Taxing the elderly on income they've already been taxed on is criminal. I'd rather dig a damn hole in the ground and bury my savings like a fantasy pirate treasure.
The idea is that you get deductions for the contributions made during your lifetime. You can check out s11F of the income tax act. So you dont get double taxed that hard.
@@danielcillie1856 shouldn't be taxing old people's pensions at all, a person who has a decade or two left to live should be allowed some freedom. Also most of that money at the end goes to medical bills.
@@CptRumcan and then you die and they tax you estate on top of it all. Personally I feel f#ck all personal income tax. Taxing ones willfully given labor is abhorrent.
The question I keep asking myself is what will the purchasing power of the rand be in 30 years? A R600k plus savings pot sounds amazing but in the year 2055 R600k might not even be able to buy you a second hand toyota tazz😂.
We don’t know what the future holds. Remember the elites want to implement universal basic income at one stage, robots may rise too. Jesus may come back, we can’t simply estimate how much things will be 31 years from now
@gustavfourie5099 this comment is gold, you absolute legend! This made me think very very differently about this subject! A 600k Toyota tazz is most definitely a possibility seeing the way a loaf of bread has almost tripled in price over the years.
So now what will happen if you loose a job lets say after this new system, and you can't find anything until your retirement age, how are you going to survive if you can't touch your pension fund.
As far as I understand, you just described the old system. The new 2 pot system now lets you withdraw before retirement age but there are of course T+C's to it
Please explain more about the VESTED pot.... the other pots : Savings Pot + Retirement Pot is understandable. the rights to access n taxes upon resignation, Retirment or retrenchment.
This was an EXCELLENT and EXTREMELY informative video. Thank you! Question; if you were restructured and lost your basic salary and now struggle by not making ends meet since post COVID backlash? So you're still technically employed but barely earning monthly. Do they let you withdraw or do you have to have left the company altogether?
What if one takes one withdrawal and puts it into an RA, would the tax return once a year cancel out the tax sars takes at withdrawal and if one takes the tax return and places it into that RA?
The way i understand seems we starting from scratch saving. Assuming i have 500k then 10% is 50k but only 30k is moved to savings then kedt with 470k is moved to vested pot. Meaning 1st sep savings pot will have 30k then retirement pot will have 0 then goong forward 1/3 to savings then 2/3 to retirement then y dont they allow people to take all vested pot now n settle their debts those who dont want it they leave it there. Another issues is lets say i loose my job by 45yrs n fail to get the job n no funds in vested and savings meaning i will be a hobo waiting for retirement age while i have money in retirement pot. People will loose bonds and houses
Very informative. I have been to a few financial advisors trying to figure out what to do for retirement and none of them were able explain it in the way you have. Makes so much more sense now. Thanks @MoneyMarx
While I understand where this law has come from, I think it will be very short sighted to take from a retirement fund prematurely , kicking the can down the proverbial road
Thank you for another great video. Initially I was convinced withdrawing would be a bad idea but I have recently started thinking about scenarios in which withdrawing would make sense. Regulation 28 often means a bulk of the funds in retirement accounts will be invested in SA and SA has not been a high growth market. In addition to this, the Rand has been depreciating. Would it make sense to withdraw, take the tax hit and then invest the funds in a fund like the S&P 500? The S&P 500 has outperformed the JSE and also you hedge against the Rand depreciation. I am truly curious if anyone has run the numbers on this. I would highly discourage against withdrawing for just spending purposes.
What will impact tax the most is how much you withdraw from savings as the amount will be added to your total annual taxable income. The risk is increasing your total taxable income and then move to the next tax bracket and pay more tax (or owe SARS tax when you file your return). The time you choose to withdraw in the FY doesn’t have an impact.
Hi Marx , quick question, what if you haven’t yet started contributing to a RA , does this mean wait until after the 1st , how will every be split if you start contributing after the 1st ?
