August 7, 2024

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# How much will a savings of 100,000 Brazilian reals yield in 2024? Find out here!

Investing in savings is still a popular choice among Brazilians, mainly due to its simplicity and security. However, many wonder if this is the best option available.

In this article, we analyze how much would 100,000 Brazilian Reals be worth in 2024 and compare it to other investment alternatives to help you make the best decision.

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After all, how do real estate investment trusts work?

## How does saving work?

Savings in Brazil offer a return of 0.5% per month plus the reference rate (TR) when the Selic rate is above 8.5% per year. In July 2024, the Selic interest rate is 10.5% per year​ (Services and information from Brazil)​​ (Central Bank of Brazil), which maintains the savings return at this level of 0.5% per month plus TR.

## Savings benefits

• Income tax exemption: Unlike other investment options, savings income is not taxable.
• No warranty fees: There are no additional fees to maintain the investment.
• protection: It is one of the most secure applications, protected by the Credit Guarantee Fund (FGC).

## Disadvantages of saving

• Low returns: Historically, savings accounts have provided lower returns than other fixed income investments, especially during periods of high inflation.
• Loss of purchasing power: In high inflation scenarios, savings income may not be able to keep up with rising prices, leading to a loss of purchasing power.

## Income account

Let’s calculate the returns from investing R\$100,000 in savings over different periods, taking into account a TR rate of 0.11% in July 2024.

### Income after one month

• equation: 100,000.00 Brazilian Real × (1 + 0.005 + TR)
• Calculation: 100,000.00 Brazilian Reals x 1.00511 = 100,511.00 Brazilian Reals
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### Income after 6 months

• equation: 100,000.00 Brazilian Real × (1 + 0.00511)^6
• Calculation: 100,000.00 Brazilian Reals x 1.03121 = 103,121.00 Brazilian Reals

### Income after one year

• equation: 100,000.00 Brazilian Real × (1 + 0.00511)^12
• Calculation: 100,000.00 Brazilian Reals x 1.062 = 106,200.00 Brazilian Reals

### Income after two years

• equation: 100,000.00 Brazilian Real × (1 + 0.00511)^24
• Calculation: 100,000.00 Brazilian Reals x 1.127 = 112,700.00 Brazilian Reals

### Income after 5 years

• equation: 100,000.00 Brazilian Real × (1 + 0.00511)^60
• Calculation: 100,000.00 BRL × 1.349 = 134,900.00 BRL

## Comparison with other investments

### The silica cabinet

A CIBC is one of the safest alternatives and can offer higher returns on savings, especially during periods of rising CIBC.

• net income: Considering that the SELIC is 10.5% per year and taxes are 15% on income after two years, the SELIC Treasury can earn approximately 8.92% per year.

### CDBs are small banks.

Community development banks often offer higher rates of return than small banks, but with greater risk.

• performance: It can vary, but often offers around 120% CDI, resulting in a total of around 12% per year.

### investment funds

Fixed income mutual funds are another option that can go beyond savings.

• performance: It varies depending on the fund management, but good funds can generate returns of more than 10% per year.

## Final analysis

### Is it worth investing in savings?

Investing in savings can be a good option for those looking for safety and tax relief, but it is not the best option in terms of profitability. With a 10.5% interest rate, alternatives such as Treasury Securities and China Development Banks from smaller banks offer higher returns.

### Final Considerations

If your priority is security and simplicity, saving is still a valid option. However, if the goal is to maximize returns, exploring other investment alternatives may be more beneficial. Always consider your financial goals and risk profile before deciding where to invest.

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For more information on investments and how to choose the best option for you, check out our other articles on personal finance and investments.

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