Companies have been racing to capitalise on the tax-free savings accounts. We sum up what products have come to market so far.

Financial product providers have by and large brought out two types of tax-free savings accounts (TFSAs): a basic bank savings account which earns interest, and an investment product for longer-term investments.

In terms of fees, as always, the more choices you are offered on the platform, the more you will pay. The most cost-effective products are those that are the simplest and offer a plain in-house fund.

Bank savings accounts for shorter- to medium-term goals

Nedbank’s bank savings account has the lowest minimum amount of R50 per month, while Investec has the highest minimum – a R30 000 lump sum investment – but offers the best interest rate.

The Nedbank tax-free savings account
Minimum deposit: R50 a month or lump-sum deposits up to a maximum of R30 000 a year.
Accessibility: You can access your funds within 24 hours
Interest: Earn interest up to 5.25% a year
Features: You can opt to earn compound interest or you can opt to have the interest you earn paid into another existing bank account. There are no fees, commissions or penalties on this product.

First National Bank (FNB) tax-free cash deposit account
Minimum deposit: R1 000
Accessibility: You can access your money within 32 days
Interest: 5.25% a year if your savings are more than R20 000 and at lower rates for lower savings amounts

Standard Bank tax-free call deposit
Minimum deposit: R250
Accessibility: Immediately available to you
Interest: You earn interest on a tiered scale, starting at an effective 5.01% for amounts between R250 and R5 000 and going up to an effective 5.48% for amounts between R20 000 and R30 000.
Fees: Note that while you are not charged fees for deposits, you will be charged each time you make a withdrawal.

Investec tax-free fixed deposit
This is a 12-month fixed deposit
Minimum deposit: R30 000
Interest: Fixed interest rate of 7.31%
Fees: There are no fees however if you withdraw the funds before 12 months, a penalty may apply to a maximum of R300.

Funds for longer-term investments

The monthly contributions to these funds start at R300 for the FNB tax-free share account, up to R1 000 per month for Momentum products. Be aware of the underlying fees for funds offering actively managed porfolios – these need to be added to the cost of the product.

Newcomer to investments, 22Seven, has differentiated itself with a completely online application process which can be completed in less than half an hour.

The Nedbank tax-free investment account
Minimum deposit: R500 a month or a lump-sum deposit of R10 000
Accessibility: As the underlying investment is a unit trust fund, you can access your money within 24 to 48 hours
Features: You can choose from a number of underlying unit trust fund investments. Although each fund will have administration fees, there are no performance fees. There are no exit penalties or early termination fees.

Satrix products
All Satrix products, both unit trusts and exchange-traded funds, are available as tax-free savings vehicles.
Minimum investment: R500 debit order or R10 000 lump sum on unit trusts; R300 debit order or R1 000 lump sum on exchange-traded funds
Accessibility: You can access your money within 24 to 48 hours
Fees: Satrix flagship fund fees excluding VAT: Satrix 40 – 0.45%; Satrix Balanced – 0.6%; Satrix Low Equity – 0.6%; Satrix MSCI World – 0.5%; the other unit trusts fees are 0.45% except for Rafi which has a fee of 0.6%. Fees on all ETFs are at 0.4% except for Rafi which is at 0.46%.

22Seven tax-free savings account
22seven is a free online service as well as free app available for download which allows users to see all of their money in one place.  The company has brought out a simple, easy-to-access tax-free savings account. The sign-up process is 100% online and can be done on your mobile phone. It takes just minutes to open an account. You can withdraw money any time without being penalised.
Minimum investment:  R350, once-off or monthly
Funds: You can select from Old Mutual Core Diversified or Old Mutual Top 40
Fees: 0.68% including underlying management fee

FNB tax-free shares account
Minimum deposit: R300 debit order or R1 000 lump sum
Accessibility: You can access your money within 24 to 48 hours
Fees: 0.4% (plus VAT) a year

Old Mutual tax-free plan
Minimum deposit: R350 a month or R5 000 lump sum. You can also invest according to your individual requirements, for example, R1 050 each quarter, R2 100 twice a year or R4 200 a year.
Fees: A minimum of R20 a month or 0.75% a year. This fee is reduced if you choose underlying funds from Old Mutual and invest the full R30 000 per year. Note that you will also be charged underlying asset management fees and if you invest via a broker or financial adviser, you will have to pay advice fees.

Stanlib tax-free savings account
Minimum deposit: R500 debit order or maximum debit order of R2 500 a month or a minimum lump sum of R5 000.
Accessibility: You can access your money within 24 hours.
Fees: There are no performance fees but if you use a financial adviser, you can be charged an initial advice fee. The underlying fund will carry an annual service fee, which may include a trail fee to your financial adviser.

Alexander Forbes tax-free savings account
This is a savings account, which can be structured to suit your savings goals so your monthly deposit will vary depending on the investment structure you choose.
Fees: The three different investment options carry fees as follows: high risk/high return – 1% a year; medium risk/medium return – 1.2% a year; low risk/low return – 0.4% a year
Momentum Flexible tax-free option
Minimum deposit: R1 000 a month or R15 000 lump-sum deposit
Fees: You can invest in any qualifying unit trust and pay the underlying retail management fee