saving? investing?

Easter Bunny

Easter Bunny

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my wife had her card cloned this week and they took a lot of money from her (R10000 in one day even though the limit was R5000), so we've decided that we'll rather save the money elsewhere and only keep a bit available in case stuff happens. we've got about R15000 that we want to invest long, and about R5000 to keep for instant access, but still get some interest on it.

we went to nedbank yesterday and were told that we can do a 6month fixed deposit and get about 5.25% on it, and then do a "JustInvest" with the money we might need for an emergency which gives from 4% (R5000 - R9999) to 5.25% (< R1,000,000) interest.

my thoughts were that if we went this route, that we could put R10000 away in a 6 month deposit and let it grow, then put whatever we want in the savings account. after 6 months, we take out most of the savings and add it into the fixed deposit and let it go again for another 6 months.

we haven't been to any other banks yet, so i thought i'd pop on here and get some advice - is there anything you guys could recommend? something we should look out for or questions we need to ask them? also, america has screwed up the economy again, so where would be the safest place to put our money?

thanks for the advice. ;)
 
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For small-ish amounts like that, break them up into a few capitec accounts. As long as they're below 10k, you get 6%. Instant access, no risk.
 
Sanlam Liquid Debit for the R5000 and Sanlam Liquid Fixed Term or Liquid Savings for the larger amount. This is what I would do.
 
we looked at sanlam's website before running out this morning, but it was just a bunch of fancy financial words to me.

the capitec thing sounds good, but do they allow you multiple accounts like that? and service fees? then if you want to close them, don't they charge you?
 
Easter Bunny said:
we looked at sanlam's website before running out this morning, but it was just a bunch of fancy financial words to me.

the capitec thing sounds good, but do they allow you multiple accounts like that? and service fees? then if you want to close them, don't they charge you?
Click to expand...

With Capitec you have your main savings account linked with the debit card, then you can have up to 4 other accounts on your "profile" and you can name them what you want and they all have their own account numbers. If you have under R10 000 in them you earn 6% interest. The monthly fee is R4.50 per account on profile.

http://www.capitecbank.co.za/personal-banking/transact/rates
 
also, we'll be saving an additional R8000 every month (fairly aggressive saving). capitec sounds good though. better than the nedbank options.
 
Inflation rate is currently 5,3% and its likely to creep up soon. So realistically its more a case of preserving existing value than actually gaining value with the options mentioned above. For real gains you'll need to take some risk. If that does not appeal then buy RSA retail bonds...that means you cant get the cash back for 2 years though. There you're looking at 1,5-2% real gains, or 7,5% in nominal terms.
 
UnUnOctium said:
For small-ish amounts like that, break them up into a few capitec accounts. As long as they're below 10k, you get 6%. Instant access, no risk.
Click to expand...

Surely you get more on larger sums of money percentage wise.
 
czc said:
Surely you get more on larger sums of money percentage wise.
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Nop. It decreases.

The whole point is to entice people to switch (the masses with smaller amounts). If they gave away higher percentages on higher amounts, they'd be undercutting themselves seriously.
 
czc said:
Surely you get more on larger sums of money percentage wise.
Click to expand...
Generally yes. Capitec is an exception because their primary motive is, as UnUnOctium said, to profit on the bank a/c transactions not the interest difference between repo & rate offered.
 
I'll admit I don't know much about these things, but I'd look into a Money Market account. Each bank has their own, with minimum deposits, so you may have to shop around. It's safe and gives a good return. In the case of the Standard Bank Stanlib one the only way you can get money out is to physically go into a branch and show ID, fill out forms, and then the money will be paid out within 2-3 days. It's not even listed under your internet banking, so it seems really safe. You can also access it anytime, no fixed term.
 
Easter Bunny said:
also, we'll be saving an additional R8000 every month (fairly aggressive saving). capitec sounds good though. better than the nedbank options.
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8k is quite a bit, you should decide based on your end goal. Looking at buying a house? Some investments help with securing a home loan when you do apply.
 
Capitec not only gives you 6% on up to 4 linked subaccounts on their normal instant-access bank account (Global One), they also do fixed term deposits (as the OP mentioned doing) of various lengths that give you more interest than the normal 6%.

The reason Capitec drops the interest rate to 4,5% on amounts over 10k is because those are transactional accounts. The moment you have more than 10K lying around in an account, they want to encourage you to start using their fixed term deposit accounts that give you even more interest.

Capitec sounds perfect for what you want to do. Open 2 subaccounts - make one a fixed term investment with R10k in it, and put 5k into the normal everyday transactional account. Monthly fee is only R4.50. Also, you get internet banking.
 
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Easter Bunny said:
we haven't been to any other banks yet, so i thought i'd pop on here and get some advice - is there anything you guys could recommend? something we should look out for or questions we need to ask them? also, america has screwed up the economy again, so where would be the safest place to put our money?

thanks for the advice. ;)
Click to expand...

You may also want look at the Money Builder Account From ABSA.

I also agree with UnUnOctium, I have 2 accounts at Capitec, one is for car emergencies and other for any emergency, i must say they work well for me, I like the interest.
 
HavocXphere said:
Inflation rate is currently 5,3% and its likely to creep up soon. So realistically its more a case of preserving existing value than actually gaining value with the options mentioned above. For real gains you'll need to take some risk. If that does not appeal then buy RSA retail bonds...that means you cant get the cash back for 2 years though. There you're looking at 1,5-2% real gains, or 7,5% in nominal terms.
Click to expand...
+1 on this, if you're looking at a medium to long term option RSA retail bonds is a very good option. Just like money market accounts it's a low risk investment but usually with higher growth and the option to link it to inflation. If i remember correctly the minimum to invest is R1000.
Have a look at the link it gives all the info that is needed. https://secure.rsaretailbonds.gov.za/Details.aspx?MenuId=64
 
Sorry if I'm hijacking the thread but how do the money market accounts work?
I saw on the FNB site that there is 1.00% on amounts of R10 000-R19 999.

Does this mean you earn 1% per annum on this amount or how does it work?
 
I honestly don't see the value of investing in something that's only going to give me the same interest as inflation. Obviously its good to save money at the rate (or better) of inflation but what we really need is something to beat inflation. I've been looking for something that's moderately safe and yet good return - quite hard to find that.

All that said, I am definitely thinking of opening a Capitec account - what's nice is that you have instant access to cash should you need it.
 
I use Standard's Online Share Trading Money Market account.

4.22% 0-25000

4.28% 25001-50000

4.39% 50001 - 100000

etc up to

4.93% above 10000000

There is a charge of R50 per month if you do not have 3 trades a month, but the cash is available on 24 hours.
 
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