This is according to the FNB Retirement Insights Survey 2024. More concerning is that the number of South Africans without retirement plans is increasing, particularly among the middle and lower-income earners.

The high cost of living and elevated interest rates are some of the reasons South Africans say hamper their retirement.

The FNB survey found that only 50% of respondents have a retirement plan in place.

FNB Wealth and Investment Product Head, Samkelo Zwane, says the survey found that when it comes to planning for retirement, income levels play a significant role, with lower income individuals facing more challenges planning for their retirement.

“What’s happening is basic goods and services are taking up a lot of their income. That’s basically what’s happening here. Only 2% of their income is left to put towards retirement savings and, when you look at the upper income earners, only 12% is left towards actually saving for retirement.”

The survey also found that only 25% of respondents who have retirement funds are not on track with their retirement goals.

Zwane explains, “The 25% that are not on track to meet their retirement goals site economic factors or macro factors as being involved. That is economic factors, inflation and cost-of-living, emergency and unplanned events coming out strongly as well as time in the market and procrastination.”

Stats SA figures show that more employers prefer to hire staff on a contract basis. A number of companies are now structuring salaries in a way that places the onus on workers to find their own retirement plans.

Often employees choose to pocket the money. FNB says less than 10% of South Africans will be able to retire comfortably.

The survey found that many people in retirement still rely on their children, while some are still servicing debt.

--SABC--