So does this mean that we should not give investments as presents at all? No. It merely means that we need to be smart about it and not have our unwitting beneficiaries being stuck with the temptation of spending it early. By rather investing on their behalf ? unbeknown to them ? an annual 'gift' of R300 invested in equities from the age of one to the age of 21 will pay out about R30 000. This is perhaps not only a nicer present, but also a more practical one to give at the age of 21.

What the above argument boils down to is, to my mind, a very simple rule of thumb. If you are going to give presents, rather give the end result (after years of saving it). By the time you do give it, not only will it make a more profound difference to the life of the receiver, it will also be given at a time when the receiver?s maturity and need to use it wisely will be where we intended all along. The best way to give an investment is as the cash at the end of it.

acsis Limited is an authorised financial services provider. The response to the question covers some of the issues in a general and factual manner and does not constitute advice. It is important to consult with a financial planner who, after an analysis of the individuals? personal needs, goals and circumstances, will be able to provide comprehensive and appropriate advice.

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