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It is important to bear in mind that any investment has some risk. We therefore recommend that you consult a financial adviser who can help you find the most appropriate products for your needs and circumstances.
Glacier Preservation Funds
Preserve and potentially grow your retirement savings with our flexible preservation funds.
About Glacier Preservation Funds
Continue growing the money you have saved so far when you change jobs so that you can continue looking forward to a comfortable retirement.
You have total freedom to change your underlying investments. There is no charge to make a change, but depending on where you move your money to, initial investment charges may apply.
You can move your preserved retirement savings to another preservation fund, retirement annuity or employer’s fund without any penalties.
This fund requires:
Minimum payments of R100,000 upfront and any additional contributions must be at least R15,000.
Minimum retirement age of 55 years.
Benefits
Access to the widest choice of investments:
A range of risk-profiled investment funds
Local or offshore funds
Actively managed or passive index-tracking funds
Single manager or multi-manager funds
Individual shares, exchange traded funds (ETFs) and other instruments via our stockbroking service
Preserve and grow your retirement savings when you leave your employer
You have access to a wide selection of investment choices, including local and offshore funds, actively managed and index-tracking funds, risk-profiled funds and individual shares via our stockbroking service.
You have complete freedom to change your choice
If you are in a process of insolvency, your preservation fund investment is protected from creditors – they won’t be able to take from your savings
How it works
Opening a preservation fund is quick and easy:
You make a lump sum transfer from your existing provident or pension fund
We invest the money in the underlying investments that you choose in collaboration with your financial adviser
Your money can grow over time based on your underlying investments
You are allowed to make one withdrawal before retirement
You will be allowed to take a portion of your savings as a lump sum. The remainder must be used to purchase an income-generating product (compulsory annuity) to provide you with an income for the duration of your retirement.
Access to your funds is determined by the Two-Pot System, which came into effect on 1 September 2024. In summary, the retirement savings in your preservation fund are divided into 3 components, and each component gets treated differently at retirement.
If you pass away before you retire, your savings will be available to your dependants. The trustees of the fund will take into account your wishes and all your dependants' needs to decide who receives this benefit.
If you are permanently disabled before you retire, your benefit is paid out to you in the same way as if you had reached retirement (aged 55).
Access to your money
Access to your money is determined by the Two-Pot System, which came into effect on 1 September 2024. The retirement savings in your preservation fund are divided into 3 components, and each component gets treated differently.
Vested component: You are allowed to make one withdrawal before retirement. Access is also possible in the case of emigration (three years cessation of tax residency), disability or death.
Retirement component: No access at all, except in the case of emigration (three years cessation of tax residency), disability or death, subject to the applicable fund rules.
Savings component: You can make one withdrawal per tax year, subject to taxation in terms of the individual income tax table. The value of the withdrawal must be at least R2 000 before costs, but there is no maximum withdrawal value
- When you retire
When you retire, you will be allowed to take a portion of your savings as a lump sum. The remainder must be used to purchase an income-generating product (compulsory annuity) such as Investment-linked Living Annuity, our Investment-linked Lifetime Income Plan or a Life Annuity. These aim to provide you with an income for the duration of your retirement. Access to your funds is determined by the Two-Pot System, which came into effect on 1 September 2024. Read more about the Two-Pot System here. In summary, the retirement savings in your preservation fund are divided into 3 components, and each component gets treated differently at retirement:
Vested component: Benefits in the vested rights portion* of this component will be available as a lump sum (subject to taxation), as an annuity, or as a combination. Benefits in the non-vested rights portion* are subject to the purchase of a compulsory annuity (to provide you with an income during retirement) with at least two-thirds of the value. *Members who were previously members of a provident fund, may have both a vested and non-vested rights portion inside their vested component.
Retirement component: All benefits must be used to purchase a compulsory annuity to provide you with an income during retirement.
Savings component: You can take the full amount as a lump sum, or use it to purchase a compulsory annuity.
If the full value of the retirement component + two-thirds of the non-vested rights portion in the vested component is equal to or less than R165 000, the full value of the retirement component and the non-vested rights portion of the vested component may be taken as a taxable cash lump sum.
- Tax
Tax benefits At retirement there is no tax on the amount transferred to a post-retirement product that provides you with an income during your retirement. You don’t pay tax on any interest or dividends, and no capital gains tax is applicable.
What is taxable? Tax is payable on any withdrawal benefit.
- Fees
Fees vary per product and your underlying investment. Please speak to your financial planner to make sure you understand which fees you pay and why.