Should you be dollar cost averaging?

You've just won second place in a beauty contest

Yes, well done you uber foxy person you, you now have an extra R1.2 million to invest. This is such a common problem, I thought we should address how to handle it. Firstly, I would like to advise against spending it all on hookers and cocaine like this overly honest guy would do. Sure it’s fun, but how much of that month will you actually remember, and after you’ve lost your job, wife and the bridge of your nose, life might just suck a little afterwards. Ideally you’ll invest your winnings, but should you do it all at once, or should you spread out putting it in investments over a year or more?

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You don’t earn nearly as much as you think you do!

Where did my salary go?When I was 24 I thought I’d made the big league. Thanks to a bit of luck and thanks to having F-You money, I ended up in a contracting position where I was earning R160 an hour. That meant I made R28k per month since I worked about 176 hours a month on average. This is a pretty good salary today, but 13 years ago to a 24 year old who was still pedaling his bicycle to class and eating vetkoek for lunch just over two years previously it was an astronomical amount of money. More than double what my last salary was before I took my extended F-You holiday. So what does a 24 year old earning such a large sum of money do with all of it? Invest it? Not a chance, I bought myself an Audi.
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Selfish Old Man disease

Zuma Fire TruckThe world seems to be suffering an epidemic. This epidemic is known as Andro-Parasitic Geriatricus. Commonly known as Selfish Old Man disease.

This disease seems to be on the increase. I believe that patient zero was first noticed in a neighbouring country. The giant festering arsehole life support system to have first shown these symptoms in our region is known as Robert Mugabe. In 2009 Mugabe attended Zuma’s inauguration, where he promptly passed on the disease to our own steaming pile of horse manure President, the not so honourable Jacob Zuma.

Then in 2010 the after South Africa, armed with a briefcase full of hundred dollar bills, were granted the rights to hold the football world cup, Zuma was re-infected with another strain of APG from a certain Septic Bladder. Continue reading

Let’s all be guilty of tax avoidance

Tax evasionTax evasion is illegal, and will quite likely have you ending up with free accommodation. Sadly while free sounds great, it’s not quite the case when your roommate is a rather hefty heavily tattooed guy named Bubba. And Bubba likes you, a lot! Instead, bypass tax evasion and focus on tax avoidance. I highly encourage it. What’s the difference you might ask? To put it simply, one ends up with you behind bars, the other leaves you with more in your pocket to visit bars. In other words, tax evasion is doing something illegal to not pay taxes while tax avoidance is doing something legal to not pay taxes. Companies pay experts very large sums of money to help them tread this very fine line, saving them even larger sums of money in tax.

Now you might think that this is morally wrong, after all we live in a country that needs our taxes. Figures in a 2013 study indicated that just 3.3 million taxpayers are paying 99% of South Africa’s taxes, so is it right for these 3.3 million to try reduce the amount paid? Continue reading

F-You Money

Keep calm and double my salaryApparently I’ve been getting people a little down with blogs on how much money is tossed aside because we like to have nice things, or because we do stupid things. After my last blog I got sent a message from Moneypenny “Now, for your next blog write about something that is not only a good investment but good for the soul (fun) as well.” Challenge accepted. This one is for you Moneypenny.

I’d been working for just under two years when I asked my boss for a quick chat. “I’d like 50% more pay, and an extra 5 days leave every year, otherwise I’m out of here”. I was quick and to the point. He had a sly grin on his face. “Excellent” he said, “let’s go run it past the director and see how he feels”.

I started my first job in matric, grade 12 for you young’uns, waiting tables at the only Baron in Pretoria. It was fun, earning a few thousand a month, while getting free food and an endless offering of dates from mildly inebriated women. There was also the brief stint as a fast food delivery driver, which was a lot easier, but far less profitable. At least I got to snack on the customers food when I was hungry. If you do order from one of the delivery places, and the guy uses a car to deliver, don’t ever expect to get your full quota of chips. You may lose a tasty chicken nugget in the process too. Continue reading

The last house I’ll ever own…


Luxury accomodation on the warm indian ocean, going so cheaply you wouldn’t believe it. Come view now… in Mogadishu!

I’ve written before about how I’m really not a fan of a buy to let property as an investment, but what about a buy to live in property? Luckily for you, I’ve done that before too. In the last property article I mentioned the house with a built-in hole in the back yard for pouring cash into. Well now having just sold the property I can provide some real numbers to answer that question.

The numbers: Continue reading

And the winner is…

Be patient, I’ll tell you in a minute after I build up the suspense and drag this post out longer than the Grammy awards shows.

Anyway, 2014 is behind us, the second year of the competition and the first in which you could sell shares. This obviously meant that there was a little wiggle room for people to break the system. To stop this, initially all shares trading less than 16 times a day, and with a value of at least one rand. That kind of worked, but one smart guy realised that it was possible to make huge profits by using live prices on a trading account to get that 15 minute advantage over everyone else. Fortunately he was honest about it, and allowed us to reset his account. It also created a lot of work for me to put the prices in pending mode now, so that if someone does use live pricing, he’ll have his advantage removed 15 minutes later when the prices update themselves.

So let’s check up on how the market did last year… Continue reading

How much do habits cost me?

Money can't buy you happiness but it can buy you a jetskiIt seems like the cost of something is an easy question to answer. A loaf of bread costs R13, tyres for your car are R800 each and a box of Marlboro are R34. But being an investor, we know that costs aren’t just the sticker price, but also the loss of future income that money would have earned you. Killing some money means that you kill any future money babies (yes Steve I prefer Nedbank’s advertising, though your fees are better…) it would have had too.

So as we all want to be higher grade smartypants’ it’s a good idea to come up with ways to work out what things really cost. Continue reading

Wouldn’t it be great if the markets crashed and gave us free cheese…

Dear Investor Challenge.

I’m scared that there’s a big market crash coming, so I want to know if I should sell my shares now and buy them back later. Unlike new investors, I already have a lot of skin in the game, and therefore a lot to lose.

I only own one share, the company I work for, South African Breweries. But, through all the stock options and my own investments, I now have about R3 million worth of SAB, an amount I don’t want to see wiped out! They’ve done so well in the last couple of years, that now I think maybe it’s time to cash in the profits before they get eaten up.

I also manage to put an extra R10k a month of my savings into SAB, and I plan to up that to keep up with inflation every year. I’m going to retire in about 10 years, so I need to make sure I’m not going to have to live on beans and toast. Any words of wisdom for me?

Mr. Beerholder.

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Your car doesn’t cost you R5800 p/m it costs you a million dollars you fool…

Er I’d better rephrase that statement. You see a short while ago I had a conversation with my extremely beautiful significant other. Not only is she beautiful, but I have a suspicion that she’s smarter than me too, and a successful business woman to boot. Sometimes I wonder if my only contribution to the relationship is my ability to swing tools around with abandon. And that ability often leads to taps with broken handles, or holes in the wall where there should be wall. I’m already on thin ice, and now possibly this post has me jumping up and down on said ice, in stilettos. It’s not a pretty sight…

Anyway, back to the conversation. You see my sexy girlfriend drives a cute little mini. It suits her perfectly as they’re both small, rather cheeky with a sexy rear end. Thing is though, this is her second mini, and other than the colour and interior, it’s pretty much just like the first one. So why is there a new one? “Well it cost pretty much the same as the last one!”… And now to deflect any venom I may encounter, I’ll switch to another example. Continue reading