A preservation fund is a fund into which retirement fund benefits may be transferred and preserved when a member of a pension or provident fund terminates his services (but does not retire), or when a fund is dissolved in terms of section 28 of the Pension Funds Act, No. 24 of 1956.
The Sanlam Plus Preservation Fund prioritises the preservation of members’ benefits when leaving a retirement fund as it’s critical to ensure that their benefits at retirement are sufficient to purchase a sustainable pension.
There are many reasons to choose the Sanlam Plus Preservation Fund to preserve your retirement benefits. Some of the key benefits include:
The minimum requirement for a new member to belong to the Fund is an initial transfer from an approved fund to the value of R25 000. This minimum amount is not applicable on any subsequent transfers from an approved fund to the Fund. Read moreBenefits from a pension fund can only be transferred to the Sanlam Plus Pension Preservation Fund and benefits from a provident fund to the Sanlam Plus Provident Preservation Fund.
The retirement date is 70 years but members are permitted to retire early – from age 55 and onwards.
Members’ retirement benefits consist of an annuity policy purchased with the member’s share. Members may convert the benefit or part thereof to a lump sum payment. Members, who belong to the Sanlam Plus Pension Preservation Fund, may only convert a maximum of one-third of the retirement benefit to a lump sum.
A member’s retirement benefit becomes payable if the member, in the opinion of the Board, becomes permanently incapable of carrying on his or her occupation due to sickness, accident, injury or incapacity through infirmity of mind or body.
The member’s share in the Fund is payable when he or she dies. The death benefit is payable in the form of an annuity policy purchased with the member’s share. Dependants or nominees may request to convert the benefit or part thereof to a lump sum payment. Read more
The Trustees determine the distribution of death benefits due to beneficiaries of deceased members in terms of Section 37C of the Pension Funds Act, No. 24 of 1956. Where the Trustees are of the opinion that it would not be in the interest of a minor beneficiary that his or her benefit be paid to his or her parent or guardian, the benefit may be paid to a registered beneficiary fund.
The Trustees have approved the use of the Sanlam Trust Beneficiary Fund as well as the Legacy Beneficiary Fund. The Board of Trustees will only be able to pay the benefits allocated to minor beneficiaries into a trust in very limited circumstances, for example where the member has nominated a trust to receive the benefits on behalf of the minor.
A member may apply to make one preretirement withdrawal (for each transfer made into the Fund) from the Fund at any date before the retirement date, provided the rules of the transferring fund do not prohibit this. Read moreThereafter a member will not be allowed to make another withdrawal before the retirement date, or disability or death. Such withdrawal is not deemed as retirement and is taxable according to the withdrawal tax table of the Income Tax Act.
The Trustees have approved a range of institutionally priced investment portfolios, including smoothed bonus, single manager and multi-manager investment options.
The Sanlam Plus Preservation Fund is managed by a Board of five trustees – three of them are appointed by Sanlam, and two are elected from a panel of suitably qualified industry professionals who are independent of Sanlam. A Principal Officer supported by a Fund Secretariat manages the day-to-day operations and ensures compliance with regulatory requirements.
The appointed administrator of the Fund is Sanlam Life Insurance Limited. Sanlam Corporate, a division of Sanlam Life Insurance Limited, is responsible for the administration of the Fund and maintains the records of each member, and processes and settles all exit benefits payable to members.
The Fund’s operating expenses comprise the following:
Administration fees cover the cost of administering the Fund. No initial administration fee is payable, but please note that the administration fees do not include the investment management fees charged.
Consulting fees to financial advisers are only payable upon agreement between the member and his or her financial adviser.
The Contingency Reserve Account is used to pay expenses related to the following: FSCA levies and fees, fidelity insurance premiums, actuarial services, audit services, independent trustee expenses, member communication expenses, and other fees and disbursements.
Administration fees and the Contingency Reserve Account are subject to review at any time with a three month written notice period of any changes.
For a comprehensive overview of all operating expenses, including investment management fees, please download the Sanlam Plus Preservation Fund guide.
We recognise that appropriate communication is key to assisting members in taking control of their finances, and to help ensure good retirement outcomes.
The Fund has a formal communication strategy in place, and our aim to ensure that members are educated on all aspects related to their retirement so that they may make informed decisions regarding their retirement planning and savings.
Members can contact a financial adviser, or make contact in any of the following ways: