Other financial matters

Get the most out of your retirement fund and your savings

Decisions that help you make the most of your retirement savings

Save more whenever you can

Have you thought about how long you'll live after you retire?

One way to estimate this is to think about how long your oldest grandparent or great-grand parent lived and assume that, with recent developments in medicine, you have a good chance of living even longer than they did.

Did you know that a 60-year-old living today has a good chance of living to 90 or more?

What you can do to have enough to live on when you retire from your employer

Make sure you’re saving enough every month

Tip!
Add to your retirement savings and increase the amount you’re saving whenever you can, like when you get a pay increase.

Find out more

Keep your retirement savings invested whenever you change jobs

Important: if you’ve been retrenched or are struggling financially after leaving your employer and are thinking about withdrawing your retirement savings in cash, it’s a good idea to speak to a qualified financial adviser. They can help you draw up a financial plan that helps you through your financial challenges and can also help you keep your retirement savings invested for your future self.

Find out more


To help you decide, find out more about your options

  • Watch this video to help you decide, or
  • Read this brochure to help you decide.

If you’d like to keep your retirement savings invested for your future self to reduce the risk of not having enough to live on after you retire, these are your options.


Tip!
Keep your retirement savings invested for their real purpose - to provide you with income when you're no longer working. Avoid withdrawing cash from your savings when you change jobs.

It’s important to understand your retirement fund and your employer’s fund benefits

Your member booklet or benefit schedule has the details of the benefits and options that are specific to your employer or fund, including the following information:

  • Available investment portfolios
  • Percentages you can choose from to save for retirement every month (contribution rates)
  • Available insurance benefits
  • How to increase the amount you’re saving towards retirement or how to add to your retirement

You can get your member booklet from your human resources department.

Important things you can do today to improve your financial health

READ

to find out more about the importance of having a will and keeping your beneficiary nomination form updated.

WATCH

this video about the importance of balancing your needs now with your future goals and getting the right support to help you do this.

Being informed and knowing if you’re on track to meet your retirement savings goals are important steps you can take to improve your financial picture.

Explore your retirement picture in 7 fun steps.

My Retirement Picture

More about My Retirement Picture

  • In My Retirement Picture you can find out:
    • What pension you can expect when you retire.
    • If you will have enough to live on after you retire from your job.
    • Ways you can improve your retirement picture.
  • Who is My Retirement Picture for?
    • It’s for anybody at any age.
  • How much does it cost?
    • It doesn’t cost anything. Anybody can use it.
  • Build your personal retirement picture using this exciting new interactive and gamified tool.
  • Watch the introductory video about My Retirement Picture to find out more before you get started.
  • Give us feedback on My Retirement Picture.

EXPLORE MORE ABOUT DAY-TO-DAY FINANCIAL MATTERS

Saving for emergencies

Saving for emergencies

If you had an emergency, would you have enough savings?

Find out more about being prepared for emergencies.

Reducing expenses

Reducing Expenses

Did you know that people who have a budget and stick to it have a better chance of reaching their goals?

Find out more about how to reduce your expenses and get started with a budget.

Being prepared

Being prepared

If the unexpected happened, like death or disability, would your financial needs or your family’s financial needs be taken care of?

Find out more on the ways you can be prepared.

Managing debt

Having more debt than you can afford can be stressful. If you’d like to have more control over your finances, read more here.

  • Read more about the difference between good debt and bad debt here.
  • Unplanned expenses sometimes lead to borrowing money even when you don’t want to. Find out more about being more financially prepared for emergencies here.
  • Find out more about being on top of your debt here.

Reaching your goals

Reaching your goals

Saving for goals means:

  • having a plan
  • managing priorities
  • getting your loved ones to help you stay on track with your plan

Watch this webinar about managing money to support you along the way to reaching your goals.

GET HELP! Speak to a licensed financial adviser on
0860 000 381 or email mymoneymatters@alexforbes.com

Health challenges

Health challenges

These days we’re often thinking about health. Are you prepared for health challenges?

Find out more about how to choose the right medical aid for your budget.

Investing for a goal

Whether you are saving for a goal,
diversifying your investment portfolio or bolstering your savings,
a unit trust (or collective investment scheme) can help you to reach your target.

Read more

Other useful information about your retirement fund

  • What’s a retirement fund?

    When you’re no longer earning a salary at the end of your working life, you can use your savings in your retirement fund to buy a pension that will give you regular income. Your employer has provided you with a provident or pension fund.

