Page 30 - Intra Muros September Issue 2024

FINANCE

THE NEW TWO-POT SYSTEM:

AN OPPORTUNITY TO CHECK IN

AND STEP UP

By Leani le Roux

rying to run a house, shoot the lights to know where, when and how they can funds, their ‘Savings Pot’, that this distressing
out at work and keep the lights (and access this money – and critically, whether trend will be reversed.
Twater) on at home? Adulting in they even have the funds to withdraw in the
the northern suburbs is not for the faint- first place,’ says Hayley Parry, co-founder of ‘What used to happen is that when
hearted. But there’s something else that’s Worth Financial Education. employees changed jobs, they’d get access
crying out for our attention and the reality to their entire retirement fund, and withdraw
is that it’s much needed - 96% of South It’s creating a sense of urgency for it,’ says Gary Kayle, CEO of Worth.
Africans will work their whole lives and not employers to proactively inform their
be able to afford to retire. employees about balancing short- This change is meeting the reality of South
term cash flow needs and longer-term Africa’s economic needs with the traditional
This dire statistic is one of the reasons for retirement planning. According to National retirement management landscape,
government implementing the new “Two- Treasury, more than 60% of retirement according to Gerald Mwandiambira, Certified
Pot” retirement system, which went live on fund members had accumulated pension Financial Planner and author. The access to
September 1 . And the bit that’s got most pots of less than R50,000 in 2020. And some (rather than all) of your money is a
st
people’s attention is that they can access the average fund member resets their great step towards taking real responsibility
R30,000 from their retirement funds once retirement savings balance to zero every for your financial future, he says. ‘But you
the new legislation kicked in. eight years. need to have a plan around how you’re going
to approach your savings withdrawal, and,
‘HR departments are going to be at the front It is hoped that by giving fund members critically, ‘make up’ the amount you’re taking
line when it comes to employees wanting access to a portion of their retirement away from your retirement pot.’

28 | INTRAMUROS SEPTEMBER 2024