Financial Advice

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Aider

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Hello,

I'm 18 years old and I'm looking for advice on what to do with my money. I have around 24k saved up in my 'savings' bank account where I earn 0 interest, but there are no bank costs. I have no debts and I'm not planning on buying anything soon. What sort of account and from which bank can I get the most interest? I'm also interested in learning how to trade stocks but I've got no idea where to begin.

Thanks!
 
Capitec.


Cheapest banking. Best interest on daily savings accounts.


w.r.t. stocks....... check out standard bank,website suggests there is a free programme available for prospective clients that wish to invest in shares....
 
SinghDude said:
Capitec.


Cheapest banking. Best interest on daily savings accounts.


w.r.t. stocks....... check out standard bank,website suggests there is a free programme available for prospective clients that wish to invest in shares....
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What he said!

Well done on saving up R24 k, at your age that is fantastic ;). Standard bank Online Share Trading is good. If you are an online share trading client you get to attend their free courses. Trading stocks is very risky. Never use your emotions to trade, either use technical analysis or fundamentals because 90% of people that trade lose most, if not all, their money in their trading account.

Continue saving money, especially for a rainy day (emergency fund). Don't buy expensive cars, buy cheap cars. Be stingy and be a cheap skate :).
 
I would look at putting those savings into a collective investment (unit trust). The choice of fund would depend on your needs. There would be costs involved but they would be negated by the returns you can achieve.

This is just a brief opinion. You should seek more detailed advice before making any decision.
 
Aider said:
Hello,

I'm 18 years old and I'm looking for advice on what to do with my money. I have around 24k saved up in my 'savings' bank account where I earn 0 interest, but there are no bank costs. I have no debts and I'm not planning on buying anything soon. What sort of account and from which bank can I get the most interest? I'm also interested in learning how to trade stocks but I've got no idea where to begin.


Saving up that money at your age... You should teach us money savings skills, judging the money that you have saved and your age. I think you should continue saving the way you have been doing until you understand exactly what you to do with it.
Click to expand...
 
Saving up that money at your age... You should teach us money savings skills, judging the money that you have saved and your age. I think you should continue saving the way you have been doing until you understand exactly what you to do with it.
Click to expand...

Indeed, he has definitely got the saving aspect sorted but not so much the investment aspect. He is currently losing over 6% value per annum by having it in a 0% account.
 
I'm guessing the OP is with ABSA. They the only ones I know that offer savings accounts that give 0% interest!
 
@OP good job on saving the cash, not many 18yo can say that, actually not many people can say have saved that much.


However w.r.t losing 6% per annum, I love it when people say that. Do you really think inflation is only 6% pa? I personally believe it is around 11%. Just look at how much electricity & petrol go up, way more than 6% pa.
 
Toitjie said:
@OP good job on saving the cash, not many 18yo can say that, actually not many people can say have saved that much.


However w.r.t losing 6% per annum, I love it when people say that. Do you really think inflation is only 6% pa? I personally believe it is around 11%. Just look at how much electricity & petrol go up, way more than 6% pa.
Click to expand...

Unfortunatly you can't go on estimates and guesses so it's easiest to use official inflation!
 
You might find http://www.satrix.co.za interesting. Especially the Satrix 40 is attractive if you are looking for a less risky investment and the returns are good. They also offer a low admin fee and a savings plan eg. R500 per month to add to it. Dividends are reinvested into the fund.
 
@Singh: I'm not planning on spending any of it in the near future. I just want to make it grow.
@Sly: Both my dad and I plan on learning and understanding technical analysis; we're just struggling to find the time and where to start.
@Acid: I'm with Standard Bank. My parents opened this account for me long ago under the impression that it was a 'savings' account. Only yesterday when we went to the bank were we informed that the account gains 0% interest.
@Clint and sajuli: I'll have to do some research haha.

Thanks for the advice!
 
Capitec closes your account if there is no activity after a few months. I would suggest something else if you are only going to use that lump sum, with no monthly payments.
 
Aider. You are only 18 years old and already thinking of trading. That's great but remember that to make money with trading will take years of experience and chances are good that you will loose all your money if you start now.

There are many trading methods and systems. Do you intend trading on a regulated platform like the JSE's SAFEX with SSF's or non regulated such as Global Trader with CFD's or Forex with the numerous FX Brokers around the world?

Do you want to trade Indexes like the ALSI or TOPI or just stocks or $/ZAR? I gets vast and I only mentioned a few.

I have said that I will not give advice here but I feel in this case that I must. (Big probs coming)

Start with investing on the JSE via Standard Bank or my preferred brokerage Co. ImaraSPReid.co. Transfer your cash to the JSE via them. You will earn around 4 to 5% pa interest on your cash. Now start with investing in SatrixIndi at dips. Get to learn when to buy. This might take months but you are earning a reasonable interest while you wait for the dip. Plus, you will be learning.
You might add 25% into SATRIXDIVI but the Indi will give you a conservative 30 to 40% pa.

Now read and read on trading while your STX is working for you.
ShareChat is a good forum to interact with traders and investors. Join it and read what the guys are doing. Get graphs, indicators etc. You can follow the gurus trades and learn from them.

Only then after years of reading should you sell your STX and go bigger.
If only I had done this years ago, I would be retired now. Eish.
 
marco said:
but the Indi will give you a conservative 30 to 40% pa.
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Do you have unencumbered property with sufficient value to cover say a bar? Tell you what, you give me capital + 20% return guaranteed via first covering bond over property and I'll invest with you. Nice upside for you to make.
 
http://www.sharenet.co.za/v3/share_performance.php?scode=STXIND
Just to add to SATRIXIND.

Now these are conservative SATRIX ETF's I would recommend these to new investors rather than property and bonds.

Once you have enough knowledge, you can buy into stocks that perform much better.
http://www.sharenet.co.za/v3/share_performance.php?scode=ELI

Yes, that 270% this year is great but it will continue as the new desk top hardware is due in June this year.
So Aider. Before you start trading and loose all your money, go for STXIND while you learning.
 
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Just a headsup - marco is infamous for spewing forth nonsense. Take everything he says with a couple of pinches of salt.
 
Speedster said:
Just a headsup - marco is infamous for spewing forth nonsense. Take everything he says with a couple of pinches of salt.
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At times yes..

But his advice here is actually very good!
Putting your money on the stock exchange is never a safe bet. You never know what financial crisis is around the corner. But by investing ETF you are effectively investing in a market tracker for that segment. It diversifies you over various companies and definitely reduces your risk.

The majority are on the up now, and I'm not a fan of putting all your cash into the market at once. Sometimes it can work out, but I don't think that's ever very smart.

I've been putting cash monthly into EFT's split between (STX 40, INDI, DIVI, Proptrax and FINI) since last year June and they've done quite well. All re-invested of course! and doing average across the board of 23%.

Don't try time the market that hardly ever works out!
I would recommend you start by reading a couple investment books and even the sharnet forum as suggested.

EDIT: Just a note I'm not a professional trader or anything. Just sharing my experience.
 
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