Great Video. Good Explanation. You need to account for inflation on projected values in your examples, otherwise you're making the withdrawal option look worse. The fiat ZAR devalues over time, so by the time you hit pensionable age, your money won't be worth anything, or maybe the pension funds will have potentially run out of money. Is there a good retirement withdrawal calculator for South Africans to figure out a sustainable withdrawal rate? I know the 4% rule is quite popular, but is this relevant for South Africans?
Thanks for the video. I have a question, what happens if one has; say two policies? One at work and one privately, will they have four pots? Or everything will be in only two?
Dankie, baie goed verduidelik. Sal dit ook RA's insluit of bly RA's nog op die ou reels van uitbetaaling op aftrede en geen ontrekking tot aftree ouderdom?
What if a person who is over 55 yrs old got fired from their job and doesn't intend to look for another job??? Would they be able to get all their money???
Can you make a video of how rich people avoid tax. I'm interested in company owners who supposedly buy expensive cars to avoid paying tax. Is that a thing? Also how does donating to a charity as a company affect the tax you pay?
With regard to donations to a charity, a company qualifies for a S18A deduction for donations paid to a certified PBO. The deduction is limited to 10% of annual taxable income. (This also applies to individuals if you donate to a charity registered as a PBO).
Nope. As i understand it- max allowed will be R30 k as long as you have > than R300k in "pension savings" . Anything less than that only 10% of total amount in "pension" funds
The PAYE impact on withdrawal from the savings pot needs to be know. The paye on the withdrawal amount is part of the story, these earnings are added to ur annual taxable earnings and create the opportunity to move into a higher tax bracket. The issue with this is most will only discover this change on assessment in July 2025, when they are told by Sars they owe PAYE. This primarily due to payroll taxes only being based on employment related earnings.
True, people should take this into consideration before withdrawing any of their savings because the tax implications are dire. Especially in the case where one moves to the next tax bracket and already majority have limited knowledge of tax. The best case scenario is opting out of withdrawing any of the 1/3 savings or withdrawing just enough to still remain in the same tax bracket.
I thought if you were 55 years or older on March 2021- you could elect Not to go to the 2 pot system.. things would tick along exactly as it did before- no 1/3 going to savings and 2/3 to retirement pot..
Ramaphosa’s economy is killing us, we need to pay those credit cards. We had 3% only raise in the past 4 years and 7% inflation thus having a decrease in our earning of 4%, people may say live below your means now living below our means would mean living in a shack. Withdraw pay off debt or withdraw invest offshore in dollars or RMB, investing in Rands is fully considering the Rand in 2006 was $1/R6 now its around $1/R18. Just dont take the cash to buy a damn TV or partying the weekend away
I want to start investing into the S&P500 but im not sure whether to make it through dollars or through my ZAR TFSA through a feeder? Would appreciate any advice 🙏
Hi money marx I cant seem to get my bank details from wise I already sent money to interactive brokers but I'm having problem sending 300 to activate my wise account could you please help me out and is there any other way to withdraw money back to my sa bank acount
We can't save every year bruv. Cost of living vs salary vs black tax vs recovering from covid... Where must we get more magic money? I'd rather withdraw and buy crypto and retire safer. Just where my 2 pot 2c is going 😂
This is going to hurt the little guy. Imagine losing your job and being told your provident fund balance is R50k but you can only access R5000 and the rest is put away for you to access when you're 55years old. How about i just get my money now and solve my problems now and I will worry about retirement when i actually have a job 🤷🏾♂️
Taxing the elderly on income they've already been taxed on is criminal. I'd rather dig a damn hole in the ground and bury my savings like a fantasy pirate treasure.
What's the interest rate in holes in the ground?
Yea, its laughable
The idea is that you get deductions for the contributions made during your lifetime. You can check out s11F of the income tax act. So you dont get double taxed that hard.
@@danielcillie1856 shouldn't be taxing old people's pensions at all, a person who has a decade or two left to live should be allowed some freedom. Also most of that money at the end goes to medical bills.
@@CptRumcan and then you die and they tax you estate on top of it all. Personally I feel f#ck all personal income tax. Taxing ones willfully given labor is abhorrent.
