The beginning of the new year is the ideal time to increase contributions to pension and building savings, but also to invest.
You can start saving and investing money at any time. As well as increasing the storage of financial products that require regular investment. The first group of financial products includes those that are favored by the state in the form of a contribution or a discount on income tax. This group includes supplementary pension savings, building savings and life insurance.
Payment of contributions is agreed between you and the financial institution – most often on a monthly basis, but you can also arrange quarterly or annual. We recommend monthly payments – deposits are lower than when sending a deposit once a year.
Increase in contributions
The benefits of increasing storage come from several levels. In the first case, you will save more money in the following year. The second level is based on the bonus from the state – a discount on income tax or maximization of the state contribution.
Learn how much money you get from the state.
No tree grows in the sky
However, long-term continuous storage increases are not the best way to save or invest. For state-supported financial products, we recommend increasing regular deposits to the maximum amount from which the state will send you the highest possible contribution and at the same time you will receive the highest possible tax deduction.
Think about whether you really need to increase your deposits.
If you have enough free money to invest, look for other opportunities – open-end mutual funds are a good choice. Direct purchases of shares can also be used for regularly invested higher amounts. Take the time to choose stocks – you can be inspired by various indices or funds that also invest in them.
Investment certificates or ETFs are not suitable for long-term investment. They will find their application for a smaller part of your investment portfolio and for short-term speculations.
Calculate the increase
It is better to calculate everything before increasing the storage itself. Enough free money is the first step. The control calculation is necessary especially in cases where you dramatically increase the amount of the deposit itself. Maybe twice. This is not unusual with supplementary pension savings – you can jump from 1,500 crowns to 3,000 crowns. The annual difference is 18 thousand crowns, which you must either already have or be sure that this increase will not burden you.