SA policies in Aus?

[Nog Een]

Hello all you clever people,

I am coming over on a 457 and the question is now what to do with exisiting Sanlam/Old Mutual life policies?

I have not yet read the fineprint on the policies concerning liaibility outside of South Africa. What did you do? Do you cancel and take out new policies in Aus or can you keep the SA policies?

Then, a relocation agent told us that we should not pack our SA wine collection in the container as there are heavy import duties on alcohol? If this is the case, it is going to be a mean going away party

Go well and see you in Aus soon.

A.

[Springbok]

I am coming over on a 457 and the question is now what to do with exisiting Sanlam/Old Mutual life policies?

I have not yet read the fineprint on the policies concerning liaibility outside of South Africa. What did you do? Do you cancel and take out new policies in Aus or can you keep the SA policies?

Contact Andro on this forum - he should be able to steer you in the right direction.

[Mara]

My suggestion is that you email customs and ask them what you will be charged as duty when you bring in your wine. They can be contacted at information@customs.gov.au

We had the same problem, we left our wine with our son in NZ, at the time we were going to Queensland and they had a high import duty. When we got to Victoria, we found out that it would have been less to bring it in here. As it is 9 years ago, I cannot remember what the costs were. In your email to them make sure you say that you are coming to Melbourne, as it may vary from state to state. Also, would you be able to get a South African valuation, bottle by bottle? They base the import duty on the price paid in SA and if you do not have proof, then they base it on an Australian equivalent, which could cost you a whole lot more.

With regard to the life policies, we got all the documentation to surrender our life policies, completed them, just left them undated. We then left the documents with my sister who has our general power of attorney. Once we arrived in NZ and took out new policies, we had my sister submit the documents, which then cancelled the policies and they paid out their surrender value. Hope that helps. Ours were also with Sanlam and Legal and General.

Mara

[Pisces]

Hi Nogeen

I had Sanlam policies, and had to surrender them, apparently as per the Sanlam person I spoke to if something happens to you and you are not in the country, the money goes into a trust and only pays out to the beneficiaries, should they be resident in South Africa.

[ottg]

Most advice delivered on this thread is correct however the advice depends if you emigrate or if you are resident "permanently" in Aus. The rules also differ for endowment policies, RA and Pension funds. I have been through this process myself. If the interest in the forum is large enough I will be able to provide a one-on-one facilitation for the Perth area. Please register your interest directly with me!

Make endowment policies paid up. This is a bad investment which cannot grow because of the life cover it provides (see RAs below). The life cover cost dilutes the investment power. If life cover is required rather get a pure life insurance policy and once settled in Aus cancel it, after obtaining your new life cover in Aus.

As was stated elsewhere you cannot have access to your RAs or Pension fund before your retirement age of 55. A special application can be made to the Board of Trustees but the fund rules will override. This situation is not so bad because as far as I know, no where in the world have pension funds ever be seized by a Government. The argument is that RAs and Pension funds were tax deductible and therefore are taxable if taken before retirement. Now what to do with your RAs and Pension funds before retirement date. HERE is the trick - manage it yourself and grow it but don't feed it.

RAs:They consist of two portions a. Insurance b. investment portion. Now, if you have wondered why your RAs have performed so badly based on the monies invested. Well this is because of the high cost of the life insurance portion. CHANGE your RA to a pure investment vehicle. If you are with Sanlam go for a Stratus type policy and select from various fund managers (Coronation, Allen Gray etc) a portfolio that suites the investment markets at that time. Continuously monitor the RSA market and switch to a different asset when needed. This requires that you follow the RSA economy and be aware of the different assets available. While the management fees are slightly higher your net growth will be higher as well. You don't need a degree to be able to do this, I can show you how! All markets are cyclic and therefore your investment must not remain static.

Pensionfunds: Make sure that you are not "locked" into the pension fund of your last employer. Ensure that you place your Pension into Preservation fund (advantages mentioned elsewhere) and ensure that the new fund rules allows for the transfer of your funds to any other approved fund administrator that complies to the Prudential Guidelines as stated by the Financial Services Board. The new fund administrator also has various options available from where you can select fund managers as for RAs above. Choose a administrator with low management fees is important and select reputable fund managers based on performance.

