An investment that opens the doors to saving

Prudent personal finance management is required from consumers in a financial climate that is pressurizing them to adjust their spending patterns. This is particularly important for those close to retirement, but equally so for those who have never had the means to make adequate provision for the future.

“Lion of Africa has taken into consideration consumers’ need for a cost-effective retirement savings vehicle and as a result have recently launched the Lion of Africa Retirement Annuity backed by the Lion of Africa Real Return CPI + 5 Fund,” says Karen Louw, CEO of Lion of Africa Life Assurance. The primary objective of the Fund is to preserve purchasing power whilst delivering real returns; hence it is ideally suited to those who want to avoid significant market volatility.

“In the Lion of Africa Real Return CPI + 5 Fund we use a proven investment methodology that beats inflation which, after all, is what investment is about,” says Louw. Consumers have access to a comprehensive spread of investments that are structured to deliver risk averse retirement savings. This product makes use of inflation-linked bonds and cash to ensure very few negative monthly returns. It makes no use of derivatives, and has a relatively small exposure to shares thereby effectively managing the consumer’s exposure to risk, regardless of the ‘opportunity’. The Fund’s target is a return of inflation plus 5% per annum over any three year rolling period.

The company utilises a “manager of managers” business model with the Lion of Africa Real Return CPI +5 Fund. “By using this model we can access the best available Fund Managers who are prepared to operate in this format,” says Louw.

Louw adds that with a minimum monthly debit order investment of R100, this product allows consumers who operate off a tight budget to start saving for the future. The minimum lump sum investment is R5000. Louw believes that with the Lion of Africa Retirement Annuity financial intermediaries now have an offering for a market who have not been able to afford existing savings products. “Lower income earners, such as domestic workers, who wish to save for retirement can now do so,” says Louw. In addition it is suitable for the self employed who need personal savings and the SME owner who wants to offer a benefit to staff.

The Lion of Africa Real Return CPI + 5 Fund is also a unique investment vehicle and therefore the Retirement Annuity is also a suitable alternative for consumers, who are already saving for their retirement, who want to diversify their retirement savings.

The Lion of Africa Retirement Annuity is tax efficient as contributions are tax deductible within certain limits. In addition low administration fees are charged, so on a premium of R100.00 per month, a minimum of R85.00 is invested and charges do not increase if one invests more giving the consumer real value for money.

The Lion of Africa Real Return CPI + 5 Fund is also available through Lion of Africa Fund Manager’s Unit Trust offering.