All South African citizens or permanent residents who live in the country and are 60 years or older can apply for an “older person’s grant” or “old age pension” as it used to be called. To qualify, you must not receive any other social grant for yourself, not be cared for in a state institution, not earn more than R78,120 if you are single or R156,240 if married and not have assets worth more than R1,115,400 if you are single or R2,230,800 if you are married.
However, even if your application is approved, the maximum amount that you will get is R1,780 per month, unless you are older than 75 years, then you will get R20 more or R1,800.
Clearly, relying on a government “grant” is not an option when it comes to planning your retirement.
Much has been written about the “sandwich generation” – the generation of people, typically in their thirties or forties, responsible for both bringing up their own children and for the care of their ageing parents who failed to achieve their own retirement readiness. It is such a common and enduring occurrence that the term was added to the Merriam-Webster Dictionary in 2006.
While many of us may be able to depend on our children to support us in old age, it is important to understand the heavy financial and emotional stress it can place on a family.
Your employer’s retirement fund?
The 2018 Member WatchTM retirement fund survey found that while millions of South African employees rely on the money saved in their employer’s retirement fund, this money is not enough to sustain them in retirement. Similarly, the Just Retirement Insights survey by Just SA found that South Africans’ expectations of what their retirement income will be, based on current savings and returns, will not be realised, given what is achievable in current market conditions and the fact that men and women aged 65 in SA have a 50% chance of living beyond ages 83 and 87, respectively. Many other local and international surveys reach the same conclusion.
Given these alternatives, there is only one viable option – and that is to take action today to secure retirement readiness for yourself. Fortunately, this is not impossible or even difficult, with a little guidance.
Remember, your financial coach is at the ready to help! Simply contact us for assistance in professionally planning for your retirement, ensuring that when your golden years arrive, you will be financially independent and able to enjoy the fruits of your life’s work.