Workers could SOON have access to a portion of their retirement funds

Deputy finance minister David Masondo says government is still working on a piece of legislation that would enable distressed employees to have access to a portion of their retirement savings.

Masondo addressed the post budget Progressive Business Forum in Sandton, Johannesburg on Monday, 28 February 2022.

He has told the forum that the COVID-19 pandemic presented a range of serious financial constraints and prompted workers to make appeals for their retirement savings to be unlocked.

YOU CAN ALSO READ: Get your retirement savings out of SA now

ACCESS TO YOUR PENSION? PUBLIC CONSULTATIONS ONGOING

David Masondo couldn’t give an exact time frame for when exactly employees would have access to their retirement funds, but if what he says is anything to go by, this could be much sooner than anticipated.

For now, Masondo says they are currently in the process of public consultations on the matter, which should be finalised before the end of the current financial year.

The deputy minister says deciding whether an employee can have a part of their money would be decided upon by its trustees.

“There’s a portion that you can’t get access to and then there is a portion that you can can get access to. But it is not the minister, who’ll say, ‘workers, you’ll get access your retirement’. It is still within the hands of the trustees to decide whether workers will have access”

Deputy finance minister David Masondo

For now, people seeking to access their retirement funds (before the desired age, of course), can only do so once they resign or when they have been retrenched, but this comes financial implications so massive that people would rather sit it out than cash out their monies – Getting your hands on your retirement prematurely means you’ll be taxed exorbitantly.

YOU CAN ALSO READ: Retirement Annuities vs Tax-Free savings. Where to begin?