According to the law signed by South African President Cyril Ramaphosa, from September 1, 2024, pension funds will be divided into two parts: accumulative and pension. This is reported by Prensa Latina, a partner of TV BRICS. The accumulative part will account for one-third of all contributions and will be available for withdrawal at any time without any restrictions. The pension part (two-thirds of contributions) will be used to pay a life annuity upon retirement.

The innovation allows employees to withdraw part of their savings before retirement. This can be useful for financial problems such as paying for education, medical treatment, or buying a home.

However, to avoid rash spending, there is a limit: no more than R2,000 (about US$109) can be withdrawn in one year.

This law is intended to improve the lives of workers by giving them more control over their retirement savings.

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