Thanks for dropping by Safe Investing South Africa. I am on a journey to build wealth my way. For any questions or comments, feel free to contact me.

11 Jan 2022

Tax Free Savings Account and Investment

What is a Tax Free Savings Account and Investment (TFSA)?

Since 2015, SA government decided to gift us with an amazing tax-free product. Contributions to a TFSA are not deductible for income tax purposes. Contributions and income (income tax, dividends tax or capital gains tax) earned in the TFSA are tax-free.

Here's the catch: this is a long-term savings benefit limited to R500,000 contribution in one's lifetime and R36,000 in one year. Withdrawing from this account should be avoided. 

Annual Limit

The Annual limits have been steadily increased from R30,000 in 2016, R33,000 in 2018 and R36,000 in 2021. Maxing the contribution to the Tax Free Savings Account and Investment is ideal. That and not withdrawing, I emphasise. Unused annual limits are forfeited. Important to note is that there is a tax penalty for amounts that are above the annual limit. The tax penalty is 40% on the excess contributions above the annual limit. 

Tax Free Savings Account and Investment

Who is Eligible for a TFSA?

South Africa allows all South Africans to invest in a Tax-Free Savings Account or investment. This includes children. Parents can invest on behalf of minor children.

Maxing out the TFSA should be a priority. The examples in the image above are an indication of how a TFSA can be maxed out every year.

  1. Once-Off Investment. One can invest the full annual limit in one payment. March is the first month of the financial period. However, one can invest at any time during the financial year.
  2. 12 Months Instalments. One can also spread their deposits in 12 equal instalments. This can be automated from your main bank account to the investment tool used for this purpose.
  3. Quarterly Deposits. The quarterly deposits work the same way as any instalment deposits. Any form of instalment works. The amounts deposited do not need to be equal.

The reason March is used as ideal in the example is that, the investment gets a growth benefit for the entire financial period. In a 11.5% return per annum for instance, R36,000 would have grown to above R40,000 at the end of the financial period.

The following accounts qualify to be used as Tax Free Savings Account and Investment:

  • Fixed deposits
  • Unit trusts
  • Retail savings bonds
  • Some endowment policies issued by long-term insurers
  • Linked investment products
  • Exchange traded funds (ETFs).

One can transfer between tax free savings accounts or investments as they change the investment vehicles or service providers. Service providers are responsible to provide SARS with all the information required for tax filing.

Are you investing in a TFSA? Please share the article.

Thank you for visiting Safe Investing SA. For daily motivation like us on FacebookTwitter and/ or Instagram.

Author Mbini Kutta, a businesswoman, personal finance author and investor.


This blog is by design meant to inspire people to learn simple ways of building wealth. Over the years, followers email to get simple strategies to start paying debt, saving and investing. Every year we have a savings culture revival.  This year we are starting our daily savings challenge in February until November. 

daily savings challenge

We are adopting a programme that is similar to a stokvel model. I notice that people are more motivated to save when they are in companies of like-minded individuals or with automated bank transfers. If you are a loner like myself, adapt this daily savings schedule to your needs. These can be used for monthly, weekly or daily savings.

In the first table we are saving R10 on Mondays, R20 on Tuesdays, etc, and a total of R12,070 in the 10 month’s period from 1 February to 30 November. The last table enables one to save a total of R48,280. These totals are own contribution before growth in interest and returns.

How this Daily Savings Challenge Works:

1. Choose a plan that you are comfortable with from the image above. 

2. Decide on the saving frequency. It could be a low amount daily, a weekly amount or a bigger monthly savings amount.

3. Open a savings account linked to your main bank account to easily transfer the amount you have decided on as often as you choose. An interest-bearing account would be ideal for an emergency fund. Some use the Exchange Traded Funds for longer term investments. A savings pocket is usually an interest-bearing account that requires no minimum deposit. However, pay attention to the interest structure. A money market account could have higher returns. If the savings are for a specific cause/ timeframe, a notice account could be the best tool. The ETFs generally have higher returns and are best suited to longer term investments.

Be reminded that the totals in the image above are own capital only without interest or returns. Some of our readers are saving towards their:

Emergency fund.

Children school fees for the following year.

Deposit on a home.

Future renovations.

A wedding.

Deposit on a car.

Investment for retirement.

Investment for passive income like dividends.

Business capital.

Once off event.

Remember, depending on each one's needs, one can save in a notice account, money market account or invest in exchange traded funds (ETFs) for better returns. For those who prefer a higher amount, we will add a few more options. For now, choose from one of our daily savings challenge plans above.

