Extremly insightful i have been reading about it but still didnt get a clear picture but now i totally understand. Thank you so much. Its kind of giving me mixed feelings
Great explanation! People are truly not educated about this especially the part about the vested pot so now are threatening to resign by 31 Aug in this economic climate to gain access to all their funds😢
Thank you. Resigning would be a crazy move because there’s no guarantee that they’ll get another job. It’s just that the concept is misunderstood 😢🤷🏿♀️
You’re welcome. The 2/3 will be “preserved”. E.g. if you’re moving to a new employer you can either transfer it to their retirement fund or a private retirement fund. But you won’t be allowed to cash out the 2/3 until the retirement age.
Thanks for the info, but my question on Tax is that? After withdrawing the 30k, will you be taxed monthly frm yr salary or this will be a once off frm the 30k????
Copy paste answer: Any withdrawals made from the savings component will be taxed at your marginal tax rates if withdrawn before retirement. A withholding tax process will apply, and the withdrawal amount will be added to your annual income at the end of the tax year, potentially resulting in your tax bracket shifting to a higher bracket, which means you may end up with a higher tax amount to pay. Interpretation: The R30k will be taxed at the tax rate your salary is taxed, but the tax rate becomes higher as you receive more income. So the tax portion will be withheld similar to (PAYE) meaning that you won’t get the entire R30k.
The retirement pot can only be accessed on death or at retirement. No withdrawals will be allowed before retirement. The retirement pot balances will be used to purchase a regular pension in retirement. However, if the balance of the retirement pot is R165 000 or less, then a full cash withdrawal is possible. If a member emigrates, they will not be able to access the money from the retirement pot for three years. (Lazy to type so this is a copy paste answer 😅)
Depends on your financial commitment. But remember other ppl might be at the verge of losing their homes because they behind with payments, or the kids might need money for registration etc. it can eliminate the high interest of the mashonisas
Extremly insightful i have been reading about it but still didnt get a clear picture but now i totally understand. Thank you so much. Its kind of giving me mixed feelings
You’re welcome. I also have mixed feelings about it, but let’s see how it unfolds. They can still change the rules later on 😅
Great explanation!
People are truly not educated about this especially the part about the vested pot so now are threatening to resign by 31 Aug in this economic climate to gain access to all their funds😢
Thank you. Resigning would be a crazy move because there’s no guarantee that they’ll get another job. It’s just that the concept is misunderstood 😢🤷🏿♀️
Thanks a lot very informative.
I would like to know if a person die before retirment age what will happen
The beneficiaries can access it either as a lump sum or annuity.
Well understood. What will happen to RA does this rule apply to RA also.
Yes. Your RA contributions will also be split. But I think existing rules will apply when it come a to withdrawing your current balance.
Thanks alot .
Now u said if someone resigns he wont have access to the 2/3 retirement but only the savings 1/3.now where is that 2/3 going to?
You’re welcome. The 2/3 will be “preserved”. E.g. if you’re moving to a new employer you can either transfer it to their retirement fund or a private retirement fund. But you won’t be allowed to cash out the 2/3 until the retirement age.
@xireninsights isn't transferring fund deemed as received, Therefore, it will be taxed 😢
@@Sheilzdarlingz I think it's the 1/3 which is taxed since it goes into your savings account
Thanks for the info, but my question on Tax is that? After withdrawing the 30k, will you be taxed monthly frm yr salary or this will be a once off frm the 30k????
Copy paste answer: Any withdrawals made from the savings component will be taxed at your marginal tax rates if withdrawn before retirement. A withholding tax process will apply, and the withdrawal amount will be added to your annual income at the end of the tax year, potentially resulting in your tax bracket shifting to a higher bracket, which means you may end up with a higher tax amount to pay.
Interpretation: The R30k will be taxed at the tax rate your salary is taxed, but the tax rate becomes higher as you receive more income. So the tax portion will be withheld similar to (PAYE) meaning that you won’t get the entire R30k.
Hi i need to know that when i would be allowed to withdraw the whole funds if want to withdraw ?
The retirement pot can only be accessed on death or at retirement. No withdrawals will be allowed before retirement. The retirement pot balances will be used to purchase a regular pension in retirement. However, if the balance of the retirement pot is R165 000 or less, then a full cash withdrawal is possible. If a member emigrates, they will not be able to access the money from the retirement pot for three years. (Lazy to type so this is a copy paste answer 😅)
@@xireninsightswhat is the prescribed age of retirement ? 55years or 60 years ?
So how will 30 000 help anyone here in SA?
Depends on your financial commitment. But remember other ppl might be at the verge of losing their homes because they behind with payments, or the kids might need money for registration etc. it can eliminate the high interest of the mashonisas