# Everything You Wanted to Know About Kupat Gemel for Investment

> A comprehensive guide to Kupat Gemel for Investment – a savings channel that works for both the short term and retirement.

- Canonical URL: https://www.shavve.io/en/articles/kupat-gemel-investment-guide
- Category: Savings & investing
- Published: 2023-05-15 · Updated: 2026-10-25
- Reading time: 7 min
- Language: English
- Shavve - שווה — https://www.shavve.io/en

## The short version

- A savings channel that works for both the short term and retirement.
- You can withdraw the money whenever you want – without a penalty.
- If you keep it until retirement age and take it as an annuity, you can be exempt from capital gains tax, subject to the law's conditions.
- A personal investment track that fits your risk level – and fees are worth checking.

Kupat Gemel for Investment is a simple way to invest in the capital market without managing a portfolio yourself. Here is what matters: how it works, who it suits, the pros and cons, and what to check.

## What is Kupat Gemel for Investment?

It is a type of savings that lets you invest in the capital market – simply. **You choose** how much to deposit and how to invest (general, stocks, conservative and so on), and **the investment manager does the work**.

1. **Choose a provider and a track** — Compare providers by management fees and returns over time, and pick a track that fits your horizon and risk level.
2. **Deposit** — You can deposit a lump sum or a monthly standing order, up to the yearly ceiling set by law.
3. **Decide when to withdraw** — You can withdraw whenever you like, or wait until retirement age and receive the money as an annuity.

## Who is it suitable for?

Almost everyone – young savers, parents saving for their children, and people nearing retirement. It is **very flexible** savings: you decide how much to deposit, and later what to do with it. Check the current yearly deposit ceiling on the Capital Market Authority site.

In long-term saving, time works for you. Play with the numbers and see how much of the final amount comes from growth:

*Compounding: what happens when you let time work (on the website: an interactive calculator)*

Have a goal – an apartment, a car, studies? You can estimate roughly how much to deposit each month:

*How much to save each month to reach a goal? (on the website: an interactive calculator)*

## What are the advantages?

- **Liquidity** – you can withdraw whenever you want.
- **Long-term tax benefit** – if you wait until retirement age and take the money as an annuity, you can be exempt from capital gains tax, subject to the law's conditions.
- **Simplicity** – one product, one track you choose, and an investment manager who handles the rest.

> **Key point**
> The biggest advantage: it is liquid. You can withdraw whenever you want – and if you wait until retirement age and receive the money as an annuity, there is a significant tax benefit.

## What are the disadvantages?

There is a limit on how much you can deposit each year. And as long as the money is not withdrawn as an annuity, you pay regular capital gains tax (25%) like any other investment.

*Two ways to withdraw – in broad strokes*

| How you withdraw | When | Tax on the profits |
| --- | --- | --- |
| As a lump sum | Any time | Regular capital gains tax (25%) |
| As an annuity at retirement age | From retirement age | Exempt from capital gains tax, per the law's conditions |

> **Note**
> The exact details (age, annuity conditions, ceilings) change. Before deciding, check with the provider or the Capital Market Authority site.

### What does saving in an investment provident fund look like over time?

- **Step 1** — Set a goal and a horizon: An apartment in five years or retirement in twenty-five – it shapes the track.
- **Step 2** — Choose a track and deposit: You can start small and increase over time.
- **Step 3** — The money grows and stays liquid: You can withdraw at any point, but check the tax consequences first.
- **Step 4** — Retirement: Withdrawing as an annuity at the eligible age can allow a tax benefit, subject to the rules.

## So what's the bottom line?

Kupat Gemel for Investment is a smart, simple and convenient product. It combines the flexibility of liquid savings with tax benefits for long-term savers. Just choose a track that suits you – and remember to check the management fees.

