Instead of splurging on expensive gifts this Valentine's, why not get your loved one a gift that will put them in a better financial position?
Ester Ochse, Channel Head for FNB Advisory says, "Valentine's Day is synonymous with partners exchanging gifts as a sign of appreciation for one another. This year, people should think a little differently and consider buying loved ones a gift that will have a lasting impact. This can be done by purchasing a share portfolio for someone or offering to open a Tax Free savings account on their behalf."
"While there's nothing wrong with spoiling a loved one as a gesture of appreciation, buying them an investment product could improve their financial future for the better."
The advantage of buying someone an investment product for Valentine's Day is that you have essentially given them a head-start. For example, if you buy someone a Tax Free Savings Account and offer to contribute a minimum of R300 a month for the next 12 months, by the time the next Valentine's Day comes you would have contributed R3600 into their investment. This is a good way of investing in someone, and it's a gift that will keep on giving because as the years go by it will bear interest.
According to economic data site tradingeconomics.com, South Africa's household savings rate remained unchanged at -0.80 % in the third quarter of 2016. Looking at other forms of gifts on Valentine's Day such as purchasing shares for our loved ones can contribute to changing our savings attitudes and the national savings rate in the long run.
"Investment products are hardly thought of as possible gifts, this too can be a way of showing appreciation for someone without spending large amounts of money. It's even better if the receiver of the gift does not have an investment. The advantage of this is that they will finally have an investment of their own and possibly develop good savings habits" adds Ochse.