The question I keep asking myself is what will the purchasing power of the rand be in 30 years? A R600k plus savings pot sounds amazing but in the year 2055 R600k might not even be able to buy you a second hand toyota tazz😂.
We don’t know what the future holds. Remember the elites want to implement universal basic income at one stage, robots may rise too. Jesus may come back, we can’t simply estimate how much things will be 31 years from now
Just saw the price of brown (Sunbake) bread at Shoprite. A whole R18
I told my son by the time he starts working. A fast food burger will cost R300
@gustavfourie5099 this comment is gold, you absolute legend! This made me think very very differently about this subject! A 600k Toyota tazz is most definitely a possibility seeing the way a loaf of bread has almost tripled in price over the years.
@@andrewradloff1282😅
It’s been a while! Great to have you back🎉
He's Back!
Thank you for the explanation. I almost resigned at the end of this month.
Same here
Clear, succinct and informative content, as per the usual from Pieter!
I genuinely thought you were out on other money making opportunities and done with RUclips😂😅 it's been a while , happy to have you back
Baie dankie Money Marx jy maak ons besluite makliker.
You Are a Rockstar ⭐️
Tanks mark...i searched google and and read so many news articles but they werent very clear....now i understand .thanks
Mr. Money Marks our very own financial veterinary professional.. welcome back sir 🙏..
You're a great story-teller, thank you for this valuable information.
Money Marx welcome back
Thank you so Much for this simplified explanation. I am now subscribed to your channel.
Thank you 🙏🏾. This was very well explained.
Well explained 💯
You're back, NICE :)
Loving the Office references!
Insightful, thank you
So now what will happen if you loose a job lets say after this new system, and you can't find anything until your retirement age, how are you going to survive if you can't touch your pension fund.
As far as I understand, you just described the old system. The new 2 pot system now lets you withdraw before retirement age but there are of course T+C's to it
I currently resigned at my job,I was told that I can only access my funds when I'm 55 because it's a Group Retirement Annuity
Great video🤙🏻
This is a great explanation... thank you so much
Thank you for sharing insight on TWO POT SYSTEM.
Thank you, much appreciated!
Nice presentation with a tad of humour. Thank you...
Please explain more about the VESTED pot.... the other pots : Savings Pot + Retirement Pot is understandable.
the rights to access n taxes upon resignation, Retirment or retrenchment.
What will happen to the Vested pot after 1 September 2024? Will I be able to withdraw from this pot in 2025 or 2026?
Very informative. Thank you sir
Thoughts on what will happen to the Stock market during/after the two pot systems.....
This was an EXCELLENT and EXTREMELY informative video. Thank you! Question; if you were restructured and lost your basic salary and now struggle by not making ends meet since post COVID backlash? So you're still technically employed but barely earning monthly. Do they let you withdraw or do you have to have left the company altogether?
Welcome back!
Thank you very clear and precise. Il be very interested in the videos about different types of pension vehicles.😊
What if one takes one withdrawal and puts it into an RA, would the tax return once a year cancel out the tax sars takes at withdrawal and if one takes the tax return and places it into that RA?
Clever goverment ... this is easy way to increase cash flow , reduce debt and the bonus of all that tax money to " use "
The way i understand seems we starting from scratch saving. Assuming i have 500k then 10% is 50k but only 30k is moved to savings then kedt with 470k is moved to vested pot. Meaning 1st sep savings pot will have 30k then retirement pot will have 0 then goong forward 1/3 to savings then 2/3 to retirement then y dont they allow people to take all vested pot now n settle their debts those who dont want it they leave it there. Another issues is lets say i loose my job by 45yrs n fail to get the job n no funds in vested and savings meaning i will be a hobo waiting for retirement age while i have money in retirement pot. People will loose bonds and houses
What is a non-vested account?
Thanks for information really appreciate it, however there is 3rd scenario which depends on the non-traditional financial education.
