Two easy ways to start investing with only R500 a month
If you think that you're too broke to start investing your money, then you've been misinformed. It is possible to start growing your wealth with as little as R500 ever single month.
Despite what most people think, you don't have to have millions in the bank to invest your money. There are exciting new platforms that you can use to invest with as little as R100.
Of course, R100 gives you very little exposure to the investment world, that's why I want to show you the options available to you to grow your investment savings, increasing your exposure to the markets and make greater returns in the medium to long-term.
Two ways to start building your wealth starting with R500 a month
1. Start with a fixed deposit account
Fixed deposit accounts were initially used for lump-sum savings. But Capitec and FNB give you the opportunity to start with a minimum amount.
FNB’s Flexi Fixed deposit accepts deposits of R100. You can increase the amount you deposit at anytime but you are only allowed to draw 15% of your savings, twice a year. You’ll also earn interest between 2.25% to 4.25% depending on the amount in your account and what the countries interest rates are.
Capitc on the other hand offers a fixed-term savings plan where you make multiple deposits. It’s Global One facility allows you to deposit money when you like but you’re only allowed to draw money before your savings term is up. You can decide on this term from a minimum of six to 24 months. The interest rates are fixed at 6.4% which means you’d lose out slightly if the interest rates increase.
2. Retail Bonds are perfect for individual investors
There are two types of retail bonds available to you as an individual investor. RSA Retail Bonds offer decent returns but you’ll need a minimum of R1,000 to buy them on a term of two, three or five years.
Bonds are not ideal for month-t-month savings accounts. But if you structure your savings accounts correctly, like using the higher-interest savings accounts that Capitec offers, you can afford to buy the retail bonds after saving for a full year. You can do this every year and start reaping better returns from your savings every year.
You see, it’s not impossible to increase the amount of money you have by investing it. If you’d like to find out how to grow your wealth even quicker starting with just R500 a month, then don’t miss the next issue of Joshua Benton’s Real Wealth.