Although the president signed the Pension Funds Amendment Bill into law on the weekend to remove another legislative barrier to the implementation of the two-pot retirement system in just over six weeks, a substantial amount of work still needs to be done before pension fund members can start withdrawing a portion of their retirement savings.
Michelle Acton, retirement reform executive at Old Mutual, says Old Mutual Corporate welcomes this new law, as it allows the Financial Sector Conduct Authority FSCA to start approving rule amendments once gazetted. These amendments are critical for approval before funds can start paying any claims from 1 September 2024.
Implementing the potsThere is a misconception that funds must create the pots before 1 September. The law comes into effect on 1 September and then funds can start implementing the pots and seeding them.
Acton also warns that despite this positive development, retirement funds and administrators still have a substantial amount of work to do before they will be able to pay claims, including ensuring administration readiness and integration with Sars.
Therefore, members who are desperately waiting for this money to bail them out of their financial woes will have to be patient and not bank on the money coming being available on 1 September.