    How does a retirement fund work?

    • Every month, you, your employer or both make contributions to your fund.
    • These contributions are saved towards your retirement. You can use your retirement savings to buy a pension that will give you a regular income in retirement.

    How much your pension will be depends on:

    • how much you or your employer contribute during your working life
    • how investments have performed
    • whether you keep your retirement savings invested instead of taking them in cash when you change jobs
    • the cost of buying a pension when you retire
  • A benefit statement shows:

    • how much you’ve saved so far for retirement
    • the pension you can expect based on the information we have about you

    Here’s an explanation of your benefit statement.

    View your benefit statement by logging onto the Alexforbes website or by downloading the AF app on the Apple App Site or the Google Play Store.

  • The rules of your fund will tell you if you can make extra contributions to your retirement savings in addition to your monthly contributions. These are called ‘additional voluntary contributions’. It is very important to contribute as much as you can every month.

  • You can choose a contribution amount from the options that are provided in the rules of your fund. It is very important to contribute as much as you can every month. You can find out more about your contribution options in your member booklet (which you can get from your HR department).

  • If your fund offers more than one contribution option, then you can usually change the amount you are contributing to retirement once a year or more often, depending on your retirement fund rules. You can ask your HR department more about this option. Contributing more will give you a better chance of having enough to live on when you retire from your employer.

  • You can choose a contribution amount from the options that are provided in the rules of your fund. It is very important to contribute as much as you can every month. You can find out more about your contribution options in your member booklet (which you can get from your HR department).

  • Your employer might contribute an amount based on your pensionable salary, depending on the rules of your fund. Your pensionable salary (or fund salary) is the part of your salary that your retirement savings contributions are based on.

  • Yes. The costs of running and administering the retirement fund are taken from contributions. You can find the details of these costs in your member booklet.

  • If you’re a member of a defined benefit fund, investment performance doesn’t directly affect your retirement fund savings.

    Most members belong to defined contribution funds. In a defined contribution fund, the value of investments in your retirement fund’s investment portfolios do affect your retirement savings.

    Find out which type of fund you belong to by asking your HR representative or logging onto our website to check your statement.

    There are two main things that affect the value of an investment portfolio:

    1. Conditions in investment markets
      • Over shorter periods of time – days, weeks, months and sometimes even years, investments can decrease in value. Sometimes different types of investments all decrease in value at the same time.
      • Over longer periods of time, we expect the investments in your retirement savings portfolio to increase in value.
    2. How well the investment managers do
      • Alexforbes Investments chooses the investment managers that manage the money in your investment portfolio.
      • We choose the investment managers very carefully to make sure that they manage the money in retirement savings portfolios responsibly and professionally. We monitor these investment managers on an ongoing basis.
      • We also choose a mix of managers who we think will give your retirement portfolios the best chance of growing more than other portfolios.
      • Over shorter periods of time, retirement savings portfolios may not do as well as other portfolios. This is because we choose and mix investment managers based on what we believe, based on our research, will be best over longer periods of time.
    • A single investment manager is a manager of investments (asset classes).
    • A multi-manager is a manager of investment managers.

    Multi-managers don’t actually buy and sell asset classes, but rather manage the investment managers, who do this on their behalf. Ultimately, multi-managers blend the best assets to give the most appropriate investment management solution. To achieve this they:

    • Assess a fund’s investment needs.
    • Match these investment needs with a combination of single managers to meet them.
    • Monitor the investment managers to make sure they deliver the required performance.

    A good multi-manager combines the services of selected single managers based on their proven ability in individual areas of expertise, depending on the fund’s particular investment requirements.

  • Knowing if you’re on track is an important first step to reaching your goals. Use our fun gamified tool to build your retirement picture and find out if you’re on track and what you can do if you’re not on track.

  • If you decide to withdraw, rather than preserve your retirement savings, this is how you’ll be taxed: During your lifetime, you can take a total of R500 000 of your retirement savings tax free on retirement. However, all amounts you withdraw in cash (exceeding R25 000) before retirement will reduce this amount. How much you are taxed depends on how much you take and when you take it.

    SARS sets the amount of tax you pay on any amount you withdraw. This can change from time to time. The latest information is available on SARS’ website. A financial adviser can help you work out how much tax you may need to pay if you plan on withdrawing any of your retirement savings in cash when you leave your job.

