This presentation discusses personal development through savings and investments. It defines savings as money left over after expenses and explains that savings can be invested to generate additional income. Investments commit money to endeavors like businesses with the goal of making a profit. The presentation outlines various methods for saving and investing, including tax-free savings accounts, exchange-traded funds (ETFs), and unit trusts. ETFs track market assets and are traded like shares, while unit trusts pool investor money into professionally managed funds covering property, cash, equities, and bonds. Overall, the presentation provides an overview of investment vehicles and their benefits for building wealth through committed savings.

1. PERSONAL DEVELOPMENT
SAVINGS AND INVESTMENTS
PRESENTATION BY PHILILE KAMANGA

2. WHAT DOES IT MEAN TO SAVE?
• SAVINGS
“For those who are financially prudent, savings means the
amount that is left over after personal expenses have been
met.”
INCOME-EXPENSES=SAVINGS
Savings can be turned into further increased income
through investing

3. • INVESTMENTS
“The act of committing money or capital to an endeavour (a
business, project, real estate, etc) with the expectation of
obtaining an additional income or profit”
 Different way of earning an income
 key to building wealth
 Investing means making your money to work for you

4. METHODS OF SAVING AND INVESTING
 TAX FREE SAVINGS ACCOUNTS
• As of 1 March 2015 South Africans can invest in tax free investments
• An initiative of National Treasury to encourage people to save.
• The returns or growth you earn on your investments are completely tax free.
• Tax free investments give you flexibility
• You can invest up to R30 000 in one tax year and R500 000 in total over your lifetime.
• You have flexible access to your investment and there are no exit penalties
• Tax free investments only apply to new investments

5.  EXCHANGE TRADED FUNDS (ETF’S)
• Marketable security that tracks a commodity, bonds, oil
futures, gold bars or a basket of assets like an index fund and
divides those assets into shares.
• Experience price changes throughout the day as they are
bought and sold in the same way as an Ordinary share.
• Traded on public stock exchanges.
• Share-holders do not directly own or have any direct claim to
the underlying investment in the fund.

6. • Share-holders are entitled to a proportion of the profits, such as
earned interest or dividends paid.
• Investors get the diversification of an index fund

7. Who is this for?
• Used by both professional and private investors
wishing to gain exposure to different sectors, asset
classes, types of shares, commodities or government
bonds
• Ideal investment vehicle for those who are new to
the world of investing

8. • Provides exposure to a variety of underlying instruments and not
just one instrument (i.e. it offers diversification)
• Can be bought and sold quickly at a low cost
• You gain exposure to a wide variety of securities or assets without
having to do extensive research
• Are well regulated by the JSE and the FSB
• Exempt from securities transfer tax
• ETF’s prices fluctuate, however because of the advantage of
diversification, the risk of losing money is lowered.
Features

9. • Most common collective investment scheme in South Africa
• The fundamental premise behind a CIS is to allow a group of
investors to pool their money in order to get a spread of
professionally managed investments
• Investors share the risks and benefits of investment in a
scheme in proportion to participatory interest in the scheme
• Originally designed to give ordinary people access to the JSE.
UNIT TRUSTS

11. KEY BENEFITS

12. FOUR ASSET CLASSESS
1. PROPERTY
2. CASH
3. EQUITIES (SHARES)
4. BONDS

13. • unit trusts offer a blend of investments/asset classes managed by
investment professionals
• ETFs offer a single entry into each investment, which are index-based and
computer programme driven.
• ETFs can be a good choice for the experienced investor
• For the normal saver, however, unit trusts tend to be more appropriate as
the investments are managed by professionals who have the skill sets to
make complex investment decisions
DIFFERENCE BETWEEN ETF’S AND UNIT TRUSTS

14. THANK YOU