Yes, many people who dont need the money were smart to leave their money in their SA upon turning 55 to benefit from the attractive 4% interest which is way higher than SSB or Treasury Bills or any Fixed Deposit offered by the banks. The Government has finally realised this and hence the announcement to abolish the SA upon a member turning 55. If members wish to, they can have their excess funds transferred to their OA to earn the much lower 2.5% interest or withdraw the money. Or if they still want to earn 4% interest, they can use the money to top up their RA but the downside is that money is locked up for retirement and cannot be withdrawn anymore. So the party for members enjoying 4% interest in their SA has come to an end.
Most people/retirees who have (lots of) excess money in SA are generally the richer group. So, why should the government continue to pay high interest (with no risk) to this group which is funded by taxpayers (this group will be the ultimate losers) - this loophole should have been plugged a long time ago! This is against the equality policy - high interest saved herein can be redistributed to low(er) income households. Also, high interest with no risk along with liquidity is seriously anomalous here. If someone wants higher returns, sure, withdraw the money and invest it elsewhere - high risk high gain. There is no free lunch in this world.
Yes, many people who dont need the money were smart to leave their money in their SA upon turning 55 to benefit from the attractive 4% interest which is way higher than SSB or Treasury Bills or any Fixed Deposit offered by the banks. The Government has finally realised this and hence the announcement to abolish the SA upon a member turning 55. If members wish to, they can have their excess funds transferred to their OA to earn the much lower 2.5% interest or withdraw the money. Or if they still want to earn 4% interest, they can use the money to top up their RA but the downside is that money is locked up for retirement and cannot be withdrawn anymore. So the party for members enjoying 4% interest in their SA has come to an end.
Most people/retirees who have (lots of) excess money in SA are generally the richer group. So, why should the government continue to pay high interest (with no risk) to this group which is funded by taxpayers (this group will be the ultimate losers) - this loophole should have been plugged a long time ago! This is against the equality policy - high interest saved herein can be redistributed to low(er) income households. Also, high interest with no risk along with liquidity is seriously anomalous here. If someone wants higher returns, sure, withdraw the money and invest it elsewhere - high risk high gain. There is no free lunch in this world.
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