President Cyril Ramaphosa has announced today that the Pension Funds Amendment Bill has been signed into law, making the two-pot retirement system now official.
The amendment resulted from pressure from the trade union movement, will allow fund members to withdraw a part of their pension fund savings before retirement, as reported by News24 .
Contributions will be divided into two pots, where one-third can be drawn on before retirement, while a second pot preserves two-thirds of savings and vests on retirement.
This dispensation gives members of retirement funds access to retirement savings without having to resign or cash out entire pension funds, the Presidency said in a press statement.
The two-pot system consists of the first pot, known as the savings pot, and the second, known as the retirement pot.
