The Old Diocesan Issue 12 - Magazine - Page 9
Starting early makes a real difference
For students, financial planning often begins with
simple steps: saving consistently, developing informed
spending habits and learning how investments work.
In South Africa, a tax-free savings account (TFSA) is
one of the easiest and most effective ways to start.
Contributions grow free of tax on interest, dividends
and capital gains, making it ideal for long-term goals
such as further studies, buying a home or retirement.
Parents can play a big role here by encouraging their
children to start saving early and even contributing
to a TFSA or unit trust on their children’s behalf.
Over time, these small contributions can grow into
meaningful financial support.
Investors who have cultivated these good habits then
have access to a wide range of investment options,
both local and global. For example, unit trusts and
exchange-traded funds (ETFs) are accessible, costeffective and transparent options for investing in
diversified portfolios. The keys are having a basic
understanding of what is being invested in, investing
regularly, staying invested for the long term and
avoiding speculative behaviour.
The role of family governance
While estate planning involving wills, liquidity analysis
and structures like trusts is foundational where
appropriate, even the best-laid plans can fall short
without something equally important: family governance.
Family governance is about how families communicate,
make decisions and pass on values around money.
It can be as simple as regular family conversations
about finances or as formal as a written family
charter outlining shared values, responsibilities
and expectations.
Good family governance helps to ensure that wealth
doesn’t become a source of conflict. It prepares
children and heirs to understand not just what they
are inheriting but also why and how it should be
managed. This might include teaching basic financial
skills, involving older children in age-appropriate
financial discussions or agreeing on how family assets
will be used to support education, entrepreneurship or
philanthropy. By combining sound financial planning
with clear family governance, families improve the
chances that wealth will be preserved – and used
wisely – across generations.
A shared financial journey
Financial planning works best when it’s a shared
journey. Starting early, investing consistently,
planning for wealth transfer and building strong family
governance can help families create not just financial
security but also a legacy rooted in values, knowledge
and opportunity. Just as you would seek legal advice on
legal matters and medical advice on medical matters,
it is also of the utmost importance to engage the
services of a qualified, accredited financial adviser
when dealing with your financial matters.