Very informative. I have been to a few financial advisors trying to figure out what to do for retirement and none of them were able explain it in the way you have. Makes so much more sense now. Thanks @MoneyMarx
Thank you for this🙏
Mr money marks
If i resigned on the 1st September will i get all my money from the vested pot
While I understand where this law has come from, I think it will be very short sighted to take from a retirement fund prematurely , kicking the can down the proverbial road
Thank you for another great video. Initially I was convinced withdrawing would be a bad idea but I have recently started thinking about scenarios in which withdrawing would make sense. Regulation 28 often means a bulk of the funds in retirement accounts will be invested in SA and SA has not been a high growth market. In addition to this, the Rand has been depreciating. Would it make sense to withdraw, take the tax hit and then invest the funds in a fund like the S&P 500? The S&P 500 has outperformed the JSE and also you hedge against the Rand depreciation. I am truly curious if anyone has run the numbers on this.
I would highly discourage against withdrawing for just spending purposes.
Thinking of that too
I want to know what happens when i resign especially with the vested pot? After the 1st of september
Can you talk about the tax and how it affects tax bracket, if its for the tax year and if it’s wise to take in February as the FY ends February.
What will impact tax the most is how much you withdraw from savings as the amount will be added to your total annual taxable income. The risk is increasing your total taxable income and then move to the next tax bracket and pay more tax (or owe SARS tax when you file your return). The time you choose to withdraw in the FY doesn’t have an impact.
Thank you so much for this video 💖 when you resign after 1 September will you not be able to cash out at all ?
Hi Marx , quick question, what if you haven’t yet started contributing to a RA , does this mean wait until after the 1st , how will every be split if you start contributing after the 1st ?
Great Video. Good Explanation.
You need to account for inflation on projected values in your examples, otherwise you're making the withdrawal option look worse. The fiat ZAR devalues over time, so by the time you hit pensionable age, your money won't be worth anything, or maybe the pension funds will have potentially run out of money.
Is there a good retirement withdrawal calculator for South Africans to figure out a sustainable withdrawal rate? I know the 4% rule is quite popular, but is this relevant for South Africans?
Will the vested pot be accessible on resignation after 1 september 2024 as is the case now?
GOD BLESS YOU BROTHER !
I am not touching a cent 🤗
What about your vested pot, are you allow to take it, when resign or change jobs.
Thanks Captain!
Can you pay back the 30k on a later stage if you are able to do so
Does this in anyway affect Living Annuities for people who are already retired?
Thanks for the video. I have a question, what happens if one has; say two policies? One at work and one privately, will they have four pots? Or everything will be in only two?
I have provident fund, if I leave my company before the 1st September will I take my entire provident fund ?
Dankie, baie goed verduidelik. Sal dit ook RA's insluit of bly RA's nog op die ou reels van uitbetaaling op aftrede en geen ontrekking tot aftree ouderdom?
Hello, if I retire today. Will I not be affected by the new system?
I have plans for my provident
No you will not. Everything carries on as normal
Baie Dankie Boet.
What if a person who is over 55 yrs old got fired from their job and doesn't intend to look for another job??? Would they be able to get all their money???
Yes
Very good 🎉❤
Government has a simple reason- money in their pockets.. this R30k is taxed
.
I wonder why tax it again as it's a form of relief to the poor. 🤔🤔
Wow, how did we allow this?
Can you make a video of how rich people avoid tax. I'm interested in company owners who supposedly buy expensive cars to avoid paying tax. Is that a thing? Also how does donating to a charity as a company affect the tax you pay?
With regard to donations to a charity, a company qualifies for a S18A deduction for donations paid to a certified PBO. The deduction is limited to 10% of annual taxable income. (This also applies to individuals if you donate to a charity registered as a PBO).
Buying an expensive car to avoid tax is still a bad idea.
Are security personnel also fall under this new system
Yes…
The 2-pot system applies to any South African who has a pension fund, provident fund, retirement annuity, or preservation fund.
Portfolio update please
The R 30,000 that can be withdrawn from the Vested pot, is this per RA (I have 3 RAs). Does this mean I can withdraw R 30,000 from each RA?