Thank you for visiting Safe Investing SA. For daily motivation like us on FacebookTwitter and/ or Instagram.

Author Mbini Kutta, a businesswoman, personal finance author and investor.

10 Jan 2022


Have you set your own 2022 financial goals? For me the main goal is the standing 'project 2021 July to 2023 June' to double our net worth and monthly income without acquiring new physical assets. It is very ambitious but after such a challenging two years I reckon we deserve a bit of excitement. The previous post detailed the 2021 financial goals review. Let's dip into our 2022 financial goals:

1. Net Worth Tracking. Goals that are shared are more likely to be achieved. Like most bloggers, I come from that background where money talks are a taboo. But writing about my financial freedom journey helped me achieve my goals. So, my first goal is to keep myself accountable by tracking my progress here every quarter. The reason I choose quarterly is that, I update my net worth spreadsheets and report to my family about our progress quarterly. I used to do this monthly but realised that there is too much volatility in a short period. 3 months is also a short period but hey, there has to be a cut off time somewhere.

2. Keeping Focus. In my 2 years of rest I spent a whole lot of time on social media. I realise that I need to schedule my social media times. I can do with limited distraction in my life. Having strict work and family times without social media has become top priority this year. I am catching up on my reading. One huge book done and halfway the second one. I have also set a full day aside weekly to do work for others/freelance work.  

3. Earn More. Right now I am working on increasing our real estate income, as per the main goal above. There are three ways in which we are doing this:

  • Most of 2021 was spend renovating existing property. We had renovations on a small 2-bedroom duplex, our own home, and current renovations in the biggest unit in our multifamily property. The latter should increase the rental income of the unit by at least 60%.
  • I am working on a short-term rentals strategy using the Airbnb model. I will furnish the units that will be let in this way. The first property will be the unit that is in an upmarket residential estate. 
  • We are also working with our town planner to rezone a property which is in an erf earmarked for densification by council. This will be our first 'build to rent' property.
  • Lastly, I will work on increasing the income of this blog. I want to add a channel/ podcast to it by June. 

4. Debt. We will continue to lower the rental property debt. This is a new strategy because of early retirement. We may as well get rid of this debt. This is our only debt. 

5. TFSA. Of course, we are maxing our tax free savings accounts. Mr V spreads his contributions throughout the year. I do a once off payment towards the end of the financial year. I am more likely to forget to do this, so Mr keeps telling me to try and make my lumpsum investment in March. That way I get maximum growth benefit. I need to start listening. We both use ETFs as an investment vehicle for this. It makes sense to use stocks, since a TFSA is more suited to long-term kinds of investment. The Geek (our son) will be having his second year of maxing a TFSA in 2022-23 too.  

6. Education. The plan is to invest in tax education for personal growth this year. A short course to help grow my understanding and learn about new tax provisions and laws will suffice. 

7. Stocks. This is where we plan to invest more to maintain a well-diversified portfolio. We love property and are over exposed in that investment category. We are currently trying to focus on investing in equities. We have both local and international individual stocks and ETFs. 

8. Retirement. We continue contributing to our retirement accounts. We only have this increased by 10% annually. Mr V and I both have 2 retirement accounts each. We have a retirement annuity each, Mr V's employer linked pension and my pension preservation fund. I have been tempted to cash my preservation fund a few times in the past. But I also think I need this kind of a safe option.

9. Family Finance Alignment. Every quarter I track progress on our goals and discuss with family. This way, our plans are aligned. We all pay attention to global economic conditions, to reshuffle our investments as a need arises. I am the one tasked with a responsibility to take some sort of a lead on this this year. So, I start my days with some light markets reads.

10. Will vs trust. Right now I am investing in weighing the pros and cons of a trust. We still do not have a family trust. We have been dragging our feet because of the expenses that will go with the transfer of assets. I'm onto it this year.

11. Getting rid of assets. The other important item on my to-do list is getting rid of all small property units. I no longer want to keep the apartments in our portfolio. We currently prefer the multifamily rental property. We have 3 units to sell in the year. This will depend on the property market conditions. If prices drop, we will just hold a bit longer.

12. Giving. I keep forgetting to mention this. We give over 10% of our income as a principle. As a family we assist our parents financially and have a scholarship. We have foster kids that attend a small private school on this family scholarship. We believe in this kind of giving.

Please share your own goals with us.

Thank you for visiting Safe Investing SA. For daily motivation like us on FacebookTwitter and/ or Instagram.

Author Mbini Kutta, a businesswoman, personal finance author and investor.

