In Our View, these are the best Interest Rate Investments in SA

The Fixed Rate bonds have a fantastic option to re-start, which means that not only do you enjoy the benefits of a fixed rate should interest rates fall after you have invested, but should rates rise you get to re-start at the higher level!

In Summary

RSA Retail Savings Bonds:

    • Are issued by The RSA Government

    • Incur no charges, commissions or costs

    • Are only available to citizens and permanent residents of SA (with SA ID Numbers)

    • Offer yields that are typically similar to those offered by the large banks, and are higher than those on the same term Government Bonds

    • Are the safest interest rate savings product in SA, i.e. the credit risk is lower than that of the banks. For further comment see this insight

    • Are offered as 2, 3 and 5-year fixed rate bonds, and 3, 5 and 10-year inflation linked bonds

    • Pay out or capitalise interest 6 monthly, except for investors over 60 who have the option to receive interest monthly

    • Offer a great re-start feature on the Fixed Rate Bonds

    • Can be bought in minimum amounts of R1,000, with a total maximum of R5m per investor, per bond type (fixed rate/inflation linked)

    • Pay interest which is treated as ordinary revenue for purposes of income tax

    • Are not transferable to a third party, so cannot be used as collateral for a loan, or security for performance of an obligation

    • Set the interest rates for new investments at the start of each month, based off the level of the RSA Government Bond yield curve at the end of the previous month

      • Details of Current Rates, expectations for future rates and a comparisons with rates offered by the banks are available here

    • Allow full or partial withdrawals after the bond has been held for 1 year. There is a penalty of one interest payment. For investors receiving monthly interest this in not expensive, for those receiving 6 monthly interest it is more punitive

    • Allow full or partial withdrawals, at National Treasury’s discretion, where a bond has not yet been held for a year, only on the grounds of extraordinary changes in personal circumstances

Buying bonds involves registering with the National Treasury, selecting a bond maturity, interest usage and amount to invest, and then paying via internet banking, direct deposit at ABSA, Nedbank, FNB or Standard or at a Post Office Branch.

Full details of the RSA Retail Savings bonds are available at:

The BondClub Tool can be used to monitor and manage your bonds, and will highlight those bonds that are eligible for re-start, and those which it makes sense to re-start.

Our monthly commentary and ongoing insights will also keep you in touch with changes in levels of the various bonds, and how they compare to other investment options.

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