What is the Two-Pot Retirement System?

Two-Pot is a reference to how your retirement savings will be separated as of 1 September 2024 to allow you access to a cash portion while preserving the remaining portion of those retirement savings. Even if some cash is accessed, the bigger portion of retirement savings will be preserved for you until retirement to allow you to be able to retire with a financial safety net. Your money will be put into different ‘pots’, namely your ‘Savings Pot’ and your ’Retirement Pot’. 

There is also the Vested Component, which is made up of all the retirement savings you accumulated before 1 September 2024 (before Two-Pot came into effect). The Savings Pot is made up of 10% of the benefits in the Vested Component but limited to R30 000.00 as a once-off and thereafter one-third of your future service will be added.

The Retirement Pot starts with R0.00 from September 2024 and then two-thirds of your future service are added each month thereafter. This pot will ensure a steady income stream during your retirement years, providing financial security and peace of mind. You cannot access it until you retire.

 

Important to understand: When you make a Two-Pot withdrawal claim, you will have to pay tax on the amount, as well as any money you owe SARS. In other words: if you owe money to SARS, that money will be deducted by SARS when we apply for your tax directive as part of the Two-Pot claim process, and you will receive the balance as your withdrawal amount. 

Here’s more information on the applicable tax:

The table above is from SARS. For more information, click here.

How does the Two-Pot Retirement System benefit you?

The Two-Pot Retirement System offers several key benefits:

• Financial Security: The Retirement Pot will guarantee a reliable income for you during retirement, as it is inaccessible while you are employed.
• Flexibility: The Savings Pot allows you to access cash in the case of an emergency if you need it without resigning. Even if some cash is accessed, the bigger portion of your retirement savings will be preserved for you until retirement, so that you can retire with a financial safety net.

 

Report Fraud and suspicious activity

If you suspect any fraud, irregular or suspicious activity contact the Call Centre immediately at 0800 11 45 48 (from South Africa) or +27 10 013 3366 (from outside South Africa). Should you need to do so anonymously there is also the Vuvuzela Fraud and Ethics hotline (https://www.thehotline.co.za) which can be contacted on 0800 212 320.