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Half of South Africans are unprepared for retirement

Technically, 49% have no pension plan – and women are less prepared than men.
The glimpse into what poverty feels like for many during the pandemic may finally convince people they cannot afford to ignore planning for retirement, says Chris Eddy of 10X. Image: Shutterstock

South Africa is sitting on a ticking retirement timebomb, with National Treasury saying that in 2019 only 6% of the country’s population was on track to retire comfortably.

Chris Eddy, head of investments at 10X Investments – which released its third annual Retirement Reality Report on Wednesday – said the Covid-19 pandemic has highlighted the urgency needed to tackle the retirement savings crisis.

The report is based on findings of the 2020 Brand Atlas Survey, which tracks and measures the lifestyles of the 15.1 million economically active South Africans living in households with a monthly income of more than R8 000 (through online surveys).

The report revealed that South Africans do not retire with dignity and there is seemingly little sign of improvement, as 49% of people surveyed said they don’t have a retirement plan; last year it was 46%.

How South Africans are saving

Source: 10X Investments Retirement Reality Report 2020

Women are the worst when it comes to saving, with 53% saying they don’t have a retirement plan.

Source: 10X Investments Retirement Reality Report 2020

The key reasons

The report states that many South Africans will face a bleak reality after their working lives come to an end.

“A frightening number of people have not formally planned how they will fund their retirement. Of those who have, few are monitoring their progress.

“Most don’t know whether or not they are on track to meet their goal to be able to support themselves in retirement, never mind in any comfort.”

Another reason for South Africans not saving for their retirement is because there is simply not enough money to live a decent life and save.

“Some of this is down to economic hardship. It is simply impossible to save without a minimum level of income,” according to the report.

“This year more than half of the survey’s respondents indicated severe financial stress.”

Beyond that, it is not just an income issue, because people in low-, medium- and high-income brackets are equally worried about making ends meet in retirement.

The report indicates that it is rather a savings problem that is rooted in the widespread lack of retirement planning.

“[Of those] who do have retirement saving plans, dangerously few are monitoring their progress. Most don’t know whether or not they are on track to meet their goal to be able to support themselves in retirement, never mind in any comfort.”

The last hope

Eddy said the silver lining is not obvious, as the data paints a picture of the population sailing blindly into a worsening crisis.

The coronavirus pandemic might however have helped drive the message home, with Eddy saying that there is a possibility that some lessons may have been learned as sudden lifestyle downgrades became a reality for many.

“If there is to be a positive from our state of economic and financial disaster, perhaps it is the increased awareness of our vulnerability to life’s unexpected broadsides,” he said.

He said that the glimpse into the future of what poverty feels like for many may finally convince people that they cannot afford to ignore planning for retirement.



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The most precious possession all of us can have, except for family, is your health. I frankly see no reason to stop working if you’re healthy. Start a business, do consulting work, whatever. The reason I’m saying this is that pension returns are so poor and administered prices are rising so quickly, that even a guy who’s contributed to his pension fund all his working life simply cannot afford to stop working at 60.

Agree. And based on medical evidence (the web is full of it) the lack of brain activity among the elderly, are one of the reasons for earlier onset of Alzheimers, Dementia, and more.

‘If you got your health, what else matters?’ – Basil Fawlty

Absolutely agree

In time the Comrades will lay their paws on prescribed assets to bail out an ailing State machine..Until the piggy bank is empty!

Would emigrating to a country (let’s say Australia for example) while in your 20’s improve your chances of living a decent life with a better saving potential for retirement? Just curious.

Possibly. But it’s a much more complex answer than just a simple “Yes” or “No” as there are dozens of factors to consider.

However the short answer in just the general terms are, life in a 1st world country is better than in a 3rd world country, in terms of most metrics.

Just a side note with regards to Australia. Have a look at some of the news coming out of the country around all the lockdowns and especially look at the state of Victoria. It’s basically turned into a police state. Freedoms in both Australia and New Zealand are being eroded faster that you can imagine. Even some of the big mainstream media houses like Sky News Australia has reported on it extensively.

“Never trust a politician, they’re not your friend” – Big Daddy Liberty

….good observations

My brother in his late 40’s got in on his wife’s credentials; he has his articles so he’s qualified to work, however CA’s are not in demand as they once were

His first job was a delivery driver

Just before the Chinese flu, he started a small logistic company with two vans. He is making it despite the headache of indecisive politics


I don’t imagine that the 40m Americans working two jobs to survive will agree that life is great in the first world

Granted, same family prob is safer and has some decent level of health care.

All the world is hopelessly skewed between the have’s and the have-nots.

Respectfully, you’d need to be in Australia to know what is going on.

It’s true that Victoria is draconian like none other (I’d personally never live in Melbourne for a host of reasons including a labour government) but it’s a federation and it’s different whereever you go. Like the US – can’t compare NY and Texas.

