Last night, we went to the Johannesburg leg of the Take 5 series by Nedgroup investments. A free hour long talk on tax efficient investing with the successful financial consumer journalist, author and public speaker; Maya Fisher-French. One of our FAVS!
Usually most people’s minds go straight to flight mode when the word “TAX” is mentioned. The thought of SARS taking chunks of our molla, whilst trying to understand the numbers, can be depressing. However, Maya’s mix of humour, relatability and knowledge helped many to take the plunge of understanding tax and its effect on our money.
Maya begun by delving into the various investment taxes. Mainly, tax on interest, capital gains tax and dividend tax. She pointed out that the max capital gains tax of 18% wasn’t applicable to all. You would need to multiply 40% of your capital gain by your marginal tax rate to determine your capital gains tax. Lessons on lessons!
She continued dropping gems by highlighting tax in relation to retirement funds, Tax-free savings accounts (TFSA) and Endowments. It’s crucial to know and understand the tax implications for each to maximise your net benefit. Whether there is tax on growth, interest, or tax payable upon withdrawal. It became quite clear why Maya is such a super Fan of TFSA’s. The benefits of a TFSA can be the foundation of your wealth creation journey. There is no tax on this investment! No tax on growth and no tax payable on withdrawal. However, there are a few limitations like only being able to save up to R33 000 a year (R2750 per month) and a lifetime limit of R500 000. Even with these limitations, the fact that SARS isn’t taking a dime is something to smile about. Especially when you see what compound interest can do to that money.
Maya then took us through a time-travel journey of estimating how much R33 000 at 10% per annum would be in 15 years. A cool R1 149 292 (Still need to take inflation into consideration). You would have saved R495 000 in total whilst a whooping R654 292 would be as a result of compound interest! Gems.
She then wrapped up her presentation with explaining why fees matter and how a debt order on your investments can lower your risk over time.
This was an impactful talk centred around tax benefits, pitfalls and the important things to consider like fees. If you missed the event, you will be glad to know that more events will be rolled out. In the meantime, follow Maya on social media and visit her website to get more information around taxes and their effects on your money.
We truly look forward to the next Take 5 series.
Shhhhh, did we also mention that Maya is working on a new book that should hit our shelves in early 2020. Yaaaaay!