![]() Where we were industry-specific, we’ve actually taken our scope beyond the mining industry, and we’ve converted to a fund where other employers, other industries, can also participate in the fund.Īnd the way that we manage the fund is basically on a mutual society basis. World Finance: So how would you say the industry is developing, and what is Sentinel doing to address the challenges?Įric Visser: We have transformed our fund. Why is this? And what impact has this had?Įric Visser: People argue, ‘Why should I make provision for retirement, but before I get to retirement I might starve of hunger?’ That is the main issue that sits behind it.Īnd people are saying, you know, it has been postponed, but I think we have to overcome that problem. World Finance: Well let’s look at the retirement reform initiative now and there are obviously high hopes for this, but then it’s been postponed a year, and possibly two years. You know: get people out of their debt, let them preserve for their retirement, for old age. Obviously, once we’ve solved that, we need to get to preservation. World Finance: So does the sector face any other challenges, maybe in terms of social security?Įric Visser: The big challenge is to solve the unemployment problem. And secondly, because people are indebted to such a large extent, they tend to withdraw their retirement savings just to keep alive. So what sort of impact does this have on the industry?Įric Visser: First of all, obviously the unemployed don’t provide for retirement. World Finance: Well as you mentioned, South Africa is plagued by a high rate of unemployment, and many people are in debt. It’s only the employed, and because of our unemployment rate, those people aren’t participating in it. It’s well-regulated, but it’s got a small net. And the retirement industry is no different. World Finance: And how developed would you say it is in terms of transparency?Įric Visser: South Africa rates among the top in the world when it gets to financial discipline, governance, compliance, and obviously transparency. So, you know: the majority of people in South Africa are actually dependent on that. ![]() The state pays for them, and it’s about $80 a month. And then you’ve got the state old grants, which is a social pension. Obviously the unemployed, they’re got no retirement dispensation. And they’re normally defined-contribution based.Īnd then you’ve got the other one, which is commercial retirement annuity funds, which are for the self-employed, the informally employed, and for small businesses. You’ve also got large private funds, which are normally the outflow of bargaining councils, and they’re industry specific.Īnd those three dispensations are obviously for the employed, and they’re compelled to belong to those funds that are offered by their employer. ![]() Secondly you’ve got commercially administered stand-alone funds. You’ve got your commercial umbrella funds. So Eric, the South African retirement industry: how is it structured exactly?Įric Visser: Well currently we’ve got quite a few dispensations. With me is Eric Visser from Sentinel Retirement Fund to talk about how they are shaping the industry. However, new innovative policies are starting to drive growth. World Finance: The South African retirement industry is still in its infancy: with low economic growth and the high inflation environment hindering development. Sentinel Retirement Fund CEO Eric Visser tells World Finance how the industry is addressing these challenges. The information provided is for educational and informational purposes only and is not intended, nor should it be interpreted, as an offer, solicitation, or recommendation to purchase or sell any security mentioned.South Africa’s retirement reform initiative has been postponed, but the country must still address its unemployment problem. All information has been obtained from sources believed to be reliable, but its accuracy is not guaranteed. Sentinel Benefits & Financial Group and its affiliates do not provide tax advice. Sentinel Benefits & Financial Group is the brand name for the Sentinel family of companies which includes Sentinel Benefits Group, Inc., Sentinel Pension Advisors, Inc., Sentinel Insurance Agency, Inc., and Sentinel Securities, Inc. Investment brokerage services offered through Sentinel Securities, Inc. Insurance products offered through Sentinel Insurance Agency, Inc. are separate, unaffiliated companies that are not responsible for each other's services and products.įinancial planning and investment advice are offered through Sentinel Pension Advisors, Inc., an SEC registered investment advisor. ![]() Sentinel Benefits & Financial Group and eMoney Advisor, LLC, Broadridge Investor Communication Solutions, Inc., and Zywave, Inc. © 2023 Sentinel Benefits & Financial Group, All Rights Reserved.
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