Question:
I am 66 years old. My wife and I have two properties — fully paid — and R2-million in investments with Liberty Life, part of which is in a retirement or pension fund.

We are still working, but would like to slow down and start enjoying a quieter lifestyle.

Rent from one property is R7500 per month and we live in the other one.

We were thinking of placing about R800 000 in the money market which would give us 11.2 percent on a monthly basis with Absa while leaving the rest as an annuity which we could access later as we need it.

Answer:
This time of your life, in terms of your investments, is extremely important. The choices you make now will impact your ability to maintain your lifestyle in the long-term.

If you retire you will be able to take out R300 000 tax free and the next R300 000 will be taxed at 18 percent. It is not a bad idea to take advantage of this tax break.

Much depends on the kind of lifestyle you want. If you invest this money in a money market account you will get an income of around R5000 per month to add to the R7500 per month from your rental property.

You definitely need to go and see a financial advisor who can look at your entire financial situation. I know R2-million sounds like a lot of money, but it may not be enough even if you are fit and healthy. You need to do some scenario planning and lifestyle financial planning to see if you will have enough to meet your objectives.

Remember that interest rates are fickle. Make sure you take into account the possibility of lower rates in the future.