MyMoney Online, Make Money Mondays

Success! First-time savers open 1/3 of all Tax-Free Savings Accounts

South Africans do not save enough.

There are many reasons for this; one of them being the disincentive of paying tax on investment returns.

For this reason, Treasury introduced tax free savings accounts on 1 March 2015.

All proceeds (dividends, capital gains or interest) of investments in these accounts are tax-free.

After four months 35 384 South Africans opened an account.

A third of these accounts were opened by first-time savers, which is exactly what Treasury had in mind with this innovation.

Most of the money – about two thirds - is going into shares.

This is encouraging, because it's the best way to get the most benefit from these accounts.

The Money Show’s Bruce Whitfield interviewed Stuart Theobald, Chairman of Intellidex, about the success of these wealth-boosting investment accounts.

Scroll down for quotes from the audio below.

After four months just over 35 384 accounts have been opened. This is pretty good!

Stuart Theobald, Chairman of Intellidex

Half of tax-free savings accounts came in a “life policy” wrapper.

Stuart Theobald, Chairman of Intellidex

About 6000 accounts are unit trusts.

Stuart Theobald, Chairman of Intellidex

About a third of the accounts have been opened by first-time savers. This was exactly what Treasury had in mind. This is a really good result.

Stuart Theobald, Chairman of Intellidex

We excluded the big banks from our research as they weren’t willing to share information.

Stuart Theobald, Chairman of Intellidex

Most of the money is going into shares – about two thirds. This is encouraging, because this is how to get the most benefit from these accounts.

Stuart Theobald, Chairman of Intellidex

Investing R30 000 a year can turn into millions in the long-term.

Stuart Theobald, Chairman of Intellidex

For more information on tax-free saving go to www.savetaxfree.co.za.

Stuart Theobald, Chairman of Intellidex

Subscribe to our Business Wrap Newsletter

CapeTalk welcomes all comments that are constructive, contribute to discussions in a meaningful manner and take stories forward.

However, we will NOT condone the following:

  • Racism (including offensive comments based on ethnicity and nationality)
  • Sexism
  • Homophobia
  • Religious intolerance
  • Cyber bullying
  • Hate speech
  • Derogatory language
  • Comments inciting violence.

We ask that your comments remain relevant to the articles they appear on and do not include general banter or conversation as this dilutes the effectiveness of the comments section.

We strive to make the CapeTalk community a safe and welcoming space for all.

CapeTalk reserves the right to: 1) remove any comments that do not follow the above guidelines; and, 2) ban users who repeatedly infringe the rules.

Should you find any comments upsetting or offensive you can also flag them and we will assess it against our guidelines.

CapeTalk is constantly reviewing its comments policy in order to create an environment conducive to constructive conversations.

Read More
How to extract maximum value from the new Tax Free Savings Accounts

How to extract maximum value from the new Tax Free Savings Accounts

No Capital Gains Tax, no Dividends Tax, no Income Tax from interest earned… How to get the most from a Tax Free Savings Account.

The best Tax Free Savings Accounts in South Africa

The best Tax Free Savings Accounts in South Africa

Galileo Capital Financial Advisor Warren Ingram researches Tax Free Savings Accounts and discusses his favourite ones.

Tax free savings accounts 101 (and why they’re NOT what they’re made out to be)

Tax free savings accounts 101 (and why they’re NOT what they’re made out to be)

Minister Nene formally introduced tax-free savings earlier this year. Financial Planner Gregg Sneddon's wide-ranging discussion...

How to maximise the benefits offered by Tax Free Savings Accounts

How to maximise the benefits offered by Tax Free Savings Accounts

Tax Free Savings Accounts can be powerful wealth creators, if you use them right. Here's how...

Savers rejoice! South Africa gets tax-free savings accounts on 1 March 2015

Savers rejoice! South Africa gets tax-free savings accounts on 1 March 2015

Savers rejoice! On 1 March 2015 government introduces tax free savings accounts. Financial planner Claude Hannah explains…

10 reasons why this is BY FAR the best way to save for retirement

10 reasons why this is BY FAR the best way to save for retirement

Is there a single best way to build your wealth so you can retire with dignity? Yes, there is, despite costs and limitations.

Popular articles
KPMG International's meeting with Pravin Gordhan

KPMG International's meeting with Pravin Gordhan

The Money Show’s Bruce Whitfield interviews Pauli van Wyk, a journalist with Scorpio at Daily Maverick.

'KPMG must fall, it's as simple as that' - caller

'KPMG must fall, it's as simple as that' - caller

In the wake of recent allegations, Eusebius McKaiser asks listeners what should happen to KPMG in South Africa.

KPMG SA’s new CEO opens up about the future of the disgraced auditing firm

KPMG SA’s new CEO opens up about the future of the disgraced auditing firm

The Money Show’s Bruce Whitfield interviews KPMG South Africa CEO Nhlamu Dlomu.

Ocean View activist speaks: We have had 20 murders in 2017 alone

Ocean View activist speaks: We have had 20 murders in 2017 alone

Sharone Daniels, a community activist in Cape Town's Ocean View says they need police intervention to end gang violence.

Civil engineer devises plan to use stormwater in Cape Town

Civil engineer devises plan to use stormwater in Cape Town

Civil engineer and Ph.D. researcher John Okedi speaks to CapeTalk host John Maytham about his plans.

[WATCH] Day-Zero for water running out fast approaching?

[WATCH] Day-Zero for water running out fast approaching?

A government employee emailed John Maytham about what he or she believes is the real state of play with the Cape water crisis.

Sasfin CEO opens up about dumping KPMG

Sasfin CEO opens up about dumping KPMG

The Money Show’s Bruce Whitfield interviews Sasfin CEO Roland Sassoon.