Give your investments momentum
Do you want your investments to grow? Did you know that you can use your goals to create an investment strategy that keeps you focused and invested for longer?
Just one of the ways you can create a strong investment strategy is to incorporate tax planning as part of your financial plan, which can improve the likelihood of you achieving your goals, especially when planning for retirement.
Tax planning is an important part of creating a financial plan and a successful investment journey.
Boost your retirement savings
Without a doubt, one of the most effective ways to save for retirement is through a retirement annuity.
A great benefit is that you can deduct the money that you invest in a retirement annuity from tax. For example, if you earn about R500 000 a year, your effective tax rate is about 25%. That means that for every R100 you invest in your retirement annuity, only R75 comes from your pocket, because you can get R25 back from the tax man if you claim it back.
To make the most of this deduction, you can invest up to 27,5% of your taxable income or your remuneration, whichever is higher.
Although you don’t get a tax deduction for money you invest in a tax-free investment (also known as a tax-free savings account), you can still enjoy tax-free growth. And you won’t pay any tax on the proceeds when you decide to take money out of the investment.
You can invest up to R36 000 every tax year (R3 000 per month) in a
tax-free investment, limited to R500 000 over your lifetime. Government may adjust these limits from time to time.
What are the benefits of a tax-free investment?
Momentum Global Investment Management offers 3 off-the-shelf solutions offering investors an offshore savings and investments plan that is balanced, yet diversified.
What are the advantages of investing offshore?
Interested in investing offshore?
The South African financial market makes up only 1% of the global market. By only investing locally, you limit yourself by not considering investing in companies with an international footprint that could generate substantial profits across different economies and markets. James Klempster, Investment Director at Momentum Global Investments, talks about the advantages of offshore investing.