FINANCE FEATURE
S S E C C U S S G N I V A S LONG-TERM vestments oking at long-term in lo so al e ar ls ve ok st Traditional e to you e the options availabl these days. We explor
In order to determine which investment option is best suited to your stokvel, you need to answer a few questions, first: • Who will be a part of the stokvel? It is best to have members in the group who have the same goal in mind as different goals could lead to friction. • How much money will each individual be able to invest? • How long does the group want to
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invest the money for? Keeping your money invested for a longer term means a better return overall. • What is the purpose of investing the money? • How much risk is the group willing to take on an investment? Long-term investments will give your money the chance to grow and provide you with better returns if invested in the right product. Generally speaking, when it comes to a long-term investment, taking a slightly higher yet well-managed risk option will eventually see the best growth and long-term gains. Investing in a low-risk product means your money will grow steadily but also very slowly, which could be detrimental to your savings goals.
Broker a deal Consider approaching a broker who can educate you on which products will best suit your needs. He will be able to assist you with drawing up rules for how the investment will be run, which can prevent any impulsive decisions being made which could harm the investment. The rules will stipulate how the money is collected and invested as well as govern how it can be withdrawn, how dividends will be paid out and whether interest will be reinvested. A broker can also act as a neutral intermediary if a dispute between members arises. You should be able to find a financial adviser at your bank – Standard Bank, First National Bank, Nedbank, Absa and Sanlam all have registered financial advisers who can provide you with
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hen you have a short-term financial goal like a relative’s funeral, this year’s school fees, a birthday party or a holiday, turning to your stokvel makes sense. However, what if you want to gear yourself for a bigger financial commitment – like a new car, your child’s university education or your own house? The stokvel is changing its identity.
