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Does anybody here know what they are doing?

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Valued Contributor
maybe, but technology also pushing things down .. books and music for example are both cheaper with iTunes and a Kindle .. as for eskom, yes but that's because we had lower then inflation increases for a decade .. etc ..
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Super Contributor
I agree, when looking over time compounding is very powerful, if one wants everything now, one will not end up like Buffett.
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Not applicable
Small error in your thinking, your R1 mil house costs you about R10k pm in instalments excl the extras. Pay the debt of mortgage off and I very much doubt your annual maintenance costs will be R120k (R10k pm). So you sitting with R10k extra to spend/invest/live when debt is gone....
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Super Contributor
Re.Eskom...a lie repeated often enough...
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Valued Contributor
go find the eskom increases for the 90's vs. CPIx .. tis a fact, but there is a better arguement in those numbers but I'll leave you to find it ..
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Super Contributor
For all these that push the theory of compound interest - has it occurred to them that inflation is coumpounded? A house, if bonded, really isn't an investment at all since the rate of interest payable is considerably higher than the average escallation of the home in a typical year - then add the transfer cost and the sales commission. We haven't even started considering repairs and maintenance and rates for upkeep. The only thing about houses is that its better to own than to rent - but I'd opt to live under someone else's roof anyday! Money in the bank is only ok if you don't have to pay tax on the interest. Once the interest falls into the salary tax bracket, and you earn a good income, honestly - even gold starts looking like the best investment around.
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Super Contributor
but I'd opt to live under someone else's roof anyday! - hint, hint!
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Not applicable
True true, but how do you get it right to pay off your house, if you need cashflow to pay all the other items that skyrocket in price. Who has the ability to pay off their bonds? In current times, I bet about 1% of people can pay off their bonds early. The newspaper stated clearly this weekend, that only 6% of the public can go on pension at age 60. The rest will have to work at least as much as 7 years longer. Investigating different cashflow options, it seems that buying and selling stuff seems to bring in the most bucks. Buy a table at an auction for R500 and sell for R1000. 100% profit. How long will you have to hold shares to get 100% profit? I imagine one heng of a long time!
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Super Contributor
The 412% increase in electricity tariffs between 2007 and 2012 (provided the monstrous 35% annual increases over the next 3 years are approved by Nersa) significantly exceeds earlier CPI shortfalls and has in fact nothing to do with them but rather reflects the extent of sheer mismanagement and gross incompetence of the incumbents and the relevant state dept. An additional perspective on this plundering of state resources is captured in the following link: http://www.moneyweb.co.za/mw/view/mw/en/page292676?oid=341439&sn=2009+Detail&pid=287226
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Super Contributor
That sounds ok in theory, but do you actually do that? I dunno about the rest of the people out there, but when I want something I want to buy in new. What about the costs of storage and reselling it (advertising etc). If you only thought it was worth 500 bucks, what's the odds on finding a guy out there who thinks its worth twice that? You pay off a bond early by buying half the house you can afford. Can afford to bond a 1 mil house - force yourself to settle for that run-down R500k deal in the ***** area. Furnish it with someone elses stuff from that second hand store down the road. Drive a skadonk which you bounce with 3 of your best mates. Listen you your wife complain about the life-style for 7 years until you've paid it all off ..... Our generation have forgotten how to live that way, whereas our parents were raised like that comming out of the cold war!
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Super Contributor
Lol. Find me a man who owns one (unbonded) first!
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Valued Contributor
has nothing to do with what I said .. but whatever ..
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Super Contributor
Geez saash babe. It sounds horribly like you are talking about living within your means. Please don't tell me you no longer buy organic at Woolies.
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Super Contributor
Here is a very practical tip for everyone. Buy a car that you can repay in 36 months and not 60. Once the car is payed off, drive it for another 2 years + and push the old car payment into your bond over that period. Continue to do that and you will save thousands on interest payments. It's sometimes the simple things that save you most. Also pay yourself every month before you pay your bills. I do it by paying a fixed amount into my OST account (where I earn some money market interest) monthly. Psychologically it makes a difference.
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Super Contributor
Well no ... actually I'm generation Y myself. But ye, that's how my dad did it.
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Super Contributor
Good girl. I'm scared that if I wait til I can afford to buy all the things I want I'll be, er, dead.
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Super Contributor
and he .. er.... she ... with the most toys WINS ;-)
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