Navigating the world of finance can indeed feel very daunting. You’re not alone. Many of us grapple with the complexities of financial decisions, feeling the weight of stress and uncertainty about what lies ahead. We recognise the challenges you may face and are here to support you every step of the way.
When you need assistance - whether it's for financial decisions, submitting a claim, or seeking guidance - we’re here to help. For efficient support, we encourage you to use these dedicated channels to ensure your query is tracked and handled effectively:
Want to Check Your Savings Pot Balance? For the quickest way to check your balance,
simply message "Hi" to +27 72 814 6929 on WhatsApp and log in to see your fund information.
With the new tax year starting 1 March 2025, you are eligible to make a withdrawal from your Savings Pot. But remember, you can only make one withdrawal per tax year – and you don’t have to withdraw now, or at all. Your savings remain safe until you're ready. This is how it will work this year:
Our NMG Benefits WhatsApp service is designed with you in mind - It’s more than just a place to make withdrawals; it’s a comprehensive, resource-rich platform that helps interact with your retirement fund benefit, understand the Two-Pot System and make informed decisions about your financial future. Simply message "Hi" to +27 72 814 6929 on WhatsApp to explore this service. Learn more below:
In addition to WhatsApp, we provide two other options for managing your withdrawals, giving you the flexibility to choose what works best for you. You can also withdraw through the Member Portal or complete a Claim Form, though we recommend using the form as a last resort for the smoothest and most seamless experience. View all your options here and discover more details about each one, conveniently available in four languages:
When you withdraw money from your savings pot, you will be taxed at your marginal rate if you withdraw before retirement. Unlike contributions to your retirement fund, which aren’t taxed, any amount you take out will incur tax deductions. It’s important to ensure you have no outstanding tax returns and don’t owe SARS, as any debt owed will be deducted from your withdrawal amount. Once you apply for a withdrawal, your pension fund will request a tax directive from SARS, which tells them how much tax to deduct from your withdrawal.
The value of the benefit in your savings pot can change daily because it’s invested in financial markets that fluctuate regularly, often daily. Prices of the assets in which your savings are invested rise and fall based on market conditions, which in turn affects the value of your benefit in the savings pot, as these market unit shares are typically priced every day. This is a normal part of investing, and while short-term changes may seem worrying, it’s the long-term growth that typically benefits your savings.
The retirement pot holds your strict retirement savings. From 1 September 2024, two-thirds of your monthly contributions will go into your retirement pot. You will not be able to withdraw any money from this pot until retirement age. When you retire, this money must be used to buy a pension product, it usually cannot be taken as cash.
There will be a once-off transfer of 10% of your existing retirement savings from your vested pot of your pension, provident, retirement annuity or preservation fund into your savings pot on 1 September 2024. This is so that you have a starting value in your savings pot, otherwise it would start at zero. The amount transferred will be a maximum of R30 000, so on 1 September you will see a balance in your savings pot of anything up to R30 000.
By law, all members of registered retirement funds must participate in the two-pot system, but there are some exceptions. The two-pot system will apply to you unless you are a pensioner, a member of an unclaimed benefit fund, or a member of a beneficiary fund. If you are a member of a provident fund and you were over the age of 55 on 1 March 2021, and you are still a member of the same provident fund, then you have a choice to either opt in to the two-pot system or continue to opt out.
You should familiarise yourself with the new rules so you know what to expect and update your personal information at your payroll office. Especially your ID number, contact number, email address, tax number, and employee number.
Instead of seeing your fund credit as one amount, you will now see three different values in three different pots (which are also called “components” in the legislation): a vested pot, a savings pot, and a retirement pot.
You can withdraw from your savings pot once every tax year (remember, the tax year runs from 1 March in one year to 28 February the next year). But there are some requirements you need to meet:
You will need to ask your employer or retirement fund administrator about how to withdraw from your savings pot. If your retirement benefit is administered by NMG Benefits, you will be able to withdraw from your savings pot in a number of ways:
You will need to ask your employer or retirement fund administrator about fees. If your retirement benefit is administered by NMG Benefits, you will be charged a fee for the withdrawal. The fee will depend on the value of your withdrawal, calculated as 2.5% of the gross withdrawal value with a minimum of R85 and a maximum of R600. So, if you decide to withdraw R20 000 from your savings pot, you will pay R500 [R20 000 x 2.5% = R500] and if you withdraw R30 000 you will pay R600 [R30 000 x 2.5% = R750 max R600].
If you withdraw from your savings pot before you reach retirement age, you will be taxed at your marginal tax rate which is based on your gross annual income and the income tax table. The administrator will apply for a tax directive from SARS to confirm the tax rate that they will charge on your savings withdrawal benefit.
Bear in mind that it is possible for the value of your withdrawal to move you into a higher tax bracket once it is added to your annual income, so you may need to pay more tax than you think.
If you have any outstanding debt to SARS, the administrator may be instructed by SARS to pay your debt from the savings withdrawal amount first, before any funds are paid to you.
You don’t need to do anything. If you don’t want to withdraw money from your savings pot, you can continue to save towards your retirement and either leave the funds in your savings pot or transfer the funds from your savings pot into your retirement pot at any time.
It is possible to move money from your vested pot into your retirement pot, and from your savings pot into your retirement pot. But it is not possible to move money out of your retirement pot for any reason. You might consider moving money from your savings pot into your retirement pot if you want to remove the temptation to withdraw it, and make sure the money is protected for your retirement.
You will need to ask your employer or retirement fund administrator about how to transfer money between pots. If your retirement benefit is administered by NMG Benefits, you will be able to transfer funds between pots using the same platforms as you do for withdrawals: the Web Portal, or in a WhatsApp chat with NMG Benefits, or using a form. We will communicate detailed instructions after 1 September 2024.
The current legislation will apply, so you will have the option to either withdraw your retirement savings as cash or transfer the funds into a preservation fund or another retirement fund.
If you resign or are dismissed or retrenched after the two-pot system is implemented, you will have different rules for the different pots:
Your retirement savings will be in different pots, and there are different rules for each pot:
* If the combined value is less than R165 000 then it can be taken as cash, and taxed according to the SARS retirement lump sum tax table.
Any cash portion that is taken from your retirement benefit will be taxed. So, if you take cash from any of your pots when you retire then you will be taxed according to the SARS retirement lump sum tax table.
Our Benefit Counsellors are here to support you at every stage of your employment journey, from onboarding to offboarding and everything in between. As part of our member support, they help you understand key financial concepts, empowering you to make informed decisions. They assist with financial basics such as budgeting, saving, and debt management, while providing clarity on how your fund benefits and medical aid options work.
They also help demystify the complexities of retirement planning, making it easier for you to understand contribution rates, savings consolidation, and available retirement options. Additionally, they educate you on setting up a Will and break down any jargon so you can make the best choices for your future. With their support, you’ll gain the knowledge and confidence to take control of your financial wellbeing.
Did you know? Less than 15% of South Africans have a Will in place, and five out of six estates registered at the Master of the High Court in Pretoria are not executable. This leaves many families in limbo during an already difficult time.
Let’s work together to ensure your legacy isn’t just another statistic. It’s essential to keep your will valid, current, and executable, so your assets are distributed as you intended, and your loved ones are spared unnecessary legal burdens. Our NMG Benefits Wills and Trusts platform makes drafting your will simple and secure. In just 10 minutes, by answering a few straightforward questions, you can create your will and store it online, ensuring it’s never lost and always up-to-date.
