At retirement you stop working but there are still costs to be covered, specifically living expenses like food, clothing and medical care. Retirement savings are critically important as they help you to cover these costs when you have no income from work.

Sadly, most South Africans are not saving for retirement, those who save do not save enough and research shows that a large number of those who save, tend to withdraw their savings prior to retirement to cover financial emergencies or difficulties that they encounter such as debt.

Currently, retirement savings can only be accessed when the fund member retires, is dismissed or resigns and unfortunately, some fund members are resigning from their jobs only because they need to access their retirement savings due to difficult financial situations.

To help with this situation, the Government is introducing the Two-Pot Retirement System that will come into effect from 1 September 2024.

The changes are being introduced for two reasons:

1. To encourage fund members to save for their retirement and to encourage fund members to keep their retirement savings preserved until retirement age.
2. To help those fund members in serious need due to some financial emergencies or hardships to be able to access a portion of the savings without having to resort to resigning or being dismissed.