Changing jobs? What to consider when deciding what to do with your Retirement Fund benefit

In addition to joining the gym and spending more time with family, many people will vow to improve their professional lives in the coming year.

Times have changed and people no longer remain with just one company for their entire working lives. Whether you resign to seek greener pastures, take a retrenchment package, or your employer’s pension or provident fund is dissolved, you will be faced with the incredibly important decision of what to do with your retirement savings.

How can you make sure you get the most out of your hard-earned money?

When you exit the Fund, you have the following options:

• You can choose to keep your money invested with the Old Mutual SuperFund Preserver Membership category:

Transferring your benefit to Old Mutual SuperFund Preserver allows you to remain a member of the Old Mutual SuperFund, even though you have left the employer.

As a member of SuperFund Preserver, you enjoy the following benefits:

• You watch your investment grow without having to add more contributions.
• Your retirement savings will stay invested, while you enjoy investment choice and flexibility.
• Should you need to access your cash at some point, you can withdraw your retirement savings at any time.
• Alternatively, you can transfer your retirement savings to another retirement fund — subject to legislation and the rules of the receiving fund at the time of transfer.
• Since your retirement savings have the ability to continue growing, you can take your time deciding what to do with them. This also gives you the time to speak to a financial adviser if you need to.
• You can select your retirement age. You can choose to retire at any age once you have reached your 55th birthday.
• And, if you become disabled before age 55, you may be able to take an ill-health early retirement benefit.
• Note: Certain Evergreen and Evergreen Investment Advice members may not be elligble for this option. Please confirm with your Human Resources department.

• You can withdraw part (or all as applicable) of the benefit amount and use it to buy what you need now:

But taking it in cash means you have to start all over again to build up your retirement savings. The negative effects of this are doubled because you not only lose your capital but the benefits of compound interest which, as we explained, take a long period of time to be beneficial.

Remember, this is the money that you will need to live off when you can no longer work. Will you have enough time to save enough so that when you retire you can maintain the same standard of living.

• You can transfer the retirement benefits to your new Employers Retirement Fund:

This can be done only if you start the new job immediately after ending your service with your previous employer.

• You can transfer the benefits to a Retirement Annuity fund.

The value of your money is preserved, but you can only access your funds as a retirement benefit after your 55th birthday. Although, if you become disabled before age 55, you may be able to take an ill-health early retirement benefit.