• Wealth
  • Life
  • Future
  • Ventures
  • Content Hub
Fedgroup Content Hub
  • Editor’s Pick
  • Newsroom
  • Impact Farming
    • All
    • Blueberries
    • Honey
    • Solar
    Fedgroup has been named the CFI Best Impact Agribusiness Investment Partner Africa 2020

    Impact Farming gets global recognition

    A woman harvesting blueberries

    Take a look at Metsi Berries

    Solar panels on Milnerton Mall

    News from the Farm: Solar Panels

    Beekeepers with hives

    News from the Farm: Beehives

    Fedgroup Impact Farming

    News from the Farm: Blueberries

    OzBlue bushes

    United Exports receives World Development finance to expand operations

    Beehives being smoked to get honey

    Agriculture finance – key to expanding commercial farming operations

    Fedgroup Impact Farming Solar Farm

    South Africa to have major advantage in the renewable energy space

    A woman harvesting blueberries

    How to earn income from blueberries through the Fedgroup App

    Blogger Rachael Williams

    Being financially savvy in 2019

    Money from farming

    CEO Grant Field talks to eNCA

    solar panels on a wine farm

    Know more about earning income from a solar panel

    Thinking like a bee to solve problems

    If you want to tackle big problems, try thinking like a bee

    Blueberries

    Fedgroup Impact Farming featured in MomTalk

    Blueberry bushes under netting

    Blueberries are transforming land use in Limpopo

    Making money out of farming without owning a farm

    Bee pollination services: earn income not only from honey

    Picking berries under netting

    Local is lekker: farming app brings about sweet profits for investors

    solar power on a school in Port Elizabeth

    Fedgroup Impact Farming makes a difference in Port Elizabeth

    Know more about how Fedgroup's Impact Farming works when buying a bee hive.

    Want to know more about how your hive works?

    Naturally swarmed bees in hive in Port Elizabeth

    Netflix series: Rotten

No Result
View All Result
Fedgroup Content Hub
  • Editor’s Pick
  • Newsroom
  • Impact Farming
    • All
    • Blueberries
    • Honey
    • Solar
    Fedgroup has been named the CFI Best Impact Agribusiness Investment Partner Africa 2020

    Impact Farming gets global recognition

    A woman harvesting blueberries

    Take a look at Metsi Berries

    Solar panels on Milnerton Mall

    News from the Farm: Solar Panels

    Beekeepers with hives

    News from the Farm: Beehives

    Fedgroup Impact Farming

    News from the Farm: Blueberries

    OzBlue bushes

    United Exports receives World Development finance to expand operations

    Beehives being smoked to get honey

    Agriculture finance – key to expanding commercial farming operations

    Fedgroup Impact Farming Solar Farm

    South Africa to have major advantage in the renewable energy space

    A woman harvesting blueberries

    How to earn income from blueberries through the Fedgroup App

    Blogger Rachael Williams

    Being financially savvy in 2019

    Money from farming

    CEO Grant Field talks to eNCA

    solar panels on a wine farm

    Know more about earning income from a solar panel

    Thinking like a bee to solve problems

    If you want to tackle big problems, try thinking like a bee

    Blueberries

    Fedgroup Impact Farming featured in MomTalk

    Blueberry bushes under netting

    Blueberries are transforming land use in Limpopo

    Making money out of farming without owning a farm

    Bee pollination services: earn income not only from honey

    Picking berries under netting

    Local is lekker: farming app brings about sweet profits for investors

    solar power on a school in Port Elizabeth

    Fedgroup Impact Farming makes a difference in Port Elizabeth

    Know more about how Fedgroup's Impact Farming works when buying a bee hive.

    Want to know more about how your hive works?

    Naturally swarmed bees in hive in Port Elizabeth

    Netflix series: Rotten

No Result
View All Result
Fedgroup Content Hub
No Result
View All Result

Your paycheck unpacked: Part 1

Fedgroup by Fedgroup
June 12, 2019
in Home Page
0
Your paycheck unpacked: Part 1

By Walter van der Merwe, Fedgroup Life CEO

0
SHARES
1.5k
VIEWS
Share on FacebookShare on Twitter

Pension fund/provident fund contributions

What is your pension fund/provident fund contributions?

Most employers deduct an amount from your salary for retirement savings (pension and provident fund). Sometimes employees are given the opportunity to decide what percentage of their salary they want to contribute and other times the employer chooses a percentage. There is some flexibility, but you need to understand how that works, what the company has put in place for you and what your options are. These deductions, called contributions, that employers have put in place are not optional, but that’s a good thing. Because retirement contributions are tax-deductible, it is one of the most effective ways to save. More importantly, you are paying this money towards a better future for yourself.

All your retirement contributions are shown on your payslip. Whether you are starting on a job or changing jobs, it is important to look at each deduction on your payslip to understand what they mean.

