You need this Retirement Survival Strategy…

Fsp Invest, 06 Aug. 2013

Tags: retirement, low interest rates, high yielding investments, dividends, preference shares, listed property, inflation linked retail bonds, income, generate income, investments,



Interest rates around the world are at record low levels. This is actively destroying the livelihood of retirees. Read on to find the strategy to survive in a low interest rate environment…


This Retirement Survival Strategy will help you weather the low yield income storm, reveals Warren Jeffery, Chairman of The South African Investor.

Four easy ways to help you generate income from your investments

The Retirement Survival Strategy shows you four low risk investments to help you generate enough income to stop you having to draw down on your capital.

#1. Buy inflation linked retail bonds
When you rely on investment income, your biggest enemy is low interest rates that can’t keep up with inflation.

Your first goal should be to make sure, at the very least, your savings beat inflation. And this is what makes inflation linked retail bonds such a great option.

You can buy these bonds online by going to www.rsaretailbonds.gov.za or you can even buy them at your local Pick n’ Pay!

#2: Invest in listed property
Over the last four years, listed property has been the JSE’s top performing sector. Not only does it return great capital growth, but it also offers you fantastic income in the form of distributions.

#3: Invest in preference shares
This investment asset can deliver exponential gains as soon as inflation starts to climb or interest rates rise.

Preference shares act like a loan to a company. But instead of having a set amount that the company has to pay back, you as the lender (investor) get ownership of a preference share.

This share entitles you to returns at a set rate.

As inflation rises, and the likelihood of an increase in interest rates increases, the share price of a preference share climbs. Then when rates actually do increase, the income you receive from your preference share will increase as well.

#4: Invest in dividend paying companies
One of the best ways to invest for income is to invest in growing companies that aren’t shy about sharing profits with investors. These companies do this by paying out steady and hefty dividends every year.

Well-chosen dividend shares will easily secure you an income of around 6.5% on top of any capital growth.

There you have it, a strategy to survive in a low interest rate environment.


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