Guiding consumers since 2009

Money growing on trees

By Staff Writer
Nedbank revealed that its Retail and Green Savings Bonds had generated savings of R8 billion in just over two years. 
 
Launched in 2012, the Nedbank Green Savings Bond enables South Africans to contribute towards the creation and development of the green economy, while saving for their future.

 As such, the capital raised from this bond is channeled towards the financing of renewable projects in South Africa – at no cost to the investors.
 
“We are delighted to see the growth in Nedbank Green and Retail Savings Bonds. These recent innovations allow our clients additional savings opportunities, contributing towards increased awareness of the importance of savings.

Getting on top of our individual financial affairs is so important. It is something we are committed to helping our clients with,” said Anton de Wet, managing executive of client engagement at Nedbank.
 
In South Africa, the green bonds universe is still in its infancy and the government has adopted renewable energy as a platform, both to meet its international commitments to reduce greenhouse gas emissions as well as a way of developing a sustainable energy policy. 
 
“The Green Savings Bond presents a hard investment case in that investors now have the opportunity to play a significant role in not only lowering the risk of climate change, but also investing in a sustainable solution. The important message investors need to hear is that backing green investments does not mean compromising on returns,” said Mike Peo, head of infrastructure, energy and telecoms at Nedbank Capital.
 
Can everybody invest in green?
 
An analysis of the profile of the Nedbank Retail and Green Savings Bonds investors revealed that 80% of the book was accounted for by savers older than 40. 
Sasfin financial consultant, Gavin Came, said that this type of investment won’t suit all individuals as you need to diversify your portfolio as far as possible.
 
“A sophisticated or older investor (over 40 years) usually has money and can afford to put a big amount of money in one type of investment.

You need to consider what proportion of your assets would make up a bond like this. To be safe you shouldn’t put more than 5% of your money in one type of investment,” said Came.
 
Nedbanks’s profile also revealed that over 13% of the investors are between the ages of 20 to 39, with 7% under 19. 
 
But Came advises  young people to steer clear of bond investments because the interest rates are low for an age group who should be taking risks on more aggressive investments.
 
Financial planner, Louis van der Merwe, said this type of option would also not be suitable for investors who require access to their capital before the end of the investment term. 
 
“As the returns will be in the form of interest, it would not be suitable for individuals with a high marginal tax rate and investments of more than R500 000 in fixed income instruments (bonds & cash).

This would also not be suitable for investors trying to achieve any capital growth as they will most likely reduce the value of their capital in real terms (after inflation),” he added.

Recent Articles

Featured Ensure your family doesn’t feel the impact of your retrenchment

Retrenchment doesn’t only change the way you view yourself; it also alters the relationship between you and your family. Things can go from good to bad within a short space of time. But you can do something to prevent your family from feeling the impact of retrenchment.

Someone got injured on my property – now what?

Life is unpredictable and no matter how careful we are, accidents happen. But what if someone has an accident while visiting your house? Your guest could fall off the stairs, slip on the floor or get bitten by your dog. 

Are you ready for a house upgrade?

You moved into your home knowing one day you would need to make some changes to turn it into your dream home - add a new bedroom, a second bathroom, build a double storey or even move out.

How income protection can help you when you’re sick

Your greatest asset is probably your ability to earn an income, which provides a certain lifestyle and the capacity to take care of your dependants. That’s why it’s so important to protect your income against unforeseen illness or injury and to provide for your dependents after your death.

Deals

Register for a free online course with Wits

Price: Free
When: Daily
Where: Online

Edgars slogan T-Shirts from R60

Price: From R60
When: While stocks last
Where: Nationwide

3 Months Free on Samsung Galaxy A7 contract

Price: From
When: Daily
Where: Nationwide


Latest Guide

Complete guide on personal income tax