Types of savings products

By Drum Digital
09 July 2014

Want to start saving but don’t know where to start? Here are tips from experts.

There is just no excuse anymore – the time to start saving is now!

There are a variety of savings schemes for lower income earners in South Africa today, both formal and informal.

“There is a strong need for South Africans to change their financial behaviour,” says Kabelo Makeke, Head of Inclusive Banking at Standard Bank.  “We are among the worst savers in the world. Many South Africans take out loans or they over extend their credit which puts them into debt.  And debt is very difficult to get out of.  Even if you earn a low income, you do need to save a percentage of it each month.”

The FinScope SA 2013 Consumer Survey lists the different types of savings products on offer as follows:

  • Long term formal savings include education policy, investment/savings policy, endowment policy and off-shore investments, provident fund, and retirement annuity and pension fund.
  • Medium term formal products: unit trusts, stokvel account at a bank, share on the stock exchange, other shares such as Sasol shares and government bonds.
  • Short-term formal savings products: deposit account, call account and money market account.
  • Informal savings include: stokvel/umgalelo and investment/savings club.

- Standard Bank

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