Two-pot’s hidden effect: members are staying in retirement funds
While billions have been withdrawn through the two-pot system, Alexforbes says more members are remaining connected to retirement funds long after leaving their employers.
#retirementcomponent
More early signs that the two-pot system is working
Data from Alexforbes and Sanlam suggests more members are preserving retirement savings, though it is too soon to know whether the shift will last.
Old Mutual sees rise in retirement savings preservation under two-pot system
The system appears to be changing member behaviour at exit from employment, even as most eligible members continue to make withdrawals.
Budget’s retirement threshold changes in effect despite legislative omission
IRFA also sets out how exit withdrawals now work when a member resigns and has already withdrawn from the savings component in the tax year.
Two-pot reform does not unlock vested RA benefits – Tribunal
The system introduced limited access to savings components, but it did not change the longstanding withdrawal restrictions applicable to RAs.
Three years that matter: emigration and access to retirement funds
The three-year countdown starts only when SARS formally recognises you as a non-resident – a difference of months can affect access and tax outcomes.
Adjudicator’s rulings highlight ongoing confusion over two-pot withdrawals
The retirement funds correctly refused multiple savings component withdrawals and early access to vested benefits.
Treasury favours conditional access to retirement pot for retrenched workers
It is also open to discussions on letting members transfer all their vested savings into their retirement and savings components.
Three-quarters of withdrawals in the new tax year are repeat claims
Many fund members are tapping into their savings components as soon as the tax window opens, data from the Actuarial Society indicates.
Retirement pot withdrawals could undermine long-term savings
Danie van Zyl of Sanlam Corporate Investments warns that allowing access to retirement components in retrenchment cases might jeopardise long-term savings and place added pressure on trustees.
Members need advice to navigate two-pot’s complex options
The two-pot system demands members make choices for vested, savings, and retirement components – all with distinct rules and tax implications. This complexity is driving the need for personalised advice and the systemic changes to support members effectively.
FSCA wants to know how much two-pot withdrawals are costing members
The Authority is seeking information on how much it costs retirement funds and administrators to adapt their systems for the new two-pot structure.
Cosatu wants urgent discussions with Treasury over changes to two-pot system
One of its four proposals is to allow members to transfer up to a third of their vested savings to their savings component.
Two-pot system is about compulsory preservation
South Africa has the potential to boost its savings rate and secure a more stable source of funding for fixed investments, essential for driving economic growth.
Final legacy RA exemption conditions published
Commentators did not raise any significant concerns in their responses to the draft conditions, the FSCA says.
FSCA publishes ‘two pots’ guidance for defined-benefit funds
If a fund cannot follow the standard allocation methods, it must apply for FSCA approval to use an alternative, reasonable method.
‘Two-pot system will produce better outcomes for those who avoid the risks’
The type of fund to which a member belongs may improve or undermine the preservation of retirement fund assets, says Allan Gray.
