On December 31, the deadline for workers to withdraw 100% of the funds from their deposit of CTS, as established by Law No. 31171, which authorizes the provision of compensation for time of service in order to meet the economic needs caused by the COVID-19 pandemic.
In this context, Jaime Aritio, Renta 4 SAB’s Deputy Manager of Business Development for Latin America, offers some advice to make a responsible use of this capital.
According to the specialist, the first thing to keep in mind is that the CTS is an emergency fund and as such should be avoided spending it on high-risk products.
Key features
Against this, Aritio identifies two fundamental characteristics when saving or investing funds. “The first is high availability, that is, the possibility of withdrawing this capital from one day to the next in case of need. The second will be to seek a return higher than inflation, but with low risk through conservative or moderate savings or investment products ”, he highlights.
Save or invest?
If you decide to invest the money from your CTS account, you should consider that there are several options “such as starting a business idea, factoring, franchises, real estate, setting up a startup, the stock market, among others,” according to Diego. Poblete, CEO of the Investment and Personal Finance Portal, Simple Investment.
Poblete also highlights the importance of evaluating risks and being well informed about how and where to invest.
On the other hand, mention that money saved at home is also a risk. “The uncertainty in the country brings with it the devaluation of the currency, which as a consequence brings inflation, which leads to the loss of that saved money,” he says.
Finally, the representative of Simple Investment recommends withdrawing the money only “if it is for an emergency, reducing debt, or investing it in something that will perform better than the current return or that at least beats inflation,” he noted.
Responsible use of the CTS account
“It takes a person six months on average to get into the job market, so it is important to know how to use the money you decide to withdraw. If you don’t make a good decision, you could be left unprotected ”, points out Inversión Simple.
“If this money is well used, good results will be obtained. If you choose to invest, you should know that the results will not be immediate ”, adds.
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