RETIREMENT PLANNNING Retirement planning is a subject most of us avoid. It’s a time in our life which we tend to not think about or we tend to put on hold as there are “more important” things to take care of first. Retirement may feel years away, but it’s important to put plans in place as early as possible to ensure that you can achieve your retirement goals. It is estimated that 70% of South Africans that reach retirement age are not able to retire with the same lifestyle that they have become accustomed to. Sadly, most South African’s only start thinking about saving for retirement 15 years before they retire, which is far too late to make up any savings shortfall. The reality is that the earlier you start to save – ideally from your first day of employment – the better your chances are of being financially secure when you retire. HOW DOES A RETIREMENT ANNUITY WORK - Make Payments You contribute a lump sum or make regular monthly payments to the retirement annuity policy - Choose an investment fund Your payments are invested in an investment fund of your choice and are expected to grow over time based on the performance of your investment fund. Your advisor will assist you with selecting the most appropriate investment fund for you. - Receive a tax rebate Each year you will receive a tax certificate which you include when you submit your tax return. You will receive a rebate on the premiums paid each year. - Retire and receive benefits You can retire any time from age 55 to receive your retirement savings. - Get up to one third cash When you retire, you can take up to one third of your retirement savings as a cash lump sum withdrawal. This withdrawal will be subject to tax. - Receive an income during retirement Legislation requires that the balance must be invested to pay you a monthly income during retirement BENEFITS OF A RETIREMENT ANNUITY 1. Should you have a situation where you cannot contribute towards premiums any longer. The R.A will be placed into a paid up state. Your funds will remain with the Life office you have chosen to invest with until such time that you retire. 2. Your retirement savings are safe, irrespective of any personal financial loss you may suffer. People you owe money to will not be able to touch the money you have saved for retirement. 3. Your minimum contribution is R200 p/m with a minimum premium term of 20 years. Should your term be less than 20 years you will be required to contribute at a higher rate (eg R350 or R500) 4. You may commence a retirement annuity at any age. ADDED BONUS - Sanlam have launched a phenomenal “new generation” Retirement Annuity. They are the first in the market place to launch a retirement annuity that offers the following; - No penalties in the event you decide to make your Retirement Annuity paid up prior to retirement age. This means that your fund value will not be effected due to cancellation of premium contributions. This is a first in the market place and certainly is a trend setter. - You will receive a bonus based on the length of time you ultimately invest in the retirement annuity for. Whenever you retire, Sanlam will add the bonus to your retirement savings thus boosting your retirement fund considerably. - Even if you decide to retire earlier than planned Sanlam will still pay your Bonus out. If you are interested in starting a Retirement Annuity for yourself or for a loved one please contact us for assistance. Kind Regards, Roberto Francisco
Posted on: Tue, 18 Mar 2014 14:45:37 +0000
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