30 January 2023
The concept of certainty and whether it is real, is something that has kept philosophers busy throughout the ages. Apparently, the philosophical search for certainty dates to Socrates and Plato. It is amazing to realise that people born 2,491 years ago, had already wondered about whether one can trust anything with certainty. These ancient philosophers then debated and wondered about the correlation between certainty and ‘knowledge’, ‘logic’, ‘predictability’ and ‘causality’.
Let’s move forward many hundreds of years, to the early twentieth century, when two British philosophers debated the issue. G.E. Moore concluded that one cannot be certain unless you know it. He said that if nobody knows a particular ‘thing’, the thing could still be true, but it cannot be certain. Ludwig Wittgenstein disagreed. His view was that knowledge was radically different from certainty. Wittgenstein argued that certainty is not correlated to ‘understanding’ (he called it seeing) that something is definite, but rather connected to one’s own actions.
Perhaps certainty is then, after all, something that relies on each one of us personally knowing, seeing and reacting positively to make it real.
Emily was a 42-year-old schoolteacher when she was involved in a serious car accident (in which her husband also tragically passed away) at the beginning of 2021, which left her permanently unable to work. Emily was left to raise their thirteen-year-old twins by herself. Before the accident, Emily earned R23,000 gross income per month. Emily received a total claim value of R8.2 million for the accident and death of her husband and therefore had this amount available in cash and needed a solution that would take care of her and her children.
Emily needed:
What Emily opted for in December 2021:
Emily spent all her available funds on crafting a sustainable solution for the future. The rate she received on the fixed return plan in December 2021 was 6.11% with a projected maturity value of R1,344,988.09 in 2026. In January 2022, there was an unfortunate legislative development around the value of assessed losses available to corporate taxpayers. This change was unforeseen and meant that Emily’s rate on her fixed return plan would reduce from 6.11% to 5.80%, leaving her with a deficit of R14,351.64 on the amount needed for her children’s tertiary education.
If Emily had chosen a Sanlam fixed return investment, she would have received an amount of R1,344,988.09 maturity value in 2026 as the company recently announced they were absorbing the impact of the legislative change on behalf of their investors for this particular solution.
Needing certainty to help one plan for the unforeseen changes that happen is a somewhat difficult task if one considers the philosophical question as to whether you can ever really be certain of anything. If certainty is relative to an individual and what they know, see, understand, and act upon then it really does leave us with trusting our instincts when choosing financial partners.
Trust is generally defined as an assured reliance on character, strength, ability and truth. Trusting in the promise of certainty requires confidence on many levels. Van Gogh is quoted as saying that for his own part, he knew nothing with any certainty, but that the sight of the stars made him dream. This is probably true for most of us but at the very least people should have confidence in the partners they choose. Partners that have the experience and track record of knowing, seeing, understanding, and reacting to make dreams come true with the most certainty plausible.
All monetary values in this article are assumptions for illustrative purposes only. As markets fluctuate and every client is different, values, rates, and incomes will vary.
This article first appeared on Glacier Insights.
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