By HUMPHREY MKWEBU
- Pensionable salary: Setting pensionable salary as close to 100% of total earnings as possible is one of the most powerful means to materially improve retirement outcomes – while allowing members to fully use the 27.5% tax-deductible contribution allowance.
- Investment returns: Inflation is the silent enemy of retirement, and SuperFund’s five investment styles – from Smoothed Bonus and Passive to Shariah – are all designed to deliver consistent, inflation-beating returns that compound over decades.
- Preservation: Preservation remains a major challenge, with nearly all members withdrawing balances below R150 000 when changing jobs. While the Two-Pot system will support better preservation over time, this remains a critical behavioural decision.
- Annuity options: 70% of a member’s investment fees are incurred post-retirement, so decisions matter – as much as in the accumulation years. Annuities – like the SuperFund In-Fund Annuity – can offer a blend of flexibility, lower lifetime fees, and living- and guaranteed annuity options (or a blend of both). Collectively, these can lift a member’s replacement ratio even higher.
It’ll take shared will, strong vision, and decisive leadership to move into the mandatory contribution space, increase employee coverage and contributions, and shift the
retirement age – but we’ve made strides already. It’s time to step into the next
phase of intentional change.
HUMPHREY MKWEBU | Managing Director, Old Mutual Corporate
