So as you know, Take Charge of Your Money is all about sorting out your finances and taking charge of what you have! Let’s look at how you can invest with only R100 per month. Of course, if you have more available then you can still read this to see what investment options are available.
Before we start though, have a look at whether it’s better to save money or pay off debt. The bottom line is that if you have any debt with a high interest rate (over 15%) then you’ll almost certainly want to pay that off first. It’s pointless investing money at a lower rate than what you’re paying for your debt!
Minimum investment amounts
When looking at investing you’ll generally need to interact with an investment company such as Old Mutual, Allan Gray, EasyEquities, 10x Investments, Prudential, etc. (there are many companies legit investment in South Africa!). Each company will have its own requirements as to minimum monthly investment amounts and most of the “big ones” require at least a R300 per month debit order. Some in fact even require a minimum of R500 per month.
That’s great for their business but what about the investor who only has R100 per month and wants to invest it wisely? So where to invest in South Africa? All banks offer a sort of fixed deposit account which is a good start, and call accounts also offer a fair interest rate too. Many banks also offer other investment products such as a share trading facility, at a cost of course! In this post we’ll look at alternative options to banks. Maybe I have a general distrust for banks, but that’s not the point. I’m interested to see where else you could invest your R100 per month.
Also remember that just because you have a small monthly investment, you are certainly not limited to short term investments in South Africa. It really depends on your intention for your investment. If you are saving for something and need the cash in a year or two, that would be considered short-term and low risk. If you’re investing for the future, then there are many options available.
Beware of scamsters
Note: when dealing with any financial institution make sure that it’s a registered Financial Services Provider and has a valid FSP number. Don’t be conned by your ‘Uncles friend who has a friend’ kind of thing. Stick to legit investment companies and trust me, if it looks too good to be true then it is.
Where can I invest with only R100 per month
I’ve done quite a bit of searching and to be honest I haven’t found many options for someone who simply wants to invest R100 a month into a product not offered by a bank. There’s nothing wrong with banks, I just thought I’d see what other options are available.
This is by no means an exhaustive list and I will edit is as I find out more info or learn about new products. I am also not advertising these companies, I’m simply conveying info that I have found on the various websites.
If you have more info for me to add please let me know via the comments or email. Note that this is in relation to South African investment options only and are absolutely legit investments.
EasyEquities is probably one of the simplest and cheapest investment platforms in South Africa. There is no Easy Equities minimum deposit so you can literally deposit any amount into your Easy Equities account and then invest it in shares or ETFs. You could for example transfer R20 a month to your Easy Equities account if you wanted to, or a far larger amount. It’s a really cool platform used by many “big time” investors as well as the newbies. They also offer US dollar based investments as well as TFSA’s (tax free savings accounts).
So if you want to start trading with R100 or buy shares for R100, Easy Equities is a good option.
I have an Easy Equities account and love it! Easy, cheap, transparent and gives you the power to choose. Read about my first investment with Easy Equities.
Liberty Stash is a mobile app which will help you save money and invest it in a Tax Free Savings Account which tracks the JSE/FTSE Top 40 index. Have a look at what ETFs are to get an understanding of an index tracking fund.
It seems like a fun app as you can round up all your card purchases and invest the spare change. Invest based on the weather (invest on sunny days) or invest based on your physical exercise. Sounds like they’ve made investing pretty fun.
I’ve never used this app so if you have any feedback please let me know!
TymeBank is a bank so technically speaking I shouldn’t add it to the list. However, it’s very different to a standard bank as we know it. TymeBank is an online-only bank only with no physical branches. They don’t charge bank fees and can offer you a simple banking solution.
I have never used them but looking at their GoalSave account they offer a notice-period account whereby you receive a higher interest rate the longer you leave your money in the account. Up to 10% which is pretty decent!
Use your Home Loan
Ok so this is also a bank and technically speaking shouldn’t be on my list. However, if you have a home loan you can save money in there and earn a good interest rate. If your home loan interest rate is say prime + 1, you can earn interest on your savings at that rate. You don’t earn the interest in the account in a standard way, but rather your overall loan is reduced by the interest you save. Sounds confusing maybe but have a look at how to use your home loan as a savings account.
OUTVest is part of the OUTSurance family and offer a few index tracking funds where you can invest a minimum of R100. They also offer a cool feature called Crowdvest which is a way of allowing your friends and family to contribute directly to your investment. You could use this as a wedding or birthday gift idea or even create an education fund for your child which people can contribute to.
I don’t have any OUTVest investments and haven’t looked carefully at fees or costs involved. Please share your feedback if you have invested with them.
The Franc App is an investment app offered by the Franc Group in South Africa. They only cater for investments in the Satrix Top40 and the Allan Gray Money Market Fund. You can invest with R100, or any amount that you have. They charge an overall % annual fee.
It’s amazing how few options I have found (besides banks) where you can invest R100 per month. Most fund managers are only interested in investors who have at least R300 per month to invest, and some even require more.
Don’t let this make you feel despondent though. You really can take charge of your money and invest whatever money you have available! So if you have more, investing it would be a great way of how to use R1500 wisely.
EasyEquities seems like the obvious choice though as they give you absolute freedom to invest as much or little as you can, as well as choose exactly what to invest in. You can invest any time of the month, trade, view your account balance, etc. All online and all in a simple to use system.
If you know of any other legit investment companies where you can invest R100 or buy shares for R100 only, let me know and I can keep this list up-to-date.
BONUS As a bonus suggestion – why not try the 52 Week Savings Challenge?
Not sure what it is? That’s okay – you can read all the details about the 52 Week Savings Challenge here.
I’m happy to hear your thoughts on any other investment options you know of that caters for R100 per month.
And have you by any chance been wondering where to find the best savings account in South Africa? Read my post on that – it’s geared towards students but check t out.