How to best invest R1.1m

OPTIONS: WHICH INVESTMENT STRATEGY CAN I IMPLEMENT TO IMPROVE MY FINANCES?

- Hannah Myburgh

The question: I would like guidance on my finances. At the moment, I have the following accounts:

→ A R1.1 million fixed deposit at Standard Bank for two years, which matured in December 2024. I was getting about R8 900 interest monthly on it.

→ A Stanlib unit trust account via Standard Bank that acts as an emergency fund because it is readily accessible. It is currently R430 000, and any interest earned is reinvested.

→ A money market account with Standard Bank with a balance of R220 000. I try to contribute monthly to this account and sometimes use the money if I am short on cash.

I changed jobs in 2018 and was paid out an Old Mutual provident fund. My new employer does not have retirement contributions, so I currently do not have any retirement savings. I will be 40 this year.

My questions:

→ Considering my age, what would be the best retirement option to maximise tax savings? I am currently taxed in the 41% tax bracket.

→ How should I reinvest the R1.1 million? I would like to receive a monthly dividend/interest to supplement my income. Previously, if I didn't use the interest, I would add it to the money market account.

→ What other saving/investment strategy can I implement to improve my finances?

The answer: Here's what you could possibly do:

Retirement