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Thread: Retirement fund transfer

  1. #1
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    Retirement fund transfer

    I am 56 and was retrench. As I received an severance package and plan to do some consulting work, I want to delay my pension for at least 18 months or even longer if possible. The retirement fund decline my request to transfer my pension account to a preservation fund or a retirement annuity. They say as I am older than 55 I have to take a monthly pension income. Therefore the funds can only be transfer to a retirement instrument that gives me a pension income immediately and can not delay it.

    They quote me the following:
    Employees older than 55, will not be able to take all the money from the XXX Retirement Fund as a cash payment (like a resignation). The Pension Fund act prescribes that employees older than the age of 55, must go on pension (therefore receive a monthly pension) or that the pension credit been transferred into an external retirement instrument Annuity to be paid out as a monthly pension. In cases where the pension credit gets paid into an annuity or the pension gets paid as a monthly pension salary, the one third can be paid out, tax free until a maximum of R315,000.

    Are there any rules, regulation or act (pension fund or tax) that prevent me from preserving my pension beyond the age of 55?

  2. #2
    Site Caretaker Dave A's Avatar
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    May I suggest you ask them for the applicable section of the Pension Funds Act.
    Seeing opportunity changes nothing. Seizing opportunity and running with it changes lives.

  3. #3
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    The only way they can impose that is if you have signed an employment contract that stipulates a retirement age, then you can legally be required to retire at that age. If you haven't signed such thing then they can't tell you when to retire and what to do with your money. What is the retirement age on the fund and what are the rules of the fund?
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