Investo FAQs
Investo Retirement Annuity
FAQs
When will I choose a retirement annuity (RA)?
expand_moreIt's for you if you want to invest regularly towards your retirement (say monthly or yearly) and grow your money while benefiting from tax incentives. You can also add once-off amounts. You can save extra in an RA if you have a pension fund at work. If you don't contribute to a pension fund, it's a great way of making provision for your retirement in a tax-efficient way. South African citizens or persons with valid work permits may invest.
Can I withdraw money from my retirement annuity (RA) before I retire?
expand_moreCurrently, you have access to the money from age 55. Before that, you can take out money only if you emigrate or became disabled. If your savings are lower than a certain amount, you may take it too.
From 1 September2024, you have access to one-third of your contributions every tax year, from 1 March until the end of February. You may withdraw once a year, an amount of at least R2 000.
Can I stop paying my retirement annuity (RA) contributions?
expand_moreYou can stop paying, but the money stays invested until you turn 55.
From 1 September 2024, you have access to the money in your so-called savings component of the retirement annuity. You may withdraw it all. The rest will stay invested until you turn 55.
What are the tax benefits of saving in a retirement annuity (RA)?
expand_moreThey are great. For example: If you contribute R1 000 a year, you will get R360 back from the tax man if your marginal tax rate is 36%. It “costs” you only R640 to invest R1 000.
You can invest up to 27,5% of your taxable income or remuneration, whichever is higher. You can do this whether you are self-employed or earning a salary but not yet contributing the full amount to your employer’s pension fund. The maximum tax deduction you can claim in a tax year is R350 000, a limit that applies only when you are earning more than R1,27 million a year.
Is there a minimum amount I need to invest each month?
expand_more2. R750 minimum when you invest in one or more non-Momentum funds.
3. R150 if you already have another Investo contract.
What happens to my retirement annuity (RA) when I die?
expand_moreYour dependants or the loved ones you have indicated receive the money as prescribed by law.
Investo Linked Investment
FAQs
When will I choose a linked investment?
expand_moreYou want to grow your money over the medium to long term by contributing regularly. You want flexibility and wish to add once-off amounts as you please. You will choose a linked investment if your marginal tax rate is less than 30% because you pay tax on the growth you earn every year. South African citizens, trusts, companies, close corporations and non-profit organisations may invest.
How do linked investments work?
expand_moreThe linked investment is a flexible savings plan, which means you can adapt your investment as your needs change. The solution is designed for long-term growth, but you may take your money if necessary. You can contribute at regular intervals and add once-off amounts. You pay tax on your growth and will use your interest and capital gains tax exemptions to minimise the tax payable.
Do I have a choice of investment options?
expand_moreYes. We offer local and global funds. You can choose among fund managers and the types of assets you want to invest in. For instance, do you prefer shares, bonds, property, or a mix? Choose from the Investo fund range and the Momentum Investments outcome-based solutions range to let your money grow.
For how long do I need to be invested?
expand_moreYou can take your money anytime, but you must stay invested for at least 5 years to earn a loyalty bonus.
Can I withdraw money from my investment if I want to?
expand_moreYes, but you need to keep at least 20% invested. For the best long-term growth, it's better to stay invested.
Do I need to put down a lump sum amount?
expand_moreNo, but you can if you want to. You can invest monthly, which will be a minimum of R500 per month in Momentum funds and R750 in non-Momentum funds. You can also invest once-off amounts of at least R5 000 at any time.
Investo Endowment FAQs
When will I choose an endowment?
expand_moreChoose an endowment if you want to save for a goal. People in a higher tax bracket often prefer this product. Individual investors, trusts, companies, close corporations and non-profit organisations may invest.
How do endowments work?
expand_moreIt is designed for long-term growth. There are restrictions to how much money you can add to or withdraw from your investment. If you exceed those, you trigger a new period of 5 years, during which some transactions on your investment are limited.
What are the tax benefits of having an endowment?
expand_moreWe pay the tax on the product, which means you will not be taxed separately on the growth of your investment. It is a great advantage if your personal income tax rate is higher than 30%.
If I pass away, what happens to the money in my endowment?
expand_moreThe loved ones you have nominated as your beneficiaries will receive your money.
Can I withdraw money from my endowment if I want to?
expand_moreYou may withdraw once during the first 5 years of your investment and take out one loan. There are restrictions to how much money you may withdraw however after the first 5 years, you have full access to your money unless you trigger a new restriction period.
Do I need to put down a lump sum amount?
expand_moreNo. You can invest a R500 monthly minimum in a Momentum fund or a R750 monthly minimum in non-Momentum funds. You can also invest R150 per month if you have another Investo contract. If you want to add a once-off amount, it must be at least R5 000.
Investo Preservation Fund FAQs
What is a preservation fund?
expand_moreA preservation fund is a retirement fund to keep your retirement money safe if you have resigned from an employer. You may access your money when you turn 55.
What happens at retirement if I am in a pension preservation fund?
expand_moreIf you retire, you must buy a product, called an annuity, that will pay you a pension income. You may take part of the money as a lump sum, which you may be taxed on. Your lump sum may not exceed one-third of your retirement value.
What happens at retirement if I am in a provident preservation fund?
expand_moreIf you retire, you can buy a product, called an annuity, that will pay you a pension income. You may also take all your money, or a portion of it, as a lump sum, which you may be taxed on.
How does two-pot affect my preservation fund?
expand_moreIt works like for a retirement annuity. You will have access to the seeding capital that is transferred to the savings component on 1 September 2024. At age 55, you get access to all your money.