One-month on from the introduction of the South African two-pot retirement system, and billions of Rands have been withdrawn. Here’s why …
had financial experts worried. Primarily due to the ‘two-pot’ naming convention – one pot for saving and one pot for withdrawal – billions has flowed out of peoples’ retirement planning, because that’s what the pot is meant for. AndThe system allows liquidity in the short term, while still protecting two-thirds of savings for the future. Image: FileAs a reminder, the South African two-pot retirement system divides retirement contributions into three components.
Basically, withdrawing from your retirement savings should be a last resort. Many people are unaware of the long-term consequences of withdrawing, including the tax implications which will significantly reduce your return on withdrawal anyway. With improved communication and education, financial services companies hope to change the mindset of those wanting to withdraw early.
Discovery reports it is seeing different withdrawal behaviours from different income groups. For instance, 40% of low-income earners, earning less than R120 000 annually , are withdrawing. Meanwhile, only 4% of high-income groups, earning beyond over R1-million per year, have withdrawn. Don’t miss Tuesday, 8 October’s riveting episode of South African soapie Uzalo on SABC 1 on DStv channel 191.
Malaysia Latest News, Malaysia Headlines
Similar News:You can also read news stories similar to this one that we have collected from other news sources.
Heritage Month: South African music legends celebrated by their peersHeritage Month: South African music legends celebrated by their peers
Read more »
Six South African travel creators to follow this Tourism MonthFollow these six South African travel creators for inspiration during Tourism Month to explore the beauty of South Africa through their eyes.
Read more »
Think local and regional to sustain scaling South African enterprise growthThe SADC offers potential for growth across various sectors by leveraging South Africa’s strengths in agriculture, energy, manufacturing and digital services
Read more »
South African defence industry open for business - SABC News - Breaking news, special reports, world,South Africa’s state-owned defence company, Denel, say it is open for business. The company used Africa Aerospace and Defence (AAD) 2024 to clearly
Read more »
Former South African Finance Minister Pravin Gordhan Dies at 75Pravin Gordhan, a prominent figure in South Africa's struggle against apartheid and later a key minister during the country's transition to democracy, has passed away at the age of 75. Gordhan died peacefully in hospital surrounded by family and friends after a recent cancer diagnosis.
Read more »
MAJOR South African bank will offer stokvels by 2025A major South African bank will offer stokvels from next year onwards, continuing to grow its grassroots savings base. Here’s more …
Read more »