Congratulations are in order for Emperor Asset Management, who today launched South Africa’s first debit card linked to an investment account. Emperor brand manager Lungile Msibi says the card will give investors access to a portion of their funds for emergency use.
“Building up a capital ‘nest egg’ is vital in ensuring a comfortable retirement,” she says. “We all know the rules – start early, and don’t touch your capital. But what happens if you urgently need a large sum of money right now and all your cash is stuck in your investment account for at least the next 24 hours?”
Lungi refers to this phenomenon as “the investor’s conundrum”.
“If I leave all my money in my investment account, I can’t get it out in a hurry, when I really need it. But if I keep a portion of it in available cash, I miss out on the opportunity to earn superior interest.”
The Emperor Debit Card provides the answer. It functions exactly like a regular debit card, but it’s linked to your investment account.
“At the beginning of each month, five percent of the total balance in your investment account is allocated to your debit card,” explains Lungi. “All your funds stay invested until you use the card, which means you get the benefit of investment-account levels of interest plus the convenience of bank-account levels of access.”
The Emperor Debit Card is ideal for people who draw regular income from their investment accounts, such as retirees, and also for those who keep cash in the bank for rainy day.
“The card is not designed to function as a day-to-day account,” says Lungi. “It’s meant purely for emergencies and for people who make regular withdrawals from their investment accounts.”
The Emperor Debit Card is an opt-in service that links to Emperor Asset Management’s segregated portfolios, i.e. the Robert Falcon Scott, Sir Edmund Hillary or Sir John Ross investment strategies, which have had significant investment returns since inception. It in no way replaces any of the current benefits that investors enjoy.
“You’ll still be able to access the balance of your cash within 24 hours,” says Lungi, “but you’ll have to go through the current withdrawal process – you’ll need to fill in a withdrawal form and wait 24 hours to get your cash.”
Lungi emphasises that the card should be used wisely.
“We are certainly not encouraging investors to make withdrawals. Rather, we’re offering a convenient safety net for responsible investors should they ever need it.”
Read more about the card in Cover magazine, RISKAFRICA or on the Emperor Asset Management website.