For many South Africans, debt and retirement saving compete for the same income.
Household debt stood at 62.2% of disposable income in the first quarter of 2026, according to the South African Reserve Bank. At the other end of the financial equation, only about 6% of economically active South Africans are estimated to be able to retire comfortably.
The tension between debt repayment and retirement saving has prompted the industry to explore new approaches. Debt Reset, launched by Discovery Corporate and Employee Benefits on 1 August, is one example. The once-off benefit is available to eligible members of participating employers with Discovery retirement funds.
How Debt Reset works
Members can pause their retirement contributions for up to 12 months and redirect that income towards qualifying short-term unsecured debt.
Before they can do so, they must complete a four-hour, self-paced financial education course provided by Worth, complete a budgeting exercise, and attend a financial coaching session. They must then demonstrate for three months that their unsecured debt remains stable and commit to using the additional income generated through the programme to reduce qualifying short-term unsecured debt.
Guy Chennells, chief commercial officer at Discovery Corporate and Employee Benefits, says: “We know that lasting financial recovery rarely comes from a single intervention. Debt Reset combines financial education, coaching, behaviour change, and practical financial support.”
During the contribution-relief period, Discovery says eligible members could have up to R25 000 in additional income available for debt reduction, depending on their contribution level and eligibility. Discovery monitors their progress to ensure debt balances are reducing.
Once the member has successfully completed the programme and resumes retirement contributions, Discovery provides a retirement boost of the contributions that were redirected towards debt repayment.
“This ensures their long-term retirement savings trajectory.”
Why link debt and retirement saving?
The proposition comes as the two-pot retirement system, introduced in September 2024, has given South Africans greater flexibility to access a portion of their retirement savings before retirement. Discovery says some employees use retirement savings to deal with debt or emergencies, while others resign to access accumulated retirement savings.
Chennells says: “Too many employees feel forced into short-term decisions that compromise their long-term financial future. Whether it is withdrawing retirement savings, taking on more expensive debt or leaving employment to access savings, these choices often solve an immediate problem while creating a bigger one later.”
Understanding debt
Discovery has also developed a Debt Reset Calculator to help users estimate how much debt they could repay during the contribution-relief period, how long repayment could take, and how the Boost could affect their retirement savings.
Chennells says the calculator is intended to give users a clearer view of their debt and the potential effect of redirecting contributions towards repayment.
“The first step towards addressing debt is understanding it.”
The calculator is available to anyone, while the Debt Reset benefit is restricted to eligible members of participating employers with Discovery retirement funds.
