With 2020 nearly upon us, with all the excitement and anticipation of both Christmas and the New Year, it may behove us to remind ourselves how important it is that our bonuses and salaries be judiciously used.
Saving for retirement should be one of our top priorities and should be front of mind before splurging our hard-earned cash during the holiday season. What about adding some of it to your retirement savings. Think of it as a very early Christmas gift that you will enjoy in your retirement.
Apart from thinking of the future and enjoying the thought of a stress-free retirement, the major benefit of contributing to a retirement annuity is the savings on tax. The contributions you make could potentially qualify for a tax deduction which can be utilized to offset your taxable income during a tax year. The result is that your taxable income and tax payable will essentially decrease.
You may deduct up to 27.5% of the greater of your remuneration or taxable income in respect of total contributions made to your retirement funds, subject to an annual limit of R 350,000.
Even though the current tax year ends 28 February 2020, make an additional contribution as soon as possible if you have not done so already. This avoids the deadline rush!
If you are unsure of how much you may still contribute, give us a call. We will gladly assist. If you have online access to your investments, we also encourage you to invest using that option. We receive notifications of all online transaction and if any problems arise, we will let you know.
Season’s greetings and happy savings!