At your service, Home sweet home, Ready, steady, go.
The uncertainty and havoc that Covid-19 has unleashed globally and the resultant effect it has had on all of our finances requires a careful look at how we deal with our money. The crisis has divided the global population into two groups. Either you have benefitted, because you had the good fortune to be invested in tech and online shopping, or your finances took a beating with poor investment performance, unemployment or you own a restaurant/guesthouse. Either way, you will need my advice and support. Like you, I do not have a crystal ball, but what I lack in financial fortune telling I more than make up for in experience and focus. During this time you will need support, guidance and expertise. I am at your service.
This year’s Budget Speech was touted as an unprecedented emergency intervention, however it left quite a few questions unanswered. The highly publicised public sector wage bill discussion, quelling wide-spread corruption and just how government plans to make up a more than R300 billion shortfall in tax collection were not definitively dealt with. What was clear, however, was that South Africans will have to cough up more from next year to foot the bill – and they will need sound financial advice to help weather this.
This is going to have a trickle-down effect on us all – bringing the need for proactive, financial advice to the fore. Although specifics around tax and other measures that directly impact consumers will only be fleshed out in February 2021, I will have a role to play in helping you get your finances in order in preparation for what is shaping up to be an expensive 2021 and beyond. Add to this the projected rise in unemployment and you’ll find that income protection and shoring up emergency savings will become a number one priority for many households. We are going to need our financial advisers more than ever in the year to come. We need to preparation, protection and provision.
Preparation for taxes
Tito Mboweni announced the plan for R40bn in tax hikes over the next four years in an effort to boost income. That is going to start with a R5bn increase in 2021. Of course an increased tax burden will mean decreased spending, so consumers will need to seriously and extensively review their financial goals and aspirations to account for these tax increases. Additionally, as the country amasses extraordinary levels of national debt, SARS will certainly adopt a more stringent approach to tax collection. Anyone banking on that tax return is going to need to . . .