<\/p>\n
\n\t\t\t\t\t\tI would also like to know which type would be better. <\/p>\n
\t\t\t\t\t\tBy Jonty Sacks, Sacks & Associates<\/p>\n
\u00b7 <\/p>\n
\t\t\t\t\t\t12 Mar 2026\u00a0 04:07\u00a0 <\/p>\n
As a 55-year-old, would it still be advantageous for me to start a tax\u2011free savings account (TFSA)? If so, would it be better to invest in an actively managed TFSA like the Allan Gray Balanced Fund, or in a more passive, lower-cost option such as exchange-traded funds (ETFs) via EasyEquities?<\/p>\n
That\u2019s a great question. In short \u2013 yes, starting a TFSA at age 55 can still be highly beneficial.<\/p>\n
With the current annual contribution limit of R46 000, it will take just under 11 years to reach the R500 000 lifetime cap, meaning you would be around 66 when the limit is reached.<\/p>\n
Read:
Godongwana lifts annual TFSA limit
South Africans leave millions in TFSA benefits on the table<\/p>\n
All growth inside a TFSA \u2013 including interest, dividends, and capital gains \u2013 is completely tax-free, making it an efficient long-term investment for supplementing retirement income or covering later-life expenses.<\/p>\n
Given how few tax incentives are available to individuals, making use of this allowance is a smart and effective way to improve your after-tax returns.<\/p>\n
Investment choice<\/p>\n
Whether you choose an actively managed option like the Allan Gray Balanced Fund or a low-cost ETF-based TFSA through a platform like EasyEquities depends on your preferences, risk profile, and your views on active versus passive management.<\/p>\n
Read: Everything you need to know about tax-free investments in SA<\/p>\n
Over an 11-year period, both can be appropriate \u2013 the key is choosing a solution with transparent fees and an asset allocation that matches your needs.<\/p>\n
Additional benefit to consider<\/p>\n
If your TFSA is issued under a life licence, you are able to nominate a beneficiary. This means the proceeds can be paid directly to them on your death, bypassing your estate.<\/p>\n
As a result, no executor fees (which can be up to 4%) are charged on that investment \u2013 a meaningful saving and an efficient way to transfer wealth.<\/p>\n
Was this answer by Jonty helpful?<\/p>\n
1
\n \u00a0<\/p>\n
#worthwhile #55yearold #start #TFSA<\/p>\n","protected":false},"excerpt":{"rendered":"
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