It is also important to check whether you belong to a pension or provident fund. The biggest difference between the two is that when you have a pension fund, you can take as much as a third of your money as a cash lump-sum payout when you retire. The rest will be invested and paid out to you as a monthly pension, as long as there is money available. This helps to ensure you don’t blow through all your lifelong savings in a short period!

With a provident fund, all your money is paid out in one cash lump sum when you retire, which is not necessarily a bad thing, as long as you invest that money early on – and wisely.

All contributions towards retirement savings (pension or provident fund) are tax deductible, up to certain limits set by SARS.

While we don’t have a quick formula to help you choose the best option, there are many ways to get sound financial advice from a financial advisor who will consider factors such as your income and retirement goals.

Why should I contribute?

There seems to be a common misconception that pension is only for one’s parents or grandparents and not for the younger generation, or that people have a lot of time to worry about that. In fact, you need to save a little every month over a long time to ensure that you have enough for when you reach retirement.

For many South Africans, pension or provident fund contributions are their only form of saving for retirement. Aside from the fact that it helps lower the tax on your income package, it encourages you to start saving early on. That is why many people prefer to work for companies that offer employee benefits.

Even the people who put some money away for retirement are often not putting away enough. The average amount that South Africans are saving to buy a pension at retirement is 22% short of what they actually need. That means that someone who wants to earn R10 000 per month when they retire, will actually earn R2 200 less. Would you be able to decrease your income by that much currently?

What’s more, the National Treasury states that only 6% of South Africans are on track to retire with a decent amount of savings. This means that you are most likely not on track! The best way to make sure that you are part of the 6% is to start investing from the day that you start working, even if it is just a very small amount every month.

What happens if I resign?

When you make the decision to leave an employer you have a few options. Generally, people opt to have the funds transferred to the new employer’s retirement fund, but you can also opt to have it paid out or transferred to a preservation fund. The money you withdraw will mean that you can withdraw less from your pension fund when you retire, and with less money for the last years of your life, so it is vital that you make sure you take this into account when you make your decision.

Withdrawal benefits are paid to employees who leave and, often, employees see this as a bonus when changing jobs, but this could have a terrible effect on your retirement years, especially since these benefits are taxed before they are paid out. Protecting your hard-earned retirement savings is the best way to secure your future and a happy life once you’ve retired.

Previous Post

Take a look at Metsi Berries

Next Post

Your paycheck unpacked: Part 2

Next Post
Your paycheck unpacked: Part 2

Your paycheck unpacked: Part 2

Fedgroup-Life-CEO-Walter-van-der-Merwe-Industry-Insights

Insurance will never be the same again

May 8, 2020
Fedgroup Impact Farming Solar Farm

South Africa to have major advantage in the renewable energy space

February 6, 2019
Five reasons that blueberries are superfruits

Enjoy the fruits without farming

October 11, 2018
Blueberry bushes under netting

Blueberries are transforming land use in Limpopo

November 26, 2018
Blueberries

Fedgroup Impact Farming featured in MomTalk

December 19, 2018
Making money out of farming without owning a farm

Bee pollination services: earn income not only from honey

November 28, 2018
solar power on a school in Port Elizabeth

Fedgroup Impact Farming makes a difference in Port Elizabeth

November 26, 2018

Meet our venture partner Emergent

October 30, 2018

How to make your money work smarter for you

November 26, 2018

Your paycheck unpacked: Part 1

June 12, 2019

What you need to know about impact investing

October 4, 2018

Grant Field talks to Brainstorm Magazine

March 1, 2019

10 reasons why honey makes you happy

October 4, 2018

United Exports receives World Development finance to expand operations

February 12, 2019

Agriculture finance – key to expanding commercial farming operations

February 6, 2019

CEO Grant Field talks to eNCA

January 14, 2019
  • Fedgroup
  • About Us
  • Careers
  • Financial Planning
  • Structure
  • Governance & Compliance
  • Contact Us
  • Board of Directors
  • Blog
  • Press Release
  • In The News
  • Promotions
  • Wellness
  • Iteke
  • Wealth
  • Secured Investment (Part Bonds)
  • Property Finance
  • Tax-Free Savings
  • Beneficiary Care
  • Retirement Fund
  • Retirement Unclaimed Funds
  • Unit Trusts
  • Life
  • Group Risk
  • Future
  • Wills
  • Trust
  • Estate Planning
  • Estate Administration
  • Settlement Trusts
  • Ventures
  • Impact Farming
  • FAIS Information
  • Disclaimer
  • Privacy Policy
  • Treating Customers Fairly
  • Conflict of Interest Management
  • Compliants Process
  • General Disclosure
No Result
View All Result
  • Contenthub
  • Editor’s Pick
  • Newsroom
  • Impact Farming
  • Fedgroup
  • Wealth
  • Life
  • Future
  • Ventures