Le nkqubo yazisa ukufikelela okulinganiselweyo kwinxalenye yemali eyongiweyo, kodwa ayizange itshintshe izithintelo ekudala zikhona zokutsalwa kwemali ezisebenza kwii-akhawunti zomhlalaphantsi (ii-RA).
Even after fully depleting the savings component each year, a hypothetical member fares better in Alexforbes’ model than under its previous-system scenario.
While billions have been withdrawn through the two-pot system, Alexforbes says more members are remaining connected to retirement funds long after leaving their employers.
Data from Alexforbes and Sanlam suggests more members are preserving retirement savings, though it is too soon to know whether the shift will last.
The deputy adjudicator finds the ‘freeze’ clause the fund relied on is tied to its DB rules and can’t be used to block a DC member’s savings withdrawal.
The system appears to be changing member behaviour at exit from employment, even as most eligible members continue to make withdrawals.
IRFA also sets out how exit withdrawals now work when a member resigns and has already withdrawn from the savings component in the tax year.
The system introduced limited access to savings components, but it did not change the longstanding withdrawal restrictions applicable to RAs.
The Revenue Laws Amendment Act settles the treatment of provident and provident preservation fund members aged 55 or older on T-day.
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.
The retirement funds correctly refused multiple savings component withdrawals and early access to vested benefits.
The fund would be acting ultra vires if it paid a savings withdrawal while the member’s and employer’s contributions remained unpaid.
It is also open to discussions on letting members transfer all their vested savings into their retirement and savings components.
Many fund members are tapping into their savings components as soon as the tax window opens, data from the Actuarial Society indicates.
The Pension Funds Adjudicator rules the fund acted within the law when it refused a member’s request to dip into his FlexiPension plan.
Sanlam reports that most withdrawals came from financially strained members in mid-life, with little evidence that funds were used to reduce debt. Instead, spending patterns suggest pressure to cover everyday expenses.
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.
