As we are approaching the end of another year full of market confusion and volatility, with all of Trumps comments, the Steinhoff saga, the Rand reaching its weakest in more than two years and a vast array of other factors affecting the market, investing these days may seem like a daunting task. Our advice for 2019 is to go offshore and tax-free.
Investing offshore might seem like a complicated process, with some questions even being raised such as, “the Rand is to weak, should I wait?” When the truth is, as many would say, you cannot time the market. Then the next question may be, when should I begin my investment? Well, like the popular Chinese proverb, “the best time to plant a tree was 20 years ago, the second-best time is now.”
Then how do we begin to invest offshore? There are many different global fund offerings available to you to move your funds offshore, using a wealth manager can simplify this process for you and give you the best options and recommendations to get the returns you are looking for. Allan Gray has reduced their minimum offshore investment amount from $10 000 to a much more accessible $1 500, making it easier for the new investor as well as the wearier investor to join the offshore market. It may seem like quite a substantial amount of money looking at our current exchange rate, but if we look at the value fluctuations of the rand in the past, it has just been getting worse over time with no sign of recovery in the future. Offshore markets have been performing exponentially better than South African markets and the best option will always be to have a large portion of your investments with offshore exposure.
The next investment you should have is a tax-free investment, allowing you to invest and receive returns completely tax-free. This investment allows for a maximum amount of R33 000 a year, with a total contribution amount totalling R500 000, all completely tax-free. Having this amount can allow for great returns especially for the long-term investor. We suggest adding this to your investments as soon as possible, and really maximising the amount you can invest tax-free. No one wants to pay tax, and most of us would take any opportunity we could to avoid paying said tax. This vehicle proves to be the perfect instrument to grow wealth completely tax free. Just like the saying by Benjamin Franklin, “Nothing in this world is certain, except death and taxes.” Make sure you have a tax-free investment within your portfolio.
Resolute Wealth highly recommends that you include these investments into your portfolio as soon as possible, and allow us to assist you in implementing these investments within your portfolio.