BL Premium reports that more than half of those who took part in the latest annual Sanlam benchmark survey are opposed to the Treasury’s proposal to give individuals limited access to their retirement savings before retirement via the so-called two-pot system.
The proposal seeks to strike the right balance in helping members save for retirement while being flexible enough to accommodate them when they have fallen on hard times. This is just one of many findings in the 2022 survey, which polled 83 principal officers of stand-alone funds, 100 participating employers in umbrella funds, 15 asset consultants, 15 healthcare consultants, six top umbrella fund sponsors and 500 online consumers. “Those in the [retirement] industry do not believe that implementing the two-pot system by March 2023 is realistic, as it involves ‘an enormous amount of work’,” Sanlam said in a release on Tuesday. Just more than half of the members who took the poll were aware of the two-pot system but 56% said they did not agree with it, with 29% saying if the law were changed they would “definitely not” access their retirement funds early, with 20% saying they “probably” would not. The Treasury proposal includes one accessible pot comprising one-third of contributions from which withdrawals could be made before retirement and a two-thirds preservation pot that would be kept intact until retirement. The researchers also found that 55% of retirement fund members have experienced reduced household income due to Covid-19, which has claimed as many as 2-million jobs over the past two years in SA. In the research, they highlighted that income reduced in more than 55% of SA households and more than 16% were affected by retrenchments. Nearly 10% were forced to take unpaid leave or sabbaticals. In 7% there were deaths with loss of income.
- Read the full original of the report in the above regard by Andries Mahlangu at BusinessLive (subscriber access only)
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