Why you need a lifelong coach to accompany you on your financial journey.
According to recent media report, the South African Revenue Service (Sars) has demanded more than R1 million in outstanding taxes from 13-time Paralympic gold medallist swimmer Natalie du Toit.
Beyond the headlines lies a story that many South Africans can relate to. It’s a story about the “silent gap” that takes place after retirement when the rules of the game suddenly change, and the financial guidance we once relied on often fades away.
The retirement trap: Thinking the race is over
We’re constantly reminded to save for that moment we stop working. We focus intensely on reaching retirement, but we rarely talk about what happens after retirement.
Think of financial advice like a coach. You wouldn’t expect an athlete to compete at the Olympics without a coach, but we often assume that once someone retires, they no longer need “training” – or, in this instance, financial advice. In reality, retirement isn’t the end of the race; it’s the start of a brand-new event with a completely different set of rules.
Post-retirement earnings, new income streams, and the complexities of tax don’t disappear just because you’ve hung up your goggles or closed your office door. In fact, they can become even more tangled.
The taxman’s new tools
It’s important to understand that the world has changed. Sars is now using advanced technology to cross-reference bank accounts and lifestyle spending.
For a retiree exploring “side hustles” or alternative income to keep up with the rising cost of living, it is incredibly easy to trip up. Without a professional standing by your side to say, “Wait, if you earn money this way, you need to set aside a portion for the taxman,” many people find themselves in a hole they never intended to dig. This isn’t usually a case of trying to cheat the system; it’s a case of not knowing the system has changed.
Why “once-off” advice isn’t enough
Many people receive a payout or start a pension and think, “I’m sorted.” But financial health is like physical health – it requires check-ups.
- New income streams: Many retirees take on consulting work or small business ventures. Each of these has different tax implications that a simple “retirement plan” from ten years ago won’t cover.
- Inflation and interest: Penalties and interest can turn a small mistake into a mountain of debt very quickly.
- The information gap: Rules regarding Sars, dividends, and provisional tax change almost every year. If you aren’t a financial expert, how are you supposed to keep up?
Empowerment through partnership
Sars’ new and more advanced tools are a wake-up call for all of us to be more proactive about our futures and a reminder that financial advice should be a lifelong partnership. An adviser isn’t just there to help you save; they are there to protect what you’ve already built. They act as your navigator, helping you avoid the hidden rocks beneath the surface of the water. Seeking help isn’t a sign of weakness or failure – it’s an act of empowerment. It’s saying, “I worked hard for my legacy, and I’m going to protect it.”
A path forward
To those currently in retirement or approaching it: don’t be afraid to ask for a “second half” coach. Look for a financial planner who speaks your language, who explains things simply, and who checks in on you regularly – not just when you have money to invest, but when you need to navigate the tricky waters of tax and income.
Retirement doesn’t have to mean going It alone; instead, bridge the gap with a trusted financial adviser.
By Cebile Zibi, Head of Trade Marketing at Momentum Advice.