7 Jan 2022


 When Mr V (husband) and myself planned our lives together in our 20s we took a decision to focus more energies on our family and family businesses and less on top careers. We had decided on shorter career lives. This was before the ‘fire movement’ came to be. For those who do not know, ‘FIRE’ is an acronym for ‘Financial Independence Retire Early. We never imagined that this decision would be the one thing that gives us purpose and a strong joint passion. Financial independence and early retirement were the goal. I have been outside formal employment for almost 5 years now. I also took my semi-retirement break at 35.

The past few years were super challenging. We lost my mother in December 2020. The pain that I went and am still going through cannot be articulated. My mother was a close friend. The year 2020 was the most difficult year globally. I have not blogged in both 2020 and 2021. However, in 2021 I went back to tracking my finances. This was a needed distraction. 

Back in January 2020, our family’s financial plan was to double our net worth and income in two years without acquiring new physical assets. Then 2020 turned to be the weirdest period of our lives. I rested more that year. The plan to double our net worth was only implemented in mid-2021. My excel spreadsheets and graphs are beautiful to watch every quarter.

Whilst excel is great, I miss keeping myself accountable through blogging. I will use this platform to keep track of the progress in our ‘project July 2021- June 2023’. It will take a lot of doing to achieve this goal but it is doable. The detailed plan for 2022 will follow in the next blog post.

2021 Highlights:

1.Stocks. What we have done from July 2021 is increase our investments in stocks. We did get lucky with the SASOL dip and the great performance of the US dollar stocks in the past year. The year or semester rather, was great. We did not forget our tax free benefit accounts which are also in Exchange Traded Funds (ETFs).

2. Rental Income. We also had major renovation projects to increase the rental income. One renovation project was in our multifamily let. We renovated the biggest unit. This property has 6 lease contracts in it. We are finalising this remodel project soon. The renovation should increase the income of the unit by 60%. The plan was to further develop this property. The city’s 2018 Regional Spatial Development Framework (RSDF) removed the erf from the area that they earmarked for densification. So, we could not.

3.Retirement and savings. We also contribute to our retirement accounts monthly. We each have two accounts with one being a retirement annuity. The performance is not stunning, but they are a great addition. We also keep some small figure in savings to serve as an emergency fund. We no longer have a big sum in the emergency funds accounts. Interest rates are too low for that. My zero-fee credit card is my emergency account. I never pay interest on a credit card.

4. Gigs. I achieved more in 2021 than I did in the past few years. My freelance income has been channelled to fast-track Mr V’s retirement. This deserves a separate post.

5. Content creation. My content creation income was very small. Like I mentioned, I went AWOL. See next blog post for the plans for 2022 on this.

6. Speaking. I was a visiting lecturer and had a few speaking appearances last year. Noteworthy is my appearance as an expert at an ‘Africa Trade Conference 2021’ and the full week radio show talks.

7. Wealth transfer. The Geek (our son)  turned 18 in 2021 and started on the investment journey of his own. The boy has done very well and invests in the US stocks and ETFs exclusively. He has impressed us by his focus on managing his finances. We have discussed building a good credit rating record and getting his first credit card. We are also helping him max his tax-free savings account. 

8. Budgeting. I still work with a budget that is in my head. Budgeting never works for me. I make my targets, save, invest and then spend. Paying myself first helps with my impulsive habits. 

9. Debt. On debt, we still only have investment property debt. We also have reduced this remarkably in 2021. We are generally not bothered by rental property mortgages. Our priority is having no debt in our primary home and no debt anywhere else. This has always been the case.

10. Travel. I had plans to travel in 2021. Ireland and Egypt were on the list. Due to the pandemic I only managed to travel between Angola and South Africa. I am looking forward to open borders. The family’s feet itch.

11. Comfort. Our primary home was the most costly project for the year. We are a family that believes in comfortable living, and always prioritise comfort and healthy food. OH, we sure love our food. We did get approached by interested prospective corporate tenants to lease this property. I was welcoming the idea of great income, but Mr V and the Geek refused to let go.

12. Finally, 2021 had its challenges. We had a few months of vacancies and unpaid rentals due to the pandemic. This is not common as we invest mainly in the heart of national government and diplomat presence. Our 2022 goals will highlight how this discomfort pushed us to grow. Our investment city is also growing and is now with a population of over 2.5 Million.

Thank you for visiting Safe Investing SA. For daily motivation like us on Facebook, Twitter and/ or Instagram.

Author Mbini Kutta, a businesswoman, personal finance author and investor.