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How to Start Saving and Investing in South Africa

Starting to save and invest for your financial future can be complicated, because you now need to understand new financial terms, various bank account options, and investment products.

Many of us understand that we need to secure a financially stable future, but don’t know where to begin.

This guide will explain the basics of saving and investing, from setting goals and understanding different savings accounts to exploring investment options like stocks and unit trusts.

Whether you’re completely new to finance or you just need a refresher, this guide will give you clear, practical advice to kick-start your saving and investing journey in South Africa.

The First Step is to Define Your Financial Goals

Before you can start saving or investing, it’s vital that you clearly understand why you’re doing this.

Your financial goals are your foundation and determine the type of savings or investments you will choose, as well as help keep you focused along the way.

Setting specific goals makes it much easier to decide which savings or investment options you need to reach that goal. Knowing where you want to be and how long you need to get there helps with making better decisions on when to be conservative or take calculated risks, which can increase rewards!

Short-Term vs. Long-Term Goals

Short-Term Goals

Short-term goals are goals you would like to reach in the next 1–3 years, like:

• Creating and building an emergency fund
• Saving for a holiday
• Making a deposit payment on a car

Long-Term Goals

Longer-term goals can take 5 years or more to achieve and include:

• Buying a home
• Planning for retirement
• Funding a child’s education

Saving

Your First Goal is to Build an Emergency Fund
This fund is your financial safety net for unexpected events.

You should have at least 3 to 6 months' worth of living expenses that can protect you from unexpected costs, like medical bills or car repairs
This way, you won’t have to withdraw from your investments, which would reduce future maturity values.

Tips for Building an Emergency Fund
Start small by saving just R500–R1,000 if that’s all you can manage. Every little bit counts.
Automate your savings through a monthly debit order into a dedicated savings account.
Choose an easily accessible savings account so you can withdraw funds at short notice if needed.

According to the South African Reserve Bank's 2022 Financial Stability Report, households with emergency savings were 73% less likely to face financial distress during economic downturns.

Investing

Investing is where your money really starts to grow and work for you.
The key difference between savings and investments is that investments carry more risk but also offer the potential for greater rewards.

Types of Investments in South Africa

Stock Market
This is where you buy shares in companies listed on the Johannesburg Stock Exchange (JSE).
As these companies do well, their share prices go up, increasing your investment’s value.
However, the stock market can be volatile, which makes these investments best for long-term goals.

You can invest through a JSE-registered stockbroker, either via traditional brokers or online trading platforms.
Consider ETFs or index-tracking funds as simpler, lower-cost alternatives for beginners.

Unit Trusts
Unit trusts pool money from multiple investors to buy a diversified mix of stocks, bonds, or other assets.
They’re professionally managed and offer more stability than individual stocks, making them a great option for beginners.

Government Bonds
Government bonds are low-risk investments where you lend money to the government in exchange for regular interest payments.
They’re ideal for risk-averse investors or those nearing retirement.

Choosing the Right Investment for Your Needs

In South Africa, several account types are available for starting your investment journey.
Here are some of the most popular:

Tax-free Savings Account (TFSA)
You can save up to R36,000 per year without paying tax on the returns, with a lifetime contribution limit of R500,000.
TFSAs can hold a mix of investments, including ETFs, unit trusts, and bonds, making them versatile for beginners.

Retirement Annuities (RAs)
Retirement annuities are great for long-term goals like retirement.
Contributions are tax-deductible, reducing your annual tax burden.

SARS are helping pay for your investment!

Although you have limited access before age 55, RAs are an excellent way to secure a financially stable retirement.

Investment Platforms

Platforms like Coronation and many insurance companies allow you to buy and sell stocks, ETFs, and unit trusts.
They’re accessible, low-cost, and perfect for beginners who want to manage their own portfolios.

FAQ

What’s the minimum amount I need to start investing?
You can start investing with as little as R500 per month with most unit trust investments.
Starting small and gradually increasing your investment over time is a great approach.

Is it safe to invest in the stock market?
Investing in the stock market carries risk.
However, by diversifying and investing for the long term, you can reduce this risk.

Consult with us to find out what your risk appetite is before choosing stock investments.

How do I know if I’m ready to invest?
If you have an emergency fund and little to no high-interest debt, you’re likely ready to start investing.
A stable income also helps you maintain regular contributions to your investment portfolio.

Take Action and Start Growing Your Wealth Today

Starting to save and invest may seem complicated, but with the right tools, knowledge, and help from us, you can confidently begin your wealth-building journey.

By setting defined goals, building an emergency fund, and exploring investment options, you can create a solid foundation for your financial future.

It’s never too late to start—so why not begin today?
And remember, the secret to building wealth is compound interest: getting your money to earn money, so start today!

The biggest obstacle for most people in creating wealth is that they feel they do not deserve to be rich! They have grown used to not winning the Lotto or struggling to make ends meet. They constantly hear from others just how bad the economy and how hard life is. And, if they do succeed, they are not skilled in keeping and growing their money.
This is so untrue!

The starting point of your wealth creation is for you to believe you can accumulate all the wealth you need and that a lot of money is a good thing.

Maybe you feel that is too hard or too risky or that you need a lot of money to invest?

Again, not so, and I can show you how to get going!

The earlier you start, the more money you will earn.
The effect of compound interest is huge, however it needs time to really work for you.
The sooner you begin, the sooner you can reap the rewards.
The longer you invest, the more your money works for you.

Just begin today!

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Important Disclaimer:This content is for informational purposes only and does not constitute financial advice. Past performance is not indicative of future results.
Please speak to me before making any decisions.

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Last update: August 10, 2026