The Two-Pot Retirement System
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Are paid up members included in the two-pot system?
Yes, paid-up members will be included in the two-pot system.
Why was the two-pot retirement system implemented?
Since only 6% of South Africans can retire comfortably, the two-pot retirement system was created to alleviate financial stress by introducing improvements to retirement savings preservation as it provides a level of flexibility to accessing retirement savings when emergencies arise.
What is the two-pot retirement system?
The two-pot retirement system allows you to access funds allocated in a savings component and a retirement component, referred to as “pots”. The savings component is intended for unexpected emergencies that would include family emergencies, medical emergencies, urgent home repairs, legal issues and natural disasters. The retirement component is an “untouchable” component specifically created for preservation until retirement.
Who is the two-pot retirement system meant for?
The new system will apply to all retirement funds, that is, both private sector and public sector funds except for legacy retirement annuity policies, or funds with no active participating members. Pensioners and members of provident funds who were 55 years and older on 1 March 2021 who have not opted to be part of the two-pot system will also be excluded.
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