Preservation fund

What happens to my retirement fund after I resign?

When you resign from your job, your options depend on whether you have a provident/pension fund or a Retirement Annuity (RA).

Here's what you need to know:

For Provident Funds and Pension Funds:

Your Preservation Options:

You can transfer to a Preservation Fund to maintain tax benefits and continued growth.

Your Withdrawal Options:

Under the two-pot system (effective 1 September 2024):

  • Vested Component: Full withdrawal available, subject to tax.
  • Savings Component: Full withdrawal available, subject to tax and annual withdrawal limits.
  • Retirement Component: Must be preserved until retirement.

Pre-September 2024 funds or if not subject to two-pot system:

  • Full or partial withdrawal is allowed, subject to tax.

For Retirement Annuities (RAs):

Your Preservation Options:
  • Keep your existing RA: Your RA is already in your name, so you can continue with it as is.
  • Transfer to another provider: You can move your funds to a different RA provider such as 10X Investments if you'd like. Read more about the 10X Retirement Annuity here.
Your Withdrawal Options:

Under the two-pot system (effective 1 September 2024):

  • Savings Component: You can withdraw from this pot once per tax year, even if you haven't resigned. Minimum withdrawal is R2,000, with no maximum limit.
  • Retirement Component: This remains preserved until retirement age (typically 55).

Vested Component (pre-September 2024 funds): These remain inaccessible until retirement age, typically 55.

Important Considerations:

  • Withdrawing reduces your retirement savings significantly.
  • Consider your long-term financial security before making withdrawal decisions.
  • Preservation maintains your saving momentum and tax benefits.

Two pot calculator

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