As we near 1 September 2024, we are examining the readiness for the new legislation, known as the two-pot system, which will impact members of retirement funds. This system presents both opportunities and challenges, as it allows for flexibility in accessing funds for immediate financial needs while also ensuring funds are preserved for retirement.

Here are some points to consider when withdrawing:

• Firstly, assess your financial needