I have just retired from work and expect a lump sum amounting to about R1 million.I would like to know if I should invest the whole amount short term or pay off the debts and invest the remainder.It is a good idea to contact a financial planner, especially near retirement, as it is important to understand how your income and lump sum can be used to meet your retirement needs.
Generally, it is a good idea to settle debts before you retire, as your retirement income is fixed and you don’t want to be using it to pay off debt. If you need to supplement your income, you would need to consider income-generating investments. Given that what is left of your lump sum would not be a large amount of money, products like the RSA Retail Savings Bond could be an option.If you did not require any additional income, you could invest the remainder in a longer-term investment such as a market-related unit trust or exchange-traded fund.