Is South Africa ready for retirement
Johannesburg - As we approach the 4th Annual PPS Retirement Summit, set for 26 October 2024 at The Campus in Bryanston, South Africa faces a stark reality: millions of citizens are simply not ready to retire. This year's theme, "Next Chapter, Best Chapter," takes aim at the pressing issue of longevity, retirement readiness, and the changing definition of retirement itself.
With life expectancy in South Africa steadily increasing, the retirement landscape is evolving. According to recent studies, the average South African is now living to around 65 years and beyond, pushing the boundaries of what it means to financially sustain a long and fulfilling post-work life. Yet, despite this longer life expectancy, as many as 60% of South Africans are not financially equipped to retire comfortably, with many over the age of 60 still facing the grim reality of having to continue working just to make ends meet.
The two-pot retirement system, currently being rolled out, offers some hope, allowing individuals to save a portion of their retirement funds for short-term needs while protecting long-term savings. However, this alone may not be enough. The 2024 PPS Retirement Summit invites professionals and retirees alike to rethink traditional notions of retirement and to embrace "longevity literacy"—an essential skill that will empower individuals to make informed, strategic decisions about their financial futures.
A Call to Action: Retiring Well in the Age of Longevity
As guest speaker and respected economist Professor William Gumede will highlight, the issue is not simply about putting money aside, but about understanding how long that money needs to last, and how to make the most of it. The reality is that South Africans need to save far more than they currently do, with many experts suggesting saving 15% to 20% of one's income to secure a stable retirement. Yet, statistics show that the average South African saves less than 7% of their annual income, which is a major concern.
Maxwell Mojapelo, Executive of PPS Investments, will offer insights into how professionals can leverage tools like the two-pot system and other long-term savings products to bridge the gap. "Living longer should be celebrated, but it also requires us to approach retirement planning differently," says Mojapelo. "This summit is about giving people the tools to make sure the next chapter is their best chapter yet, no matter where they are starting from."
Redefining Retirement: It's Not Just About Stopping Work
In today's world, retirement is no longer a single event, it's a transition. Professor Bonang Mohale will explore the need for redefining what retirement means in the 21st century, and how individuals can continue to create meaning, purpose, and income well into their golden years. With more retirees choosing to re-enter the workforce or pursue passion projects, the next chapter of life is increasingly becoming a blend of leisure and productivity.
While the challenges are undeniable, the PPS Retirement Summit aims to shift the narrative from one of financial stress to one of empowerment. "We want to help South Africans understand that they can take control of their financial destinies. It's not too late," says Johan Gouws, Head of Advice at PPS.
As South Africa grapples with the complexities of retirement in a world where people are living longer but saving less, the PPS Retirement Summit offers a vital opportunity to take charge of the future. Retirement is no longer an end, but a chance to begin a new chapter, one filled with purpose, fulfilment, and financial security. With the right tools, knowledge, and mindset, the "next chapter" can truly be your best chapter yet. This is the moment to take bold steps toward mastering longevity, and to ensure that no matter how long you live, your retirement years are lived well.
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