Personal Finance | Two-Pot Retirement System explained for first-time contributors

A major change to SA's retirement system, known as the Two-Pot Retirement System, will take effect on March 1, 2024, affecting all retirement fund members.On 1 March 2024 there will be a radical change affecting everyone who is a member of a retirement fund. This is known as the Two-Pot Retirement System and applies to any member of an employer pension/provident fund, a retirement annuity, or a preservation fund.

To recap, from 1 March 2024 all retirement contributions, whether to an employer fund or a retirement annuity, will be split between a Savings Component and a Retirement Component.One-third of the member’s contributions will be paid into the Savings Component. The contributions, and all growth in the fund, would be accessible prior to retirement. Withdrawals may only be made once in a calendar tax year and only if the value of the Savings Component is at least R2 000 or more.

If she withdrew all her funds from her Savings Component before age 65, the withdrawals would be fully taxed at her marginal tax rate, and she would not have the R4.5 million in her Savings Component to provide a lump sum at retirement. Depending on the retirement fund, it may be possible for the funds in the Savings Component to be invested in different investment portfolios from the Retirement Component.

Philippines Philippines Latest News, Philippines Philippines Headlines

Similar News:You can also read news stories similar to this one that we have collected from other news sources.

Japan to chair G7 finance ministers meeting at IMF conference on Oct 12Japan will chair a meeting of finance ministers and central bank governors from the Group of Seven (G7) advanced nations on Oct. 12 to discuss the war in Ukraine and the world economy, Finance Minister Shunichi Suzuki said on Tuesday.
Source: ReutersAfrica - 🏆 31. / 53 Read more »

Travis Kelce’s net worth, life earnings, and personal lifeTravis Kelce’s net worth has been on the increase because of his prowess as a football tight end. How much is he now? Find out all about him here.
Source: brieflyza - 🏆 10. / 68 Read more »

Angola mulls slowing fuel subsidy removal after protests - finance ministerAngola may slow the removal of fuel subsidies to avoid a repeat of protests in June over a near-doubling in petrol prices in which at least five people were killed, the southern African country's finance minister said on Monday.
Source: ReutersAfrica - 🏆 31. / 53 Read more »