So, you've been told that you need to invest money to build long-term wealth, but you're not exactly sure how to begin. Maybe one of the things that's holding you back is whether or not you can afford to invest right now. This is a very good question, in fact. And yes, many investment products out there require high deposits in order to see a good return.
The truth is that there are affordable products that are just as good. The important thing to remember when it comes to building long-term financial wellness is that it's your journey and you don't have to invest in the same way as the next person. So if you are looking to start investing affordably, your best option is a Tax Free Investment. As the name implies, you don't pay tax on your returns. This is one of the reasons why it's an affordable option.
Having said that, it's never a good idea to make a decision hastily, without considering all the facts. Like with every other decision in life, making a decision to invest in a tax-free account comes with a few key points to consider. Let's take a look at what they are.
It costs just R50 to start investing and you can make as many contributions as you need to, over the years, as long as your contributions don't exceed R36 000 a year and R500 000 in a lifetime. You can also open tax-free investments across different banks, provided your total contribution doesn't exceed R36 000.
Tax-Free Investments are flexible because you can withdraw whenever you want to. However, remember that the longer you leave the money in the account, the more you benefit from the effects of compound interest.
- You can invest on behalf of your child
Setting up a tax-free investment for your child is a great way to start setting them up for the future and teach them the importance of patience and how to manage money. Plus, you can use the account to accumulate non-taxed savings towards your child's education, or to get them started on the path of financial stability. Just remember to avoid investing up to the maximum — if you do, your child won't be able to contribute to a tax-free account when they grow up.
It's never too early (or late) to plan for the future
Tax-free investment options are perfect for first-time investors, so if you're new to investing, it's perfect for you. All you have to do is take the leap. Remember, you are doing something good for your future. If you're ready invest, click here.