Here are some of the most commonly asked questions we receive from members:
Q. When I retire, will I receive an income directly from the Fund?
A. No, when you reach retirement age you have the option to purchase a single-life, joint life or a living annuity from the financial institution of your choice.
Q. At what age can I retire?
A. Normal retirement age is 60.
Q. I am considering resigning and I am looking at ways of investing my benefit. Do you have any advice on what the best investment options are for me?
A. It is important that you consult a financial advisor regarding investment decisions. They will be able to provide you with guidance on which investment vehicle would best suit your individual needs. If you do not have an advisor of your own, you may contact the helpdesk on 021 421 0190 should you want us to set up an appointment for you with a Metropolitan / Momentum Financial Advisor.
Q. What is my pensionable salary?
A. To calculate your contributions, we use your pensionable salary. This is the portion of your salary on which your monthly contributions to the Fund are calculated on.
Q. I would like to save more towards my retirement. I have worked extra shifts and want to pay extra money into the Fund. Is it possible to do so?
A. Yes, you may make additional voluntary contributions to the Fund. Please inform your employer of the amount you would like to pay extra per month and they will arrange with the administrator. Contributions up to 27,5% of the higher of your pensionable remuneration or taxable income (subject to a maximum of R350 000 per tax year) are tax free. This applies to the total of the member’s employer and employee contributions to all pension funds, provident funds and retirement annuities.
Q. If you look at the funeral benefit, are same sex partners included under the spouse cover?
A. Yes, same sex partners as well as “common law” spouses are included.
Q. What does the word, repatriation mean?
A. All members have repatriation cover under the Family Assistance Benefit. Repatriation means that, when someone dies, they are transported to the place they wish to be buried. Your Fund offers this benefit to you and your immediate family within the borders of South Africa.
Q. If I need an urgent loan, can I borrow from my Fund?
A. The Fund issues surety for home loans only. The loan can be used for housing purposes only and your employer has to enter into agreement with the bank before you can apply. This service is offered through Standard Bank at the moment. It is important to remember that it is not a direct loan against your Fund. You have to pay the home loan back to the bank each month and the loan is ALWAYS subject to the Bank’s approval and interest.
Q. What is a non-mortgage home loan?
A. It is a loan that is issued by the bank for housing purposes and does not require bond registration.
Q. Once I receive the loan can I spend the money however I like?
A.No, you can only use the money to purchase property, pay transfer fees, settle an existing bond or to pay for renovation to your property (you must be the homeowner).
Q. Can I make a direct loan against my Fund Credit?
A. No, the Fund may not, in terms of the Pension Fund’s Act, allow direct loans. The Fund only issues surety for the loan amount, once it has been approved by the bank.
Q. What loan amount can I apply for?
A. The minimum amount you can apply for is R3000. If you are younger than 50 you can apply for a maximum loan of 60% of your Fund Credit. If you are 50 years and older, you can apply for a maximum of 30% of your Fund credit.
EXAMPLE: Mr. Joe Bob is 40 years old and his Fund value is R100 000 and this is the first time he is applying for a loan. The amount the Fund will therefore be able to issue surety for will be R60 000.
Q. Do I automatically qualify to receive the loan if I have enough money in the Fund?
A. No, the loan is subject to the banks approval in terms of the National Credit Act. This means the bank will look at your credit record and whether you can afford to take out the loan. Your employer also has to be a participating employer in the housing loan scheme.
Q. Do I have to repay the loan or is it deducted from my Fund Credit when I end service?
A. You will have to repay the loan. The amount will be deducted by your employer from your salary in monthly instalments and paid to Standard Bank. The maximum repayment period is 10 years.
Q. Which bank does the Fund deal with and can I make use of any other bank?
A. The Fund has an agreement with Standard Bank only and will not be able to issue surety for loans through any other banks.
Q. How do I apply?
Step 1: You need to confirm whether your employer has an agreement with the bank as they will be responsible for deducting the loan instalment from your salary.
Step 2: Contact the Help Desk who will be able to provide you with the surety amount (maximum amount you can apply for).
Step 3: You will then be required to complete the application form and submit the supporting documents at the Help Desk.
Step 4: The Help Desk will then submit your application form to the bank.
Step 5: Standard Bank will contact you directly to advise whether your loan has been approved, if yes, the money will be paid directly into your bank account.
Q. What are the supporting documents that must accompany the application?
A. Copy of your ID, proof of address, latest payslip, three months’ bank statements, quote for the work you want to have done (renovations) or Offer to Purchase (if purchasing property), marriage certificate (if married in community of property).
Q. What happens if I end service and the loan has not been paid in full?
A. The Fund will obtain the settlement amount from Standard Bank and deduct this from your benefit, before making payment to you.