Investors who are near or already in retirement face the most challenging of investor needs: simultaneously investing for both immediate income and long-term growth.
Most retirement savers consider two options when it comes to purchasing a compulsory post-retirement income: a traditional guaranteed annuity or a living annuity.
While we do believe equities will help retirees beat inflation, we have long argued the need for a more conservative asset allocation among those close to retirement.
Over the very long term, South African equities have delivered better returns than any other market in the world.
The typical retiree who draws an income from a living annuity needs to plan for 25 – 30 years, can expect a relatively high inflation rate and, for at least the next 10 years, should expect relatively muted returns.
Coronation offers two funds that meet the needs of income and growth investors – Balanced Defensive and Capital Plus.