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HEALTH STRENGTH FITNESS AND A BEAUTIFUL BODY - SIDNEY WILLIAMS
TO GAIN ACCESS TO SIDNEY'S BLOGS AND GUINNESS WORLD RECORDS COMMUNITY.
SIDNEY COAD WILLIAMS
HEALTH ACTIVIST.
Wednesday, November 18, 2009
MAINTAINING THE BUYING POWER OF YOUR INVESTMENTS.
The purpose of investing in a financial product is to exceed or at least maintain the buying power of your investment over a given period especially long term.
EXAMPLE:
Invest one thousand rand, dollar or othe monetary equivalent at 10 percent per annum.
ONE THOUSAND RAND AT 10 % PER ANNUM = R100-00 IN INTEREST.
Deduct tax at 40 percent per annum on the interest earned = R.40-00
Balance after TAX deduction = R.60-00
Deduct inflation at 5% per annum of R1000-00 . =R50-00
THE NET GAIN ON THE INVESTMENT
= R10-00
If inflation is higher than the 5% depicted above then the net gain will turn into a net loss.
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