities have decimated your savings.

Reasons for the poor performance range from the dismal returns from SA assets to the fees for the various mouths in the chain between you and your investment products.

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Comments to my inbox – 'You've got it wrong on RAs'

You can't drop a bombshell about RA's not being a smart way to save by only taking into account Mr Magnus's view. You're misleading your viewers. And as a Personal Financial Advisor myself and i feel vindicated by your misleading statement. If you need evidence on how RA's are the best way to save, try submitting your tax returns, then you'll see the importance of RA's. And i suspect you haven't heard of the 27.5%.

OM

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