**Before you deposit**

- [ ] What is the goal and horizon for this money
- [ ] Which track am I in, and how risky is it
- [ ] What are the fees, and how do they compare with other funds
- [ ] Do I have an automatic monthly deposit
- [ ] What is the current yearly deposit ceiling

## How to compare investment provident funds

Funds differ in ways that can be measured, and they are checked before opening. The public data is gathered on the Capital Market Authority's [Gemel Net](https://gemelnet.cma.gov.il/) site, and lets you compare return, fees and assets under management between funds and between tracks. To keep the comparison fair, compare similar tracks only.

| What to compare | Why it matters | Note |
| --- | --- | --- |
| Management fees | They affect the final amount every year | Ceiling: up to 4% of deposits and 1.05% a year of the balance, according to Kol Zchut |
| Investment track | It sets the level of risk | An equity track is not like a conservative one |
| Return over time | Shows how the track behaved, not what will happen | Compare long periods and not a single year |
| Service and convenience | Interface, statements, availability | Matters to someone who contacts the provider often |
| Withdrawal terms | The withdrawal process and costs | Check before you open |

## Common uses

- A medium-term goal where access to the money matters, such as a purchase or a renovation.
- A top-up to pension saving for someone who wants flexibility.
- Separate saving for children or a family goal, managed apart from the current account.
- A further channel for someone who has already used up the study fund.

## Withdrawal: what to know

In an investment provident fund you can withdraw at any time, but in most cases the tax rules on the gain will apply. At retirement age and in certain conditions there are reliefs, set out on the authority's site. Before withdrawing, ask the provider for a calculation of the tax and the net amount, and check whether a partial withdrawal is better. The aim is not to find out the details after the money has already gone.

For a comparison of an investment provident fund and a study fund, see [Study fund, provident fund or regular saving](https://www.shavve.io/en/articles/hishtalmut-vs-savings), and for lowering costs see [How to lower management fees](https://www.shavve.io/en/articles/how-to-lower-management-fees).

## How to open one, step by step

1. **Define a goal and a horizon** — What you are saving for and when you may need the money.
2. **Compare on Gemel Net** — Compare fees, tracks and return over time across several funds.
3. **Choose a track** — By the horizon and the risk you are comfortable with, not only by past return.
4. **Ask for the withdrawal terms** — Check the process and the costs in advance, and get them in writing.
5. **Set a regular deposit** — A monthly standing order builds the habit and removes the need to decide each time.

## Three examples of use

| Situation | Why a provident fund | What to watch |
| --- | --- | --- |
| Saving for a renovation in three years | Access at any time, with no waiting | Tax on the gain at withdrawal |
| No employer deposits into a study fund | A savings channel that does not depend on an employer | Fees compared with a study fund |
| Saving for a child | Managed apart from the current account | Check the withdrawal terms |

## Common mistakes

- Choosing a fund by one year's return.
- Comparing different tracks and concluding one fund is expensive.
- Not checking tax before withdrawing.
- Opening several small funds and forgetting them, each with its own fee.

## How to read the fund's statement

| Field in the statement | What it says | What to check |
| --- | --- | --- |
| Balance | The amount accumulated in the fund | That it matches deposits and return |
| Deposits | The amounts that came in during the period | That no deposit is missing |
| Management fees | A rate on deposits and on the balance | Against the ceiling and other funds |
| Track | How the money is invested | That it matches the goal and the horizon |
| Return | The change in the value of the money over the period | Over time and against similar tracks |

## Merging funds

Someone who opened several funds over the years pays each one's own fee. Merging similar funds can cut costs and simplify tracking, but first check the terms of the transfer, including tax and any special terms that apply to each fund. Get the exact details from the provider and the authority.

## Types of track: conservative, general and equity

| Track type | Nature of the investment | Who it suits |
| --- | --- | --- |
| Conservative | Emphasis on bonds and deposits, with low exposure to equities | A short horizon, or someone who does not want volatility |
| General | A mix of equities and bonds | A medium horizon, a balance of risk and return |
| Equity | High exposure to equities | A long horizon and the ability to withstand volatility |

These are general definitions. In practice each provider and track has its own rules and composition, so check the detail on Gemel Net and in the fund's documents, not only by the name.