Nope. As i understand it- max allowed will be R30 k as long as you have > than R300k in "pension savings" . Anything less than that only 10% of total amount in "pension" funds
Good question as the different companies will not know about the other pensions you have
Lekker video, thanks!
It’s been a while Mr Money Marx ❤
The PAYE impact on withdrawal from the savings pot needs to be know. The paye on the withdrawal amount is part of the story, these earnings are added to ur annual taxable earnings and create the opportunity to move into a higher tax bracket. The issue with this is most will only discover this change on assessment in July 2025, when they are told by Sars they owe PAYE. This primarily due to payroll taxes only being based on employment related earnings.
True, people should take this into consideration before withdrawing any of their savings because the tax implications are dire. Especially in the case where one moves to the next tax bracket and already majority have limited knowledge of tax. The best case scenario is opting out of withdrawing any of the 1/3 savings or withdrawing just enough to still remain in the same tax bracket.
I thought if you were 55 years or older on March 2021- you could elect Not to go to the 2 pot system.. things would tick along exactly as it did before- no 1/3 going to savings and 2/3 to retirement pot..
Understood 🎉
Was the public informed about this bill before it was signed off by the president?
i love the Michael Scott or should I say Michael Scarn reference. #theofficefan
We just paying off that loan they took during covid-19(500 bill)
What if I'm close to retirement, will qualify for R30K. I have debt. Would it be better to take the R30k (less tax) to pay off high interest debt?
You have to calculate the tax on the R30k and compare to the interest in order to determine which one is favourable.
No rather start paying of youre debt like credit card debt
Ramaphosa’s economy is killing us, we need to pay those credit cards. We had 3% only raise in the past 4 years and 7% inflation thus having a decrease in our earning of 4%, people may say live below your means now living below our means would mean living in a shack.
Withdraw pay off debt or withdraw invest offshore in dollars or RMB, investing in Rands is fully considering the Rand in 2006 was $1/R6 now its around $1/R18.
Just dont take the cash to buy a damn TV or partying the weekend away
Frikie at the brai 😂😂😂
I think the only way this works is to withdraw savings primarily to pay off debt. Debt is always growing faster than investment.
Bro's eyes are beautiful
I want to start investing into the S&P500 but im not sure whether to make it through dollars or through my ZAR TFSA through a feeder? Would appreciate any advice 🙏
Dollars the rand is not a stable currency for investors
If the rand keeps on weakening, investing in dollars is better as your capital gains tax will be lower
There is a presidential election coming up in the USA
Hi money marx I cant seem to get my bank details from wise I already sent money to interactive brokers but I'm having problem sending 300 to activate my wise account could you please help me out and is there any other way to withdraw money back to my sa bank acount
Why they don't make it 50 50
Clarify on 26.67%tax.
Hey bro this was by far the most informative of the videos on this subject on RUclips! I've subscribed
Politicians should get zero pay. Then the citizens will be served correctly
Please school me on this.
The amount of people that are going to end up homeless after retirement because of this is terrible.
Ill just withdraw once... need to fix my car lol.
Jy's 'n Stêr🎉
This is the worst and most selfish idea insurance companies have ever come up with so far🚮😫
Hey Marx , I’d love to design a free thumbnail for your next video. No strings attached. Would you be interested?
The basic salary of a normal South African only covers basic needs. can't afford to save.
Frikkie by die braai 😂...klink my Frikkie was al by jou braai ook. Aai Frikkie. 😂
We can't save every year bruv. Cost of living vs salary vs black tax vs recovering from covid... Where must we get more magic money?
I'd rather withdraw and buy crypto and retire safer. Just where my 2 pot 2c is going 😂
This is going to hurt the little guy. Imagine losing your job and being told your provident fund balance is R50k but you can only access R5000 and the rest is put away for you to access when you're 55years old. How about i just get my money now and solve my problems now and I will worry about retirement when i actually have a job 🤷🏾♂️
Baie insiggewend.
Toyota Corolla Pandemic? 🤣
😂😂😂scams youll never see that money
No the main reason is employers pay LIKE SHIT / Don't give Pension benefit. Kak country.
Very informative, thank you 🙏