Tal Gabay | Investment Portfolio Management

Investment & Savings Channels

Bank Investment Portfolio

A concentrated securities portfolio (stocks, bonds, etc.) managed in your name by a licensed portfolio manager.
Entry threshold: ~₪500,000 at most investment houses.
Location: In your bank account under a power of attorney, according to your desired risk level.

Self-Directed Trading

Opening an account with a brokerage member (bank or investment house) and executing trades independently.
Suitable for investors with knowledge and time to monitor and manage allocations.

Financial Savings Policy

An insurance-company product allowing investment of any amount with lump-sum or monthly deposits.
Liquidity: Fully accessible at any time.
Tax advantage: Switching tracks is not a taxable event — tax is paid only on withdrawal.
Most plans include non-tradable "income-producing assets" for improved returns.

Investment Provident Fund (Gemel Hashkaa)

2026 deposit ceiling: ₪83,641 per saver (can be opened for each family member).
Full liquidity at any time, no exit penalties.
Tax-exempt gains when withdrawn as a pension after age 60.

Amendment 190 Provident Fund

For ages 60+ — one of the most attractive instruments for managing liquid capital.
Reduced tax: 15% nominal only (vs. 25% real on other channels).
Pension: Completely tax-exempt when drawn as pension after age 60.

Amendment 190 Provident Fund — Full Details (2026)

Amendment 190 to the Income Tax Ordinance is designated for those aged 60+ and allows depositing free capital into a provident fund with tax benefits — at the time of deposit, at withdrawal, and on inheritance. As of 2026, it is one of the most attractive instruments for managing liquid capital.

✅ Advantages of Amendment 190

Reduced tax on gains (15% nominal): On lump-sum withdrawal after age 60, you pay 15% on nominal gain vs. 25% on real gain in other channels.
Tax-exempt monthly pension: Withdrawing funds as a pension after age 60 is completely exempt from income tax.
Tax deferral & flexibility: Switching investment tracks is not a taxable event — tax is deferred until actual withdrawal.
Inheritance tax benefits: If the account holder passes before age 75, heirs may withdraw tax-free or transfer to a fund in their own name.
Favourable loans: Borrow up to 80% of the balance at low interest without breaking the savings.
Access to non-tradable assets: Invest in real estate, infrastructure, and private funds for diversification and higher returns.

⚠️ Limitations & Conditions

Minimum pension prerequisite: For a lump-sum withdrawal you must demonstrate a minimum monthly pension of ~₪5,306 in 2026 (updated annually).
Partial liquidity before age 60: Early withdrawal before 60 incurs the full 25% tax on gains.
Annual deposit ceiling: ~₪38,412 in 2026 (with options to coordinate with the Tax Authority for higher amounts).
Market volatility exposure: Capital market investment carries volatility risk, especially in equity tracks.
Management fees: Vary between providers — check and compare carefully.

💡 Professional Perspective

"Tagging" deposits: Each deposit is split into a qualifying pension (up to ₪38,412) and a recognised pension (the remainder) — tax-capitalisation benefit is easier on the recognised portion.
Inter-generational transfer (above age 75): Heirs will pay 15% tax on gains — early tax planning recommended.
Tax authority coordination: A tax assessor approval is required for the first withdrawal after age 60.
Choosing an investment track: Due to the importance of tax deferral, align the track with the time horizon remaining until withdrawal.

Bottom line: A highly attractive product enabling significant tax planning advantages — for every person over age 60.

Considerations When Choosing the Right Channel

Liquidity: Most portfolios and policies allow withdrawal within days, but market volatility should be taken into account.
Taxation: Capital gains tax is generally 25% on real gain, versus 15% nominal in an Amendment 190 provident fund.
Management fees: Portfolio management — fixed management fees and buy/sell commissions; savings policies — management fees on the balance only.
Risk diversification: It is advisable to combine channels (equities, bonds, real estate, etc.) to reduce risk.