South Africans are drawing on the savings component of the two-pot retirement system mainly to manage debt and everyday expenses, according to research discussed by Discovery.
Guy Chennells, Discovery Corporate and Employee Benefits’ chief commercial officer, told eNCA that housing costs, childcare, education expenses and debt were among the pressures reported by people making withdrawals.
He said withdrawal patterns had been broadly consistent across age groups, although members between 30 and 40 appeared slightly more likely to access their savings.
The two-pot system, introduced in September 2024, divides retirement contributions between a retirement component that is preserved and a savings component that members may access under specified conditions.
Chennells said the findings showed that withdrawals were usually linked to several pressures rather than a single reason. Discussions around the research also identified mental-health strain and gambling as possible factors in some cases, but the available material did not establish them as the main causes of withdrawals.
Members who withdraw from the savings component pay tax at their marginal income-tax rate. The withdrawal also reduces the amount that remains invested for retirement.
The latest observations add to the picture of how households are using the system after its first two years. They suggest that immediate financial pressure remains the central reason many workers choose to access part of their retirement savings.