## A fixed monthly deposit: what it gives and what it does not

A regular deposit is a convenient habit, but it is important to understand what it gives:

- It creates discipline: the money moves before you reach the spending.
- It spreads your entry points into the market: part of the money goes in on good days and part on bad days. This does not guarantee a return and does not protect against loss.
- It does not replace checking the fee and the track, and both keep affecting every deposit.

A simple illustration: depositing ₪1,000 a month for 10 years is ₪120,000 of deposits, before gains and losses and before fees. What it becomes in practice depends on returns and costs. So run several scenarios in the [compound-interest calculator](https://www.shavve.io/en/tools/compound-interest-calculator), including a bad one, instead of leaning on a single scenario.

And if you change the amount or stop depositing for a while, write it into the plan. The decision should be deliberate, not the result of a standing order nobody remembered to update.

**Can I withdraw at any time?**
Yes, whenever you want. If you withdraw a lump sum you pay capital gains tax on the profit. The full benefit is reserved for those who withdraw as an annuity at retirement age.

**How is it different from a Keren Hishtalmut?**
A Keren Hishtalmut is meant for the medium term and its benefit arrives after about 6 years. A Kupat Gemel for Investment also suits the short term, and its full benefit is tied to withdrawing as an annuity at retirement age.

**How do I choose a track?**
By horizon and risk level: a long horizon usually allows more risk, and closer to retirement people tend to move to a steadier track. Review it every few years.

**What is the fee ceiling in an investment provident fund?**
Up to 4% of each deposit and up to 1.05% a year of the balance, according to Kol Zchut. It is a maximum, and the provider may charge less. Verify on the authority's site.

**Where can I compare investment provident funds?**
On the Capital Market Authority's Gemel Net site, which lets you compare return, fees and assets under management between funds and tracks.

**Should I merge several investment provident funds?**
Sometimes: merging similar funds cuts duplicate fees and simplifies tracking. First check the transfer terms and tax with the provider.

**All your savings in one place** Shavve brings pension, funds and provident funds together – so you can see everything and know where to check the fees.

## Sources

- [gov.il – Capital Market Authority](https://www.gov.il)
- [Gemel Net: provident and study fund data from the Capital Market Authority](https://gemelnet.cma.gov.il/)
- [Kol Zchut: no management fees above the ceiling in an investment provident fund](https://www.kolzchut.org.il/he/%D7%90%D7%99%D7%A1%D7%95%D7%A8_%D7%92%D7%91%D7%99%D7%99%D7%AA_%D7%93%D7%9E%D7%99_%D7%A0%D7%99%D7%94%D7%95%D7%9C_%D7%91%D7%A7%D7%95%D7%A4%D7%AA_%D7%92%D7%9E%D7%9C_%D7%9C%D7%94%D7%A9%D7%A7%D7%A2%D7%94_%D7%9E%D7%A2%D7%9C_%D7%94%D7%AA%D7%A7%D7%A8%D7%94_%D7%94%D7%9E%D7%A7%D7%A1%D7%99%D7%9E%D7%9C%D7%99%D7%AA)
- [Kol Zchut: management fees in an investment provident fund](https://www.kolzchut.org.il/he/%D7%93%D7%9E%D7%99_%D7%A0%D7%99%D7%94%D7%95%D7%9C_%D7%91%D7%A7%D7%95%D7%A4%D7%AA_%D7%92%D7%9E%D7%9C_%D7%9C%D7%94%D7%A9%D7%A7%D7%A2%D7%94)
- [Capital Market, Insurance and Savings Authority (gov.il)](https://www.gov.il/he/departments/capital_market_insurance_and_savings_authority)