Don't wait until you have a large amount of money to invest: the key to building wealth is just starting somewhere and letting your returns generate over time, says Ebrahim Moola of Bobats Wealth Solutions.

According to Moola, it's about forgoing consumption today - when you're able to set monies aside, while still generating an income - for the sake of future consumption, when you may not be earning as much or at all.

This is because of the compounding of returns over time, he explains.

"The magic of investing is the compounding of above-inflation returns over long time periods which effectively increases the value of your future consumption.

"So, investing R10 000 today is a key contribution that your future self and family will be super grateful for," says Moola.

"The key to investing is starting somewhere and to stick to a plan, ideally through a trusted financial advisor and via an automated mechanism like debit orders."

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"You need go through the hard yards of consistently saving for at least 7 to 10 years to accumulate a pot of cash. It's only then that your investment portfolio can start working for you and returns start to matter and it takes well over 20 years for your contributions to become meaningless relative to your portfolio's returns," he explains.

Save on tax

He suggests using tax-efficient structures like tax-free investment accounts and retirement annuities where possible and to get a reputable financial advisor to help.

"Whilst SARS is a swear word in many South Africans' vocabulary these days, these tax efficient structures, if used properly to accumulate capital, can save you huge amounts of tax over your lifetime," says Moola.

"The key is to maximise after-tax returns over the long term, which these structures provide."

For long-term investments, he suggests you allocate your monies towards diversified equity and property investments, both locally and abroad.

These asset classes (equity and property) have a long history of generating the above inflation returns critical in growing the real value of your money, and hence your future consumption. Again, a reputable advisor can guide you in building a suitable portfolio.