#SayNoToLazyMoney! Are you one of the millions of South Africans with ‘lazy money’ sitting in your current or cheque account, earning no interest whatsoever?
Research shows you’re not alone! There is R295-billion-worth of lazy deposits in SA. If this money earned just 4.75% interest per annum, that’d put over R14-billion into South Africans’ pockets. Imagine all these people switched to Capitec and did just that – earned from 4.75% interest p.a. on their transactional accounts.
The reality is many of us need quick access to our money, so we frequently fail to move funds into the savings accounts that’ll earn us optimal interest. Francois Viviers, Executive: Marketing and Communications at Capitec Bank, says the opportunity cost is immense. “We want to help South Africans bank better so that they can live better. Providing clients with interest on their transactional account is one keyway we are doing this. We believe your main account should grow your money and not just hold it. In the last year, Capitec clients have earned over R 1.2 billion in interest on their transactional accounts alone.”
MAKE YOUR MONEY WORK AS HARD AS YOU DO!
Capitec clients begin earning interest from the first rand deposited into their transactional account. The interest is calculated on your daily balance, which means that your money is working for you, while you’re working to make further money.
Viviers says that clients can make their money work even harder, by moving it across to one of their four free savings plans, which earn up to 8.55% interest pa. Here are some of his top tips to taking control of your money, while maximizing the interest you earn.
1. Pay yourself first: This is a core principle to accumulating wealth. The rule of thumb is to save at least 15% of your income before you start spending. Set granular goals you want to save for – a holiday, a side hustle, a new learning adventure – and speak to your bank about what savings plan is appropriate to get each goal off-the-ground.
Tip: Take full advantage of the four free savings plans Capitec offers clients. Set up recurring payments on the app to take the thinking out of saving. The money will automatically be transferred to your savings account each month making saving easier.
2. Go digital and stay in control of your money: Use your bank’s app to easily keep track of your spending in real time. Don’t wait for your monthly bank statement to see how you are spending your money each month. Digital banking allows you to check balances in real time and view statements to see where key spending areas are.
Tip: Reduce your monthly bank fees by avoiding transactions that involve cash or branch visits. Digital banking is more affordable and Capitec recently lowered their digital banking fees. It’s a simple way to manage your money and maximise the ways you save.
3. Avoid high banking fees: R105 is the average monthly bank fee for South African banks. This works out to R1260 per annum, which is enough to pay for a return flight from Johannesburg to Cape Town and three night’s accommodation within four years. The average Capitec client pays just over R50 per month in fees.
Tip: Check your bank statement to see how much you pay each month in bank fees and take control of your money. Your monthly fee saving can then be placed in a savings plan, to help you earn even more money.