IN A NUTSHELL: As a trustee, your influence can make a difference in members’ lives. By understanding retirement fund members’ behaviours, you can help guide them toward a secure future.
Year after year, reports highlight the state of retirement planning in South Africa, shedding light on saving habits.
The 2024 FNB Retirement Insights Survey showed that 50% of respondents had some kind of retirement plan in place but only 75% felt they were on track to a comfortable retirement. It also found that respondents spend as much on clothing – about 7% – as they do on saving for retirement.
According to the 10X Retirement Reality Report 2023/2024 two-thirds of adults aren’t saving for retirement or have no clear plan – 70% of these said that they cannot afford to save as they have nothing left at the end of the month.
Insights from Just Retirement Studies
Tracking the changing dynamics of retirement planning since 2015, the Just Retirement Insights study’s latest findings (2024) also offer valuable lessons:
Goal setting is improving. About 60% of respondents have set retirement goals, compared to only 40% in 2018.
Planning challenges are growing. While more respondents claim to calculate their retirement needs, the number admitting they don’t know how to plan for retirement has surged to 54%, up from 28% in 2022.
Professional advice is overlooked. Of the 50% who plan for retirement, only 3 in 10 seek help from a financial advisor.
Inflation matters. Over 80% of respondents say keeping up with inflation is critical. After years of financial uncertainty, many now prioritise income security over flexibility, seeking retirement plans that protect against market volatility and ensure lifelong income.
Many will rely on social assistance. Alarmingly, three-quarters of South Africans say they will lean on government for support if they do not have enough to fund their retirement.
Retirement confidence is growing. Some good news: The retirement confidence indicator—the respondents’ sense of whether they’ve saved enough—is ticking upward compared to previous years. This positive shift suggests that many are bouncing back from the economic challenges of the COVID era and are taking steps to secure a sustainable retirement income.
Reality check: The savings gap
In an ideal world, people should save 25 times their annual income to enjoy a sustainable retirement. For a household earning R300,000 a year, this equates to over R7 million to maintain their current standard of living! However, respondents in the study have saved only about 60% of this target.
How trustees can make a difference
Your members look to you for guidance. Here’s what you can do to help them navigate their retirement journey:
Provide financial literacy. Share easy-to-understand resources about setting realistic retirement goals.
Encourage professional advice. Help members connect with credible financial advisors.
Foster awareness. Ensure members understand the importance of inflation-proof income and sustainable savings strategies.
By stepping up as a trustee, you’re not just fulfilling a duty—you’re empowering members to take charge of their future.
Since 2015
The first Just Retirement Insights study was conducted in 2015 and re-launched in 2018, with a follow-up in 2019. Just Retirement Insights Lite was completed in 2020 to assess the impact of COVID-19. A full tracking study was conducted in 2022 and most recently in 2024.
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