Get bang for your buck
SMART INVESTING: How to navigate tax-free savings accounts
Tax-free savings accounts offer an easy entry to investing. But people need to know more about their options
For the past three years, the answer to the question, "how do I start investing?" has been easy: open a tax-free savings account (TFSA). But this comes with the caveat that there are broadly four types of TFSA — and most people, misled by banks and insurance companies, open the wrong ones. This is disastrous because the existing regulations do not make it easy to switch accounts. A handy resource to start researching TFSAs is www.savetaxfree.co.za, created by Stuart Theobald, of Intellidex. The financial services research house also conducts an annual survey. It’s hoped the 2017 poll of TFSAs will show people have woken up and are not simply going to their banks to sign up for the completely pointless money market accounts on offer. The 2016 survey showed 59% of the R2.6bn savings TFSAs attracted went to banks. This is sad if you consider that, under existing laws, the first R23,800 interest you earn if you are under 65 is tax free. This rises to R34,500 if you are older. Assuming a...
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.
Subscribe now to unlock this article.
Support BusinessLIVE’s award-winning journalism for R129 per month (digital access only).
There’s never been a more important time to support independent journalism in SA. Our subscription packages now offer an ad-free experience for readers.
Cancel anytime.
Questions? Email helpdesk@businesslive.co.za or call 0860 52 52 00. Got a subscription voucher? Redeem it now.