HEARD street on the
Nearly 50% of pensioners have too little to live on
The 2016 Sanlam Benchmark Survey has found that only 35% of pensioners believe they have saved enough for retirement, while a staggering 48% experience a shortfall between income and living expenses each month.
Viresh Maharaj, chief marketing actuary at Sanlam Employee Benefits, believes that this undersaving for retirement is partly due to a lack of advice. Three out of every four pensioners interviewed said that they had only received financial advice within 10 years of retirement, and 32% only became aware of their retirement benefits five years before retirement, which gave them insufficient time to supplement retirement savings, if necessary.
Maharaj says that the lack of advice is also apparent when it comes to preserving funds and that “55% of pensioners interviewed admitted to withdrawing their benefits in full during the course of their working lives. At least 38% of the survey group revealed that they were unaware of the long-term effects of withdrawing the money, and an astounding 48% regret withdrawing it. The importance of preservation must be stressed to members by both employers and advisers early in the retirement-planning journey.”