The holiday season is fast approaching, and while most of us are already planning our vacations and finding the perfect gift for everyone on our list, we’re only thinking in the short term. Let’s face it, we could all do with a little extra cash on hand at this time of the year, so why not treat yourself this festive season to something for the future you.
The holiday season is fast approaching, and while most of us are already planning our vacations and finding the perfect gift for everyone on our list, we’re only thinking in the short term. Let’s face it, we could all do with a little extra cash on hand at this time of the year, so why not treat yourself this festive season to something for the future you. Whether you’re a novice or an expert at investing, watching your savings grow is something we can all get on board with.
One of the biggest challenges is knowing where to start, so we’ve asked some of Sygnia’s staff to tell us how they will be saving and investing during the festive season.
Nupe is declaring war on short-term debt
Nupe Mosothoane, Human Resources Generalist
What percentage or portion of your December bonus will you be investing?
I’ll invest at least 30% of it into two specific areas:
1 – refinancing the emergency fund that covers all my emergencies.
2 – opening an investment account for my 4-year old daughter. It’ll most likely be a tax-free savings account and will have the Sygnia FAANG Plus Equity Fund as part of the portfolio.
Why will you be investing / what is your motivation for investing?
It’s important to me to always have an emergency fund on hand, and to build a nest egg for my daughter so that she has a springboard for a successful start to adulthood. Ridding myself of short-term debt and high interest rates will allow me to put that money towards something better.
What products and funds will you invest in and why?
Like many of Sygnia’s staff, I’m interested in the Sygnia FAANG Plus Equity Fund as investing in the companies of the future is an exciting prospect. I’ll also relook the products that I have currently invested in for my two sons.
Steven is saving his bonus and focusing on what matters
Steven Empedocles, Portfolio Manager
What percentage or portion of your December bonus will you be investing?
A lump sum like a bonus can burn a hole in your pocket if you’re not careful. It’s so easy to spend on unnecessary things, especially over the festive season. This year, I’ve decided to invest my entire bonus. Sure, I can spend some of it on things that will give me instant gratification, but I know that the future benefit and the gratification I’ll feel when I see my money grow will be so much greater.
Why will you be investing / what is your motivation for investing?
I want to maximise my utility function and overall wealth and the only way to do this is by giving up the satisfaction of spending today. The long-term benefits of savings far outweigh the satisfaction of spending your bonus on items that will be short-lived.
What products and funds will you invest in and why?
I’m going to invest in a tax-free savings account which provides additional incentives to save in the long term and maximise my after-tax profits. I’ve chosen the Sygnia 4th Industrial Revolution Global Equity Fund because it’s a great way to get exposure to the global stock market, and I’ll be investing in technology companies that are paving the way of the future.
Lauren is maxing out her tax benefits
Lauren Willoughby, Retail Accountant
What percentage or portion of your December bonus will you be investing?
I’m putting away 50% of my bonus and treating myself to two of my guilty pleasures; shoes and a well-deserved holiday.
Why will you be investing / what is your motivation for investing?
Like most people, I’m guilty of not saving enough for my retirement. The tax benefit is an added bonus in the long term. The extra contribution to my retirement annuity will help me sleep a little sounder as I hurtle (only kidding) towards retirement and even the smallest tax benefit helps.
What products and funds will you invest in and why?
I’ll definitely put money into my retirement savings and I usually put some money into my tax-free savings account, too. I’m interested in offshore ETFs and unit trusts, like the Sygnia 4th Industrial Revolution Global Equity Fund and the Sygnia FAANG Plus Equity Fund, though there’ll need to be a bit of a ‘Regulation 28 balancing act’ for my RA with the other funds. I’ll be pushing the limits of foreign and equity exposures as far as possible. I wish I could say I’ve chosen these options because I’ve diligently researched them all and these are the best choices for my long-term investment goals, but honestly, I think it’s because they are the ‘cool new kids on the block’.
Duane is going 100% debt free
Duane Naicker, Head of Sygnia Umbrella Retirement Funds (SURF)
What percentage or portion of your December bonus will you be investing?
