Can I access the balance of my preservation fund before age 55?

Access to preservation funds has changed with the introduction of the two-pot system on 1 September 2024:

For existing preservation fund members (joined before 1 September 2024):

• Your existing balance as of 31 August 2024 will be placed in a "vested" component.
• 10% of this vested component (capped at R30,000) will be transferred to a new savings component.
• The remaining 90% (or more) will stay in the vested component.
• You can access the savings component once per tax year, subject to a minimum balance.
• The vested component remains preserved until retirement, except for any previously allowed withdrawal if not yet taken.

For new preservation fund members (joined on or after 1 September 2024):

• Your fund will be split into a savings component (1/3 of contributions) and a retirement component (2/3 of contributions).
• You can access the savings component once per tax year, subject to a minimum balance of R2,000.
• The retirement component remains preserved until retirement age.

Important notes:

• All withdrawals are subject to income tax at your marginal rate.
• Early withdrawals reduce your retirement savings significantly.
• Consider all options before withdrawing, as this impacts your long-term financial security.