EDITORIAL: A retirement system in crisis
A new survey by Alexander Forbes shows only 5.17% of members can maintain their standard of living in retirement
The sad state of retirement savings in SA is only getting worse. No amount of tax incentives and pleading from the Treasury seems able to entice people to do better. Consumer education initiatives from the financial services industry seemingly also have little success of changing behaviour, according toAlexander Forbes’s member watch survey released in November. According to the survey, only 5.17% of people who retired from funds administered by Alexander Forbes are able to maintain their standard of living. The data is based on more than 2,000 retirement funds, representing more than 1-million members in total, that are administered by Alexander Forbes. The survey also showed that the rate of preservation when people change jobs had decreased to just 8.7% from 11.5% six years ago. That means more than nine in 10 people who changed jobs, retired or left their retirement funds for another reason took their savings in cash, rather than transfer it to a new retirement savings product o...
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