lumpsum cash or living annuity

[r888]

So i had the option of deciding ..on a cash lumpsum after tax of my late.husbands.pension.2mil950 tax(1mil1hund) or a cash portion out and the remainder in an annuity .Im 38 urs.old.and altho the annuity would of.saved me tax.

I felt in the.long run it would of not lasted me plus all the annuity fees ...so i opted.for the after tax amount...and fixed.it in a 5yr and 2yr fixed.deposit with great interest rates.What would u have done?

[Dave A]

What interest rate are you earning on the fixed deposit?

Why didn't you diversify across different asset classes?

[Basment Dweller]

We don't know your current situation, so can't comment on what you should do, I can only comment on what I would do.

I would've paid the taxes and cashed out the lot. then reinvested all of it and get back to work as if nothing happened.

If you have an existing business or a flexibond you will have a better return putting your money into those vehicles rather than an annuity. With a bond paid off you will have extra cashflow from rental money. You could use the extra cashflow and lumpsum amounts to buy more property and scale your portfolio.

I always have the view that you should treat unearned windfalls (insurance, inheritance etc) as money that should be dedicated to long term investments. Never spend the capital, this money should not be used for vacations, cars, furniture or other things that will cost you in depreciation, time, storage and general effort. It should be reinvested and forgotten about as if it didn't exist in the first place, then get back to work as per usual.

[r888]

I fixed. A portion at 10%p/a and a portion at 8%p/a in a flexi account were can also make deposits .i left a portion uninvested.to take care.of excutor fees and other charges that may be related.to the.will.

IM not very familiar with asset classes but what would u recommend as a good tax saving investment?

[r888]

I did exactly that i paid tax...
and withdrew the balance
..my only income is going to be from the interest earned which amounts to about 270 000 for the year ....i have med aid gapcover and daily monthly expenses ...which has too be paid from this ...any idea how the tax for the coming year is going to be and how i can really reduce it?