She was reacting to the Pension Fund Amendment Bill that was signed into law by President Cyril Ramaphosa this month.

The law now implements the “Two Pot” retirement system, which means one-third of retirement contributions will be split into a savings component and two-thirds into a retirement component.

This will enable members of retirement funds to access their savings without having to resign.

Workers in good standing can withdraw up to R30 000 of their pension fund savings with the minimum being R2 000.

Govender says while this could help as an immediate financial buffer, it will have a negative impact on one’s overall retirement payout.

“I know that people are eagerly awaiting this and yes, while it would make a difference to their lives, my fear is that people who don’t need it are going to withdraw that 30k. I think the best advice we can give is that please don’t be tempted to withdraw it if you don’t need it,” she adds.


--SABC--