  • If you decide to withdraw any of your retirement savings in cash if you are retrenched, you may have to pay tax. SARS sets the amount of tax you pay on any amount you withdraw, depending on how your employer has classified your retrenchment. The rate of tax you must pay changes from time to time. This information is available on SARS’ website. A financial adviser can help you work out how much tax you may need to pay if you plan on withdrawing any of your retirement savings in cash when you have been retrenched.

    It is especially important to have the support of a financial adviser if you have been retrenched, especially if you don’t find another job straight away or think you’ll struggle to cope financially. A financial adviser can help you make the most of what you have and try to keep as much of your retirement savings invested for your future self at the same time.

  • My retirement savings will stay invested so that they can carry on growing.

    It is very important for you to keep your contact and other details up to date with Alexforbes so that you can keep receiving information about your retirement savings.

    Please get in touch with the Client Contact Centre to update your details.

  • If you’re closer to retirement, make contact with a financial adviser as soon as you can. We recommend that you start discussing your retirement plans with a financial adviser at least five years before your fund's normal retirement date.

  • The amount of money you need to save for retirement will depend on what your expenses will be during retirement. Generally, you should try to save enough money to cover your monthly expenses for as long as you or your spouse, if you have one, expect to live after you retire. It’s important to keep in mind that people often live much longer than they think they will, after they retire.

    One way to figure out what your expenses will be and whether you’ve saved enough to cover those expenses is to work through the guided journey in the My Retirement Picture tool. One of the benefits of the tool is that it helps you to explore the adjustments you can make if you find that your expected pension won’t be enough to cover the expenses you think that you’ll have.

    Watch this short introduction video which explains how My Retirement Picture works.

    Getting started with My Retirement Picture

    To get started, you’ll need to know:

    1. How much you have already saved towards your retirement.
      You can find the amount you’ve saved with Alexforbes by logging on to our website or by downloading the Alexforbes app free from the app store on your phone
    2. How much you are saving towards your retirement each month.
      If you don’t know how much you’re saving, you can find the information on your payslip.
  • You can retire early on the grounds of ill-health, if you:

    • become too sick to carry on working
      AND
    • have not reached the fund’s normal retirement date BUT don’t qualify for a disability benefit
      AND
    • are totally and permanently unable to do your job

    The benefit you get will be the value of your retirement savings in the fund.

  • The age you must retire is determined by the rules of your retirement fund. However, if you don’t need to start receiving a pension right away (for example, if you are able to continue working on a contract basis), you can keep your retirement savings invested in the fund until you’re ready to buy a pension. This is called delaying or deferring retirement. Your financial adviser can explain which of your retirement fund benefits will stop if you choose this option. Find out more about delaying retirement here.

  • A financial adviser can help you to make a financial decision that is right for you based on your individual circumstances. Financial advisers charge fees that are based on the financial products they help you select. For example, if a financial adviser helps you to use your retirement savings to buy a flexible pension or a guaranteed pension, you will be charged a fee.

    Fees can be charged up front when you buy a pension and on an ongoing basis if you choose to receive ongoing advice. The up-front fee a financial adviser charges is limited to 1.5% + Vat of the amount you use to buy a pension, but the actual amount is negotiated between you and your financial adviser. The fees are usually deducted from the amount you use to buy a pension.

    Please contact our My Money Matters Centre, where you can receive retirement benefit counselling and advice from our qualified financial consultants.

  • If you need to start receiving your pension in the month following your retirement date, you will need to meet with a financial adviser at least three months before your retirement date.

    The administration processes including completing and signing forms that are necessary for you to start receiving a pension take time to do, so it is a good idea to start early.

  • Your retirement savings can be divided between flexible pensions (living annuities) and guaranteed pensions (life annuities). There may be up-front and ongoing fees but the amounts will differ depending on the type of pension you choose and what is agreed on by you and your financial adviser.

    In the case of a flexible pension, there will be investment fees on your investment portfolios. Investment portfolio fees are deducted from the value of your investments and won’t be shown separately on your statements. An administration fee is also charged for the administration involved to pay your pension to you and for preparing and submitting your tax information.

Contact us

GET HELP

Questions about a claim or processes:
Client Contact Centre: 0860 100 333 | ccrfadmin@alexforbes.com


Understanding your options or help making a decision based on your personal circumstances (advice):
My Money Matters Centre: 0860 000 381 | mymoneymatters@alexforbes.com