Help me understand this (saving account)

[Swa]

The rand see saws agains the dollar

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So you have to buy the dollar in the dips to gain, if you bought it went it was highest and the rand gains strength you would loose out. Do consider there are big risks for the dollar ie BRICS talks of dollar replacement as using the dollar for trade, and the fact that the dollar debt is about $52 trillion (thats how much IOUs the federal reserve wrote when they sold dollars to foreign countries for trade. Not to be confused with US government debt as $32 trillion.

If youre looking to Asia and you have actual dollars, they are strict with the condition of the notes (no damage, latest series etc). Or you can get less for your dollars.

So yes this is all part of the risk, if the rand tanks more and you have dollars you can score, but if the rand strengthens, you could loose.

So investment funds buy bits and pieces of everything and watch it like hawks. So its always good to chat to a financial advisor.

Do note you can only put about R1 million offshore as part of your foreign allowance per year.

If you invest in a local fund I would go for Coronation or Allan Gray.

I tend to like this fund. But it has more risk then other funds where your capital is 100% guaranteed. With Covid you would have noticed negative bonuses with some pensions where your pension actually loose value. When youre close to retirement you tend to put it in a fund that doesnt have that. ie Old Mutual Coregrowth where normally your funds are 100% guaranteed, so it wont have a negative bonus. But the downside is, due to less risk, means you will most likely not have such an aggressive fund, thus giving you lower rates of return).

Welcome Page

www.coronation.com

A lot of people tend to buy govt bonds that pay out a set amount. However you would need to decide your long term goals, do you want to move abroad? Property locally is good but has risks, depending on where you buy, but can give good growth. Etc.

Every decision you make carries a risk, so best to chat to a good financial advisor.

With shares you will have to watch how it performs and if it pays a dividend or not. You can use the dividends into buying more shares. But if the company crashes so does your investment.

Ironically buying actual gold sometimes seems the safest but other than growth you wont get monthly return as with some investments.

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Overall it has shown a devaluation and will continue while we have an inflation target of 3-6%. Over a lifetime the instability doesn't really matter but you should start while young. If you're near retirement it's best not to touch anything that's highly volatile.

 

[justplain]

I have a question that I'm struggling to find a clear answer to.
I have 6 EFT's in the TFSA. Does selling for example one of the EFT's and buying another count towards my annual R36k threshold?
Basically trying to establish if buying/selling within your TFSA counts towards your limit regardless of the R36k annual contribution limit.

 

[SauRoNZA]

I have a question that I'm struggling to find a clear answer to.
I have 6 EFT's in the TFSA. Does selling for example one of the EFT's and buying another count towards my annual R36k threshold?
Basically trying to establish if buying/selling within your TFSA counts towards your limit regardless of the R36k annual contribution limit.

Nope as long as it's all "encapsulated" inside your TFSA you can do what you want.

It's only when you pull it out of your TFSA that it matters and you can't put it back in then.

The contribution limit is "into your TFSA" not relevant to what happens inside of it.

 

[Swa]

I have a question that I'm struggling to find a clear answer to.
I have 6 EFT's in the TFSA. Does selling for example one of the EFT's and buying another count towards my annual R36k threshold?
Basically trying to establish if buying/selling within your TFSA counts towards your limit regardless of the R36k annual contribution limit.

What he said, and I assume you mean ETFs. Also look at whether dividends are paid into your TFA and where costs are deducted. Dividends should automatically go into your TFA for further growth but some don't get this right and pay them out. Being able to pay for costs and transaction fees outside your TFA is also a plus giving it more mileage.

 

[justplain]

What he said, and I assume you mean ETFs. Also look at whether dividends are paid into your TFA and where costs are deducted. Dividends should automatically go into your TFA for further growth but some don't get this right and pay them out. Being able to pay for costs and transaction fees outside your TFA is also a plus giving it more mileage.

Ja, I'm too used to typing EFT .......so that's a typo... E T F!!!
and yes, dividends pay out into the TFSA account and I use them to buy more of the funds I'm invested in.