Pensionfund: Self management: This is the ultimate where you select a fund administrator and an asset manager which is also an on-line broker. Once this non-discretionary account is setup you can buy and sell the underlying assets directly on the JSE self. Note you may never withdraw the money. This way you can even outperform the ALSI. Yes, there are still management fees applicable (even if you do the work yourself) plus brokerage and Strata fees per transaction. But because your pension fund is a long term investment there will be few transactions (2-10 per year) and overall you will outperform most funds because you will make the profits/losses directly. This requires that you follow the RSA economy and are aware of the different equities, bonds, guilts and property stock available. While the management fees are slightly higher your net growth will be maximized. You don't need a degree to be able to do this, I can show you how!

At Retirement:Besides all the deductions possible at retirement (stated elsewhere) you have to purchase an annuity with the remainder 2/3 of the funds. HERE is the trick - some administrators fund rules allow a self managed annuity. Now it is possible to grow your Annuity WHILE you are receiving a pension. This is based on the process described above for self management. This part I haven't done yet but if the interest in the forum (one-on-one) is large enough I will look into this. Note that the portion that you are allowed to take in cash is taxable at the average of the prior two year's rates. My question is because you are not a RSA resident at what rate will this be??

As an illustration if you have R100k in an employer's pension fund it may grow at inflation + 2%. Over 10 years it may be worth R162k. If you do self management the growth of ALSI + 4% is easy achievable. Over 10 years it may be worth R730k.

There are small variants on the above and I may be able to assist you! Note that this process is very administrative intensive but it can be done!

Hi Nog Een

Kyk na my kommentaar op die die forum!

Dit hang af van elke persoon se eie behoeftes, die grootte van die portfolio en die gewilligheid om dit self te bestuur.

"RAs:They consist of two portions a. Insurance b. investment portion. Now, if you have wondered why your RAs have performed so badly based on the monies invested. Well this is because of the high cost of the life insurance portion. CHANGE your RA to a pure investment vehicle.

If life cover is required rather get a pure life insurance policy and once settled in Aus cancel it, after obtaining your new life cover in Aus."

[Nog Een]

Hello Otto,

Baie dankie vir die deeglike verduideliking.

Thanks to all for sharing your experience.

I now have more insight into what to do.

Go well,

A.

[Guest Karooseun]

Hello all you clever people,

I am coming over on a 457 and the question is now what to do with exisiting Sanlam/Old Mutual life policies?

I have not yet read the fineprint on the policies concerning liaibility outside of South Africa. What did you do? Do you cancel and take out new policies in Aus or can you keep the SA policies?

Then, a relocation agent told us that we should not pack our SA wine collection in the container as there are heavy import duties on alcohol? If this is the case, it is going to be a mean going away party

Go well and see you in Aus soon.

A.

What policies if it is political,no not interested

[Gee]

What policies if it is political,no not interested

Karooseun

Please explain your posting to this forum above??

your input does not make sense and adds no value

[Bob]

What a lot of South Africans don't realise is that if you work in Australia, you get 9% of your salary/wages paid, by your employer, into a Superannuation scheme for you, so that you can access these funds to supply you with an income stream over and above the standard Old Age Pension for an Australian.

Superannuation schemes invariably offer life insurance for their clients at a nominal fee each week / fortnight / month.

My wife pays a paltry $1 a fortnight into her Super account to provide her with life insurance in case she dies. I get the benefit, which is greater if you are younger.

Anybody still paying for life insurance in South Africa needs to read what it will provide and what the life insurance in Australia, attached to your super will bring in.

I remember a bloke at work who paid for "this insurance" and "that insurance". I looked at his policies and asked him why he had taken out "income protection"?. . . . . . his job gave him 12 months on full pay as it was if he was unable to work due to illness or accident!!! Why pay hard earnt cash for something that you aren't likely to see the benefit of? . . . . but there you go!

Do your homework and check the fine print. It may pay you to "realise" the value of your policies in South Africa on the strength of being able to get cheap life insurance thro' your work superannuation in Australia in the future.