Ask most South Africans why they haven’t started investing yet, and you’ll probably hear the same answers: “I’m too young to worry about that, I’ve got time later.” “It’s too late for me now.” “I don’t have enough to invest to make it worthwhile.”
These are all understandable feelings – but they’re not facts. The most important thing about investing isn’t how much you start with, how old you are, or how perfectly you time it,” explains Sisandile Nkatu, Head of Retail Investments, Nedbank. “It’s simply that you start. If you wait until you are ready, or you feel you have enough, you’re going to wait forever.”
She offers some useful guidelines for getting your investment journey underway at any point in your life:
Just starting out (20s to early 30s)
Time is your ally when it comes to saving and investing. “A simple savings account with a small monthly debit order for a young a child or teenager builds the saving and investment habit before it builds the balance,” Nkatu says. “From there, a tax-free savings solution – whether it’s a tax-free savings account, tax free fixed deposit, or tax-free unit trust – is arguably the single best long-term investment a young South African can open.” Every rand of growth inside a TFSA is completely tax-free, and it compound year after year.