I’m currently contributing about 16% of my TCTC towards my retirement savings, which means I have scope to use my December bonus to top-up my contributions and take full advantage of the 27.50% tax deductibility limit. I’ve done the maths and to achieve maximum tax deductibility, I need to use more than half of my pre-tax bonus as a lump sum contribution. That is significant!
Why will you be investing / what is your motivation for investing?
With rigorous budgeting and some serious discipline, I pay as much into my mortgage bond on a monthly basis as I can afford. My aim is to continue contributing at least 16% of my TCTC for at least 40 years in order to retire with an income that will replace about 60% - 75% of my final working salary. I will however be contributing a portion of my pre-tax bonus to take advantage of the tax deductibility limits rather than paying tax – fees matter so my retirement saving are invested as aggressively as permitted by the law and in low cost Sygnia indexing tracking portfolios / Sygnia Itrix ETFs. I also plan to acquire Sygnia Limited shares.
What are your personal investment goals?
I’m not at a point in my life where I’m able to use most of my bonus to invest or save, or even take full advantage of the tax deductibility limits available, but for the last 8 years I’ve used a very large portion of my bonus (if not all of it) to reduce my outstanding mortgage bond and other short-term debt. I hate debt. It can weigh on us emotionally and manifests itself physically, so my goal is to reduce as much debt as I can as fast as I can to relieve myself of it completely. It’s also one of the reasons why my wife and I share a car. My focus on discretionary investing will become a higher priority in the near future to relieve myself of it completely. It’s also one of the reasons why my wife and I share a car.
Chante is putting herself first – finally
Chante Burger, Junior Quants Analyst
What percentage or portion of your December bonus will you be investing?
I plan to invest 50%of my bonus.
Why will you be investing / what is your motivation for investing?
I’ve always understood the importance of investing, but I’ve always delayed making my own investments. I recently bought my first Sygnia Limited shares and I’m very excited to continue planning for my future and saving to reach my financial goals.
What products and funds will you invest in and why?
I’m going to invest in offshore products, including the Sygnia 4th Industrial Revolution Equity Fund (one of a kind, a must have for any portfolio in my opinion) and the Sygnia Itrix MSCI World ETF. Products like these are essential to gain exposure to companies poised for growth in the 4IR space, and to diversify local holdings with offshore markets. ETFs are also a great way to gain broad market exposure through a single vehicle.
I will also invest locally in the Skeleton Balanced unit trusts. This is a range of multi-asset funds with different risk objectives (and thus variable recommended investment horizons), with all asset allocations decisions made by Sygnia, will remove the need for me to adjust weightings to different asset classes as market conditions change. These funds also charge some of the lowest fees available, so they’re great value for money!
Siyabulela is starting an education fund for his 2-year old
Siyabulela Nomoyi, Portfolio Manager
What percentage or portion of your December bonus will you be investing?
I always devote around 25% to my savings for any income that falls outside my normal monthly salary. Since December is a “spending” month, I’m going to commit to that proportion as soon as the money hits my bank account.
Why will you be investing / what is your motivation for investing?
My biggest motivation right now is financial freedom for myself when the time comes to send my two-year-old to the “big school”, as we call it, as well as his future education. I’m pushing inflows to my personal savings and mostly to the tax-free savings account I’ve set up for him. I am preparing for his future before he can even say his name properly, but I don’t want to be desperately looking for funds when the time comes for him to go to school.
What products and funds will you invest in and why?
I am really excited about Fintech at the moment. I’m still young age, and my son’s TFSA has a long way to go, so offshore exposure that will also give exposure to new and exciting tech companies is my current high at the moment. It’s what has led me to invest in Sygnia’s 4th Industrial Revolution Fund on a personal level as well as to gain some exposure in my RA. The little guy’s exposure is now on the Sygnia FAANG Plus fund. In terms of risk and potential capital growth I think both funds speak to me, since I am investing over the very long term.
For more information on our savings options please visit our Invest section.