How Preservation Funds work and what investors need to know

Preservation Funds: What are they, and how do they work?

Moving jobs, and unsure of how to look after your pension or provident savings? Our preservation fund video will give you all the answers. A preservation fund maintains the tax benefits of your savings, and ensures your money has the best chance of growing and providing for your retirement.

00:00 - Intro

00:26 - What is a preservation fund?

01:44 - How does a preservation fund work?

02:49 - What are the benefits of a preservation fund?

03:34 - Withdrawal rules and how much you can withdraw from a preservation fund

05:31 - How much does a preservation fund cost?

06:49 - Can you add more money to a preservation fund?

07:13 - What happens to a preservation fund at retirement?

07:37 - Can you transfer a preservation fund?

08:11 - Preservation fund vs retirement annuities

09:00 - Preservation funds vs pension/provident funds

09:34 - Can you invest offshore in a preservation fund?

10:29 - What are the risks of a preservation fund?

11:02 - What happens to a preservation fund on death?

11:25 - Is a preservation fund right for me?

Got more questions on preservation funds? Check out our preservation fund FAQ page.

Do your Preservation Fund sums with our calculator

Make sure your hard work doesn't go to waste. Make sure you know how much money you can save by preserving your pension or provident savings in a low cost, high performance 10X Preservation Fund.

Stop paying high fees, and make Future You more money

Higher fees very likely means lower returns (and here's the maths to prove it)

Paying high fees on your retirement investments (such as a retirement annuity or a living annuity) almost always means less money in your pocket, and less money for your retirement. Read more

A small percentage saving on fees, although seemingly inconsequential, could mean significantly more money for you in the future. Let’s look at an example to compare higher fees (3%) with lower fees (1%) to help illustrate this.

• Investment period of 30 years
• Initial lump sum investment of R1 million
• Return of 12% per annum
• An inflation rate of 4%

Example 1 (1% Fees): Real investment value is approximately R6.2 million

Example 2 (3% Fees): Real investment value is approximately R3.7 million

Always make sure you understand your Effective Annual Cost (EAC). This will be shown on your statement or you can request it from your service provider. EAC is a standardised metric that was introduced by ASISA. All else being equal, a higher EAC would mean that less of your investment returns can be reinvested and potentially grow and compound over time.

At 10X, we keep our fees low, so that more of your money is invested for you. If you've got investments elsewhere, you can use our EAC calculator to compare service provider fees with 10X.

Or click below to get a free comparison report from our investment consultants, who are always available to give you the facts on your investments, at no cost to you.