I am a student and have some money I received as a benefit. I am confused as to how best to use it - either to start a business or invest it so I can live off the income while I continue my studies. I want to study for an honours degree next year and am concerned that I will be expected to use this money to pay my fees for 1997. I am also considering placing this money into a unit trust or fixed deposit, but don't know which is a better investment after tax. However, because each rand earned is so important, risk must be of the lowest order and therefore when saving towards starting a business, I believe that a savings account in a bank is the ideal investment.
Unit trusts are for a longer term of at least three years.
Unit trusts are not free of risk and are governed by market influences. The growth on unit trusts might be greater than the fixed deposit in the long term which is tax-free. The risk element has to be considered taking into account the amount of time you can afford your money to be invested. For your new business I would suggest a fixed deposit. For a longer period unit trusts would probably give you a greater return.