DON’T FORGET THE COSTS

YOU NEED to consider investment costs when choosing a tax-free savings account or retirement annuity (RA), says Floris Slabbert, director at Ecsponent Financial Services.

“Informed investors should compare the TIC (total investment charge) and TER (total expense ratio) when evaluating an investment product. Your financial adviser should highlight these costs, as these seemingly small percentages add up over time.”

Slabbert says a 1% saving on costs, if you are contributing to an RA, can translate into a 25% higher retirement value after 40-odd years.

“The true power and reason for investing is for you to work less and your money to work more. Keep your eye on the areas of investment you can control, like fees, how soon you get started, how you maximise your tax benefits and who you choose as your adviser,” Slabbert says.