WHY IS it we always think we should give presents to those we love instead of a solid financial start?
Instead of gifts to show your love, how about introducing them to a share portfolio, or opening a tax free savings account for them.
“Open a tax-free savings account and contribute R300 a month for the next 12 months. By then you would have contributed R3 600,” said Ester Ochse, channel head for FNB Financial Advisory.
She said while there’s nothing wrong with spoiling a loved one as a sign of appreciation, buying them an investment product could improve their financial future for the better.
According to economic data site tradingeconomics.com, Mzansi’s household savings rate (the amount people save from their income) had dropped dramatically by September last year and remains unchanged this year at -0.80 %.
When you buy shares you contribute to changing their saving attitude and the national savings rate in the long run.
Investments are seldom thought of as gifts, but they can be a way of showing appreciation for someone without spending large amounts of money.
“It’s even better if the receiver of the gift does not have an investment.
“The advantage of this is that they will finally have an investment of their own and possibly develop good savings habits,” Ochse said.
