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Two-pot system
Understanding the two-pot system
On 1 September 2024, a new era in retirement savings begins. It is called the two-pot system. In terms of the new rules, you will be allowed to access some of your retirement savings, while you are still employed, in case of emergencies.
Need more info? Watch these quick videos that cover the basics of the two-pot system:
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How it works
What you should know
- How it works
Preserve your emergency savings
Seek advice
Access savings as a last resort
Pointers to help you prepare
The new two-pot system divides your retirement savings into three pots. As a member of a retirement fund, you will be allowed to make one withdrawal per tax year from the emergency savings pot. You will only be able to access money saved in your retirement pot when you reach your retirement age.
Vested Pot
This pot is made up of all of your contributions, including interest and growth before 1 September 2024.
You will still be allowed withdraw from this pot if you resign or are retrenched.
No more contributions will be made to the vested pot after 1 September 2024.*
* No more contributions will be made to the vested pot after 1 September 2024 – except for members of provident funds and provident preservation funds who were 55 years or older on 1 March 2021.
Emergency Savings Pot
You can withdraw once per tax year (1 March to 28 February).
If you have less than R2,000 in your emergency savings pot, you can't make a withdrawal.
You will be taxed for each withdrawal at your marginal rate.
Retirement Pot
This pot is off bounds until you reach your retirement age.
You cannot access the retirement pot until you retire.
Remember, you will be taxed for each withdrawal you make from your emergency savings pot. So, use the calculator to find out how much you might be taxed, before you withdraw.
What are the estimated values of your emergency savings and vested pots?
On 1 September 2024, your retirement fund will have the vested pot with the fund value of your retirement fund on 31 August 2024. This pot will be reduced with a once-off seeding amount to the emergency savings pot.
On 1 September 2024, your retirement pot will have no value. From this date, however, 2/3 of all your future contributions will be allocated to this pot.
Calculate your pots' values
If you have more than one retirement fund, you will have to do this illustrative calculation for each plan.
What happens if I make a withdrawal from my emergency savings pot?
Withdrawals
How to apply for a withdrawal
- Check your eligibilityEnsure that you have a minimum balance of R2,000 in your savings component or that you have not already made a withdrawal in the tax year.
- Consider the impact of tax on your withdrawalYour withdrawal amount will be taxed at your marginal tax rate. If you owe SARS any tax, it will also be deducted from your withdrawal amount before it is paid out to you.
- Complete the withdrawal requestRegister on Sanlam Secure Services to obtain the withdrawal request form or contact Sanlam Client Care Services.
- Submit your withdrawal requestSubmit the completed form along with all required documentation for processing.
- Sanlam requests a tax directive from SARSOnce you’ve submitted your withdrawal request form and SARS has issued a tax directive, you cannot cancel your request to withdraw.
- Wait for processingSanlam will process your withdrawal request and pay the funds into your account.