March 7, 2017

One of the more interesting trends that has recently emerged from the American retirement space is the practice of employees taking their employers to court over high costs associated with their pension funds. Toy Otto, Head – Employee Benefits Consulting at leading financial advisory group GTC, believes this trend might well find its way to South Africa in due course. “This may have serious consequences for the savings and retirement industry as we know it, if we do not adjust the way we report information back to our members.” Otto believes this is a natural consequence of employees becoming more empowered about their retirement options and rights, and the changes in regulation over the past ten years (as well as draft regulations to be introduced in the near future) which will encourage greater interest in costs and benefits relative to... Read More

An increase in personal income tax rates and the marginal rate of tax for high income earners – which will more than likely be announced in this week’s National Budget Speech – will be a bitter pill to swallow in the short term. However, if this does happen, it will provide a good opportunity to boost long-term retirement savings. This is the opinion of Jill Larkan, Corporate Liaison Executive at leading financial advisory and wealth management business GTC. “Given the country’s growing revenue shortfall and the National Treasury’s limited options for raising income, commentators are expecting that personal income tax rates and the marginal rate of tax will be raised, with high earners likely to be affected the most.” While higher taxes rates might be undesirable, she believes it may bring a silver lining for individuals’ retirement benefits. “An increase... Read More