New to RSA Retail Savings Bonds?

In our view, RSA Retail Savings Bonds are the best interest-rate investments available in South Africa. The fixed-rate bonds carry a re-start option that lets you keep the upside if rates rise after you invest while still locking in today's rate if they fall. No other retail savings product in the country offers this asymmetry.

In summary

• No fees. No charges, commissions, or platform costs of any kind.
• South African residents only. Citizens and permanent residents with an SA ID number.
• Yields are competitive with the big banks and consistently above same-term Government bond yields.
• The safest interest-bearing savings product in SA — credit risk is lower than the banks. See Is my money safe in RSA Retail Bonds?.
• Three product families: 2/3/5-year Fixed Rate bonds, 3/5/10-year Inflation-Linked bonds, and the 3-year Top-Up bond.
• Interest options depend on the bond. On Fixed Rate bonds any investor can choose monthly or 6-monthly payments, or capitalise the interest. Inflation-Linked bonds pay 6-monthly and the Top-Up bond capitalises.
• The Restart feature on Fixed Rate bonds lets you reset the contract at the prevailing rate if rates have moved up since you bought. See When the Restart option is worth using.
• Minimum R1 000 (R500 for the Top-Up bond), with no maximum.
• Interest is taxable as ordinary revenue. See Interest exemptions and the over-65 threshold.
• Not transferable. You cannot use a bond as collateral for a loan or as security for an obligation.
• Rates are reset at the start of each month by National Treasury, based on the level of the SA Government bond yield curve at the end of the previous month.
• Redemption after 12 months is allowed at the cost of one interest payment. For investors taking monthly interest the cost is small; for those on 6-monthly interest the cost is more punitive.
• Early redemption inside the first 12 months is at Treasury's discretion and only for extraordinary changes in personal circumstances.

Buying

You register on the National Treasury RSA Retail Savings Bond website, choose a bond family and term, decide on the interest option, set the amount, and pay by EFT or direct deposit.

Managing

Bond Club's portfolio tool keeps track of your holdings and flags which bonds are eligible to be re-started, and which it makes sense to re-start now versus leave alone. Our monthly market commentary shows where current rates sit against history and against alternatives.