I’m in Northern NSW, have worn a mask twice (once for a COVID test and one when I went to the vet). Cops here are very chilled. Ride around with bikes, no helmets – in other places, cops are all over that. Really depends on where you live and fortunately, the country is resaonably large.

Finally I’d say that I’d take an over-bearing police force in a safe country over violent third world country on the edge of a financial cliff with zero prospect of change. Respectfully


I think so. Go and try it out in Oz, and lets us know. (You will have “I told you so” responses from us 😉

What is worse: to be attacked/mugged in your old age within South Africa by angry, riotous, and misinformed youths OR being kicked in the groin by a ‘Roo?

Had good laugh now… Remember that dude Robert from Sydney who made such weird comments…

Yes, Robert is not missed at all

Its not just your retirement savings you need to look at. Its also what a particular country will give back to you once you retire. eg in the US you get social security and healthcare after you retire. might not be the greatest but its pretty substantial.
Social security could be as much as $3k per month per person. Thats like a husband and wife living off the interest of a R20 Mil investment. I doubt any 3rd world country provides that to their citizens.

Now this is the type of response I was looking for. Informative. And Makes sense.

I’d rather choose a country with low taxes and make my own path. If you work hard, a lower tax country is better than a high tax country. If you are middle class, a higher tax country is probably better.

SA is neither of those, high taxes and you get nothing, so most countries will be an improvement in that case. SA has got low cost of living if you’re a high earner or can earn foreign income. Few countries offer the same property space for your income, but most countries won’t affect you as much on crime.

Probably would as first world countries tend to make things work

Take Japan for instance. The youth are taught to have the utmost respect for the elderly and they are taken care of

It shows in their society as they’re a respectable and respectful nation

Only the Elite, corrupt and civil servants in SA will prosper on the other hand

Lockdown case in point. They all earned salaries for doing “zip”

Many are still in slow motion taking “laid back” to a whole new level

Speaking from first hand experience, I would say that moving to Australia is a good move especially if you have something that you can offer Australia and are prepared to work hard to get ahead. You get value for your tax dollars and the first $18000 (R200k) is tax free. The median salary in WA is about $80000pa. Schooling is free and the kids get HECS to study at uni (soft loans). No excuses for not being what you could be. Corrupt polies get roasted. Home invasions and murders are rare. In general it’s very safe. Many doctors are “bulk billing” meaning you don’t pay (Medicare). State hospitals are free. You pay though your taxes. Many have private health (hospitals). GST is 10%. Cars and insurance is cheap. Pension is something the government gives to you. Superannuation is like a pension fund that you own yourself. You accumulate this fund while working (employees contribute about 10% of your gross salary to your fund). You take this with you when you move jobs i.e. it is independent of the employer. If you start out in your 20s you can accumulate a couple of million AUD by the time you retire. The earnings (dividends and interest) from the fund are tax free for retirees.

Stuff like groceries ($300 per week), car registration ($800 pa) and houses ($600k for a mediocre 4 BR house in WA on 500 square meters) are expensive. Melbourne (avoid) and Sydney houses much more expensive but other capital cities or country towns are cheaper. Interest rates are really low. Kids have too much money ($20 hour) working at fast food joints or shops. Can be a problem with drugs freely available although the police are very draconian.

Let’s put it this way as someone who left for Oz. Easily the best decision I’ve made by a long way.

People here are quite lazy and complacent which makes it ripe for opportunity to advance your career rapidly.

It’s a meritocracy, no BEE or other arbitrary barriers.

My wife is in marketing, has more in her Super (pension equivalent) after 2 years than she did in 8 years working in SA. I’m in real estate and had 2 job offers competing for me within weeks of entering the job market….never happened before.

Of course COVID has changed the economic landscape but I can say categorically that opportunities here are INFINITELY GREATER than anything in South Africa for anyone. It’s truly up to you what you make of your life here – live a chilled, modest life or hustle to the top.

The short answer is YES.
I have 4 family scattered over Aussie, all doing better than in SA financially., fully assimilated and not even interested in coming to SA for a holiday.
The 2 in USA (Seattle and Houston) have become very wealthy (both doctors)
The one in the UK has done exceedingly well in HR.
With the ANC’s racist policies, you as a white person will never be sure of your job.
f you have the chance and the means, get out before you or your family are killed.

….while the most wealthy “captains of industry”….

(too many to mention here…Bill Gates, George Soros, Warren Buffet, Jeff Bezos, Mark Zuckerberg…and our own Christo Wiese, Patrice Motsepe, Johann Rupert, Nicky Opperheimer, Koos Bekker ete etc)

….seems to “fear” retirement the most (despite that many are able to retire decades ago even).
NONE OF THEM you’ll catch “sitting on the stoep reading a book” until the Grimm Reaper arrives.

NO. It’s a sense of self-worth thing.

The super uber wealthy do not “retire”. Retire to them means expired/uitgedien.

But it’s dictated upon you & I, that we should plan for our retirement…err, our “period of expiry”.

Makes sense?

