Edward West, the Finance Editor, has written an important article in BusinessDay today pointing out that “South African employers and employees are contributing more towards retirement in the worsening economic conditions, but contribution levels are far from what they were in 2002 and well off recommended levels, a survey shows”.
Reference is made to a recent survey conducted by Sanlam Employee Benefits providing insight into the management of a variety of retirement funds in SA.
There is evidence of how employers have successfully transferred the risk of investing to retired employees. “Of the trustees surveyed, the most popular retirement options included living annuities (40%), guaranteed fixed annuities (27%) and with-profit annuities (21%). While about 75% of the funds provided pre-retirement counselling, after retirement 86% of trustees had no further involvement with members”.
Reference is also made to the percentage of employers with HIV/AIDS management programmes and the increase in the proportion of employers providing testing.
He concludes with the following statement “Just over 48% of respondents believed they would have enough time to recover financially from the global economic crisis before retiring, while 23,3% thought they would not and 28,3% were unsure”.