September 2024
13Sep

South Africa. Over 63,000 government employees dip into their two-pot retirement funds, says GPAA

The Government Pensions Administration Agency (GPAA) has confirmed that that more than 60,000 public sector employees have made applications to make withdrawals from their savings pot of the two-pot retirement system. According to the GPAA, the Government Employees Pension Fund (GEFP) has received a little under 63,000 two-pot retirement system applications since September 1, 2024. In terms of two-pot retirement system enquiries, the GPAA said it has received a high number of applications from its members, which include teachers, nurses, police officers and other...

September 13, 2024
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August 2024
21Aug

South Africa. Two-pot retirement system: fewer early withdrawals, more financial optimism

While many South Africans who are members of pension funds are counting the days until they can withdraw from their savings pot under the two-pot retirement system, research suggests that fewer people plan to dip into their retirement savings early, probably thanks to financial optimism as the economy improves. According to the 2024 Old Mutual Savings and Investment Monitor that took a deep dive into the two-pot retirement system, the number of working South Africans with retirement savings provision (income...

August 21, 2024
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16Aug

South Africa. Should government use pensions to fund it projects?

Government forcing pension funds to invest in its projects have long been a discussion in South Africa and the ANC promised to implement it after the elections to pay for economic development and industrialisation. Dr David Masondo, deputy minister of finance, said at an Old Mutual event on Tuesday that government is committed to respect the investment mandates of pension funds to increase investment turnover based on acceptable risk. Then he referred to Regulation 28 of the the Pension Funds Act that...

August 16, 2024
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06Aug

South Africa’s two-pot retirement threat

South Africa has a dismal savings rate, with more money flowing out of retirement vehicles than being put in—and the Reserve Bank warns there is a slight chance the new two-pot retirement system will exacerbate the problem. According to the latest 10X Investments Retirement Reality Report 2023, only 6% of South Africans are on track to retire comfortably. A comfortable retirement means being able to afford 70% of your pre-retirement income during retirement. The report is based on findings from the 2023...

August 6, 2024
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July 2024
22Jul

South Africa. Key two-pot bill signed into law

President Cyril Ramaphosa has signed into law the Pension Funds Amendment Bill that is key for the implementation of the two-pot retirement system, which takes effect on September 1. The signature into law of the bill gives legal certainty to the retirement industry, which has been implementing the necessary changes. The new system will provide members of retirement funds with the ability to access part of their retirement savings without having to resign or cash out their pension funds. The new...

July 22, 2024
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04Jul

South Africa. Pension fund members hope to pay off debt from two-pot retirement withdrawals

Pension fund members hope to pay off some debts from their two-pot retirement system withdrawals as financial pressures force 50% of consumers to cash in their retirement funds in an environment where even high-income consumers are failing to pay their home loans. And if they use money from Peter to pay Paul, they will also have to pay the tax man. According to Sanlam Benchmark research that will be revealed next week, Sanlam found in 2022 that just 31% of...

July 4, 2024
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June 2024
25Jun

South Africa. Cosatu works with stakeholders on two-pot system implementation

The Congress of South Africa’s Trade Unions (Cosatu) General Secretary, Solly Phetoe says the affiliation is working with the National Treasury, the Financial Sector Conduct Authority (FSCA) and pension funds at Nedlac to ensure a smooth implementation of the two-pot system on September 1. The two-pot retirement system is confirmed to rollout on September 1 when workers will be able to access 10% or up to R30 000 of their existing pension funds. Phetoe says Cosatu condemns anyone that spreading misinformation...

June 25, 2024
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13Jun

South Africa. Government pension fund systems offline for months after ransomware attack

The Government Employees Pension Fund (GEPF) suffered a cyberattack in February 2024, and it only expects to restore its self-service functionality by 21 June 2024. A notice published on the GEPF’s social media pages says the self-service functionality on its web platform and app was still offline due to the data breach at the Government Pensions Administration Agency (GPAA). “The GPAA has determined that a total rebuild of the platforms is necessary to ensure a stronger platform,” it said. It is expected...

June 13, 2024
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12Jun

South Africa. Two Pot Retirement System

What is a two-pot retirement? The two-pot retirement system is a reform that will allow retirement fund members to make partial withdrawals from their retirement funds before retirement, while preserving a portion that can only be accessed at retirement to help improve retirement outcomes. This means members need not resign to access part of their retirement benefit if they are in financial distress. This reform will come into effect on 1 September 2024. Who is it meant for? The new system will...

June 12, 2024
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May 2024
20May

South Africa. New law enables pension fund members to access their savings

Pension fund members are set to access a third of their pensions within the next four months. The National Assembly unanimously approved the Pension Fund Amendment Bill after it was sent back for concurrence by the National Council of Provinces (NCOP) with technical amendments. The bill, introduced by Finance Minister Enoch Godongwana in January, provides for a “two-pots” system that divides pension contributions into two separate pots: a savings pot and a retirement pot, with effect from September. It proposes that retirement...

May 20, 2024
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