Those lucky people are doing what they love. Unfortunately, not everyone loves what they do, or gets paid for doing what they love.
So it pays to have some ‘expiry’ insurance. While no one can be forced to retire from work, most people are forced to retire from their employer’s payroll.

‘If you got your health, what else matters?’ – Basil Fawlty

Been savings since I was an intern grossing R5000pm. Putting in 12.5% into an RA. When I made perm I juggled it so the company pension and the RA still give me the 12.5%. Funny thing is right now, actually before covid, I have less in the RA than I have put in. Hopefully this so called magic of Compound interest will kick in at some point. It’s been years now. And no, I am not going to switch managers because we all know that under Reg. 28 everyone pools funds in the same basket.

…I have called my RA a “krimp fonds” despite monthly contributions. (…yes, the company is not the problem…my Momentum, Old Mutual & Liberty RA’s have performed equally poorly.)

And everywhere you look they own Malls, high rises, etc, etc, what a scam a lot of us have fallen for all our lives! These companies have more Human behaviourist and phsychology skill than financial and economic skill thats for sure!

The miracle of compound interest has a fugly cousin called compound fees. And she, she is a real Bitch

Compound real losses – I have the same problem. Stopped the RA contribution and took the tax knock and put it offshore. So far has been worth it. Plus exchange rate gains only count as a capital gain not an income.

Hardly a surprise with 30%+ unemployment.

compared to Sydney (5 Million people) with a < 4.0 % unemployment rate.

I'd like to see an unemployment distribution at a provincial level in our country.

40% plus

What’s in a number, when very few actually WANT to work in SA!?

South Africans over 60: We understand delayed gratification.
South Africans under 60: No, we want instant gratification.

Therein Khande lies the truth : Rerettably the under 60,s now seem to think that the Over 60,s Who did plan their retirement , should fund the under 60,s who did not !!!

I’m sorry, the person doing the charts, you do realise there are more colours than blue, ja? Come om, man!

…to be fair, I did notice the color Black is also used in the charts. Surely is does Matter?

The chart’s contents seems ‘fine and normal’ to me.

The best retirement plan is to first pay of your debt, and only then to think of which ponzi scheme to invest in.

Up until the 1960’s and 1970’s people retired at 65 and passed on by the time they were 70,there was no problem. If you made 75 your money probably ran out. With people now living 10 years longer they should only be retiring at 75,there lies the problem.

the pension fund ponzi of first world countries will come to a head someday. Perhaps they’ll import just enough young workers to keep carrying the tax burden. Watch the Laffer curve of Western Europe and social/pension obligations in action.

If we could be taxed a little less we may be able to save a little more. If you don’t save it is your veld.

The combination of the income tax, the dividend tax, company tax, municipal tax, VAT, Fuel levies, CGT, estate duties, BEE requirements, cadre-deployment and the inflation tax imply that it is mathematically impossible to prepare for retirement. The government steals your purchasing power faster than you can build it.

All of us are investing in the socialist ANC government who forces us to do so by decree. We are buying our own social grant. We are slaves to a socialist regime.

I am still waiting for any one of these large company surveys to point out the role of Regulation28 on the poor returns on retirement funds. Most pension funds have not beaten inflation over 5-7 years, not due to savers not saving enough, but because of the poor growth partially caused by REg28 and only 30% offshore exposure. I have many clients who took their money offshore ten years or so ago who lead fantastic lives, as their investments have been growing by 20-30% per annum, versus 5-8% on the local market.
I have battled in vain to see any spokesperson of any retirement company who dared to criticize Reg28. It’s a career-ending move.

Sorry Magnus, but to get to 30% compound annual over a decade those clients did not buy products, they bought a tiny hand full of stocks – Apple, Netflix, Amazon, Tesla. No sane advisor would have selected that basket in 2010 and no responsible advisor would (after an 11y bull run) place their client funds there now with valuations at all records on any measure you choose.

For facts : the S&P after a 11y record bull run returned 13% – before fees. Maybe 10% after fees

You’re wrong Johan, the S&P index has returned 30% per year in Rand terms over the last 7 years.
Sep 30 2013 -S&P 1756 zar 10.05
Oct 22 2020 -S&P 3450 zar 16.22

That’s a return excluding dividends of 217% or 31% pa

And just to add, if you go back 10 years you get a whopping 58% pa

Piet : it probably returned 5000% or ten brazilian % in zim dollars, but as a dollar equity index all that matters is the dollar return. What, measured return in Swiss Franc is 6% so now it is bad investment?

Come on Johan, don’t come here with facts – All these fund managers sell their book, Magnus is no different

Depending on the likes of OM for a trouble free retirement will leave you like a fish on dry land 15 years down the line.

And who is to blame here?
Can only be the Government 100%.

Investors and companies ran away after they saw the massive looting and corruption.

South Africans can only save for retirement if they have excess cash left over after providing for the basics in order to stay alive.

We learnt to live day by day like the rest of the impoverished world.

End of comments.



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