2 October 2024
In response to the need to know the likely monetary impact that withdrawals will have on retirement savings and post-retirement income, we’ve developed Glacier EstiMate, a tool that provides intermediaries and their clients with illustrations of the withdrawal impact, which will ensure that they make more informed decisions.
Glacier EstiMate: know the monetary impact of Two-Pot
This simple tool, available on SanPort in mid-October 2024, helps intermediaries understand the impact of the saving withdrawals on the member’s final retirement fund value. It projects the final retirement value with and without an immediate savings withdrawal. Therefore, intermediaries can help their clients make informed decisions when considering a savings withdrawal.
The tool is easy to use, requires no pre-use training and has its own user guide and instruction page. We have provided illustrations below of what savings withdrawal might have on a client’s retirement fund value.
The problem the Glacier EstiMate helps solve
We know that any early withdrawal from retirement savings will have a detrimental impact on a client’s retirement as they will have less capital with which to purchase a solution that provides them with a retirement income. The loss in value should not just be measured by the withdrawn amount. Savings in retirement funds are protected from creditors, have tax benefits and are not estate dutiable in the event of death before retirement. Knowing the numbers and these benefits as well as the power that compounded interest growth adds to future income, go a long way to ensuring financial security in retirement.
What we know about the Two-Pot Retirement System
The Two-Pot Retirement System, which came into effect on 1 September 2024, applies to retirement annuity funds, preservation provident/pension funds and provident/pension funds. A fund member’s investment into a fund may consist of up to three components, where applicable. They include a vested, retirement and , as briefly explained below.
The Glacier EstiMate brings us closer to helping intermediaries guide clients to a confident retirement.
Illustration 1: Data inputs
Illustration 2: Projected retirement values (with and without a savings withdrawal)
