How I accidentally grew up and bought life insurance

A shadowy group called the Financial Sector Conduct Authority has warned people to be cautious of unauthorised financial advisors – “influencers” who give advice through social media.

I have always paid scant attention to matters concerning money, especially when it appears in advice columns.

But last week, instead of rolling a massive joint from the front page of Personal Finance that would take at least three people to hold and a flame-thrower to light, I read a feature headlined, “How your retirement plans might fail you.”

I took this as a sign of growing up and it disturbed me a great deal, but not as much as it did to discover there was a good chance I’d be destitute long before my first hip replacement.

The only silverish lining is that I took out a couple of policies years ago. It almost certainly wouldn’t have happened if a friend hadn’t suggested it.

Sponging drinks off him one night, he said I should get in touch with his financial advisor. I suggested he desist from such depressing talk and buy another round.

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In return, he sketched a picture of me in 20 years, living in a cardboard box on the N2, drinking wine from a plastic bottle and eating my toothless girlfriend’s toes.

I have never responded well to advice from people who have my best interests at heart, but this time I followed up on it and gave her a call. She suggested we meet at a coffee shop.

This wasn’t a good start. My idea of a financial advisor was someone who’d insist on meeting in an underground parking garage at 2am.

I believed then, as I do now, that the deliberate accumulation of wealth is a dark and treacherous affair and negotiations are best conducted out of the public eye. Or, at the very least, in a dive bar where the taxis don’t run and the tequila is cheap.

She was impeccably dressed. Her make-up was perfect and her shoes matched the colour of her nails. I knew right away that I was either going to spend my retirement in the Bahamas or in a homeless shelter. It was a gamble, possibly the biggest of my life.

I asked if everything went pear-shaped, could she at least guarantee me a spot in a homeless shelter in the Bahamas. She gave me the lazy eye and picked up the menu.

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“What would you like,” she said. I thought for a bit, then said I’d like to retire at 45 with enough money to never again have to sit in rush-hour traffic, take guff from mental midgets or have to settle for 21 days leave a year.

“I meant,” she said, “what would you like to eat.”

Suspecting that this could turn into more of a mugging than a blessing, I opted for a liquid lunch. She wanted a guarantee of my money, not my temperance.

One finds drinking often helps to blunt oneself to the trauma of dealing with numbers. However, it also makes one inclined to sign whatever it takes to hasten the end of the horror.

Life insurance, disability, dread disease, retirement, death, funeral. Would you like a will with that, sir? May I validate your parking? Teddy bear for the blind? Hell, yeah. I’ll take it all.

Every month for years after that meeting I would look at my bank statement and say: “What the hell is this?” I didn’t really want to know. Making inquiries would only have confused me more. I assumed somebody out there knew what was going on and that would have to do.

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And then, not too long ago, it happened. Policies fell due. Out of the red and into the black. Just like that. I rushed to the nearest bottle store and bought it.

Then I went to my father’s house for lunch and told him the happy news. He nodded slowly and stroked his long white beard. “That’s nice,” he said. “I just hope you’ll come out with more than if you’d invested in the stock market.”

I told him I was going for a wee, then jumped the fence and ran for my car. I can’t imagine anything worse than sitting down with a calculator and finding out that I would’ve made far more money buying shares in, say, Shoprite.

Then things turned weird. Apparently, I couldn’t get my hands on all the money I’d paid over the years. It was my money, but also it wasn’t. Schrödinger’s nest egg. Instead, I was allowed to take one-third of the value of the policies in plastic bags full of untraceable banknotes.

The remaining two-thirds had to be invested in an atrocity called a living annuity. From this, I could withdraw no less than 2.5% and no more than 17.5% a year.

My advisor advised me to err on the side of caution. “The safe drawdown rate for a balanced portfolio is 4%.” I don’t know if I have a balanced portfolio. Not because she hasn’t given me the information. She has.

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But you can only say: “Sorry, would you mind explaining that again?” so many times before you have to smile and walk away.

“You don’t want to start digging into your capital too soon,” she said over the phone. It’s a lesson that comes way too late in life. When I was a kid, my pocket money would disappear within the five minutes it took me to run to the corner shop. I didn’t always spend it. Most of the time it would fall out of my pocket and be lost forever. My sister would save hers. She’s probably a multimillionaire today.

So it was a gamble, and, like all gambles of any consequence, one must calculate the odds. But this one was trickier than most.

Brain: “Take the 2.5%. You are going to live a long time. Make it last.”

Gut: “Don’t f**k around. You could be dead by Friday. Take the 17.5%.”

Ideally, I suppose, Big Brother’s piggy bank would finally part with the last of my money and I would blow it on something that would make me very happy and then kill me. I expect it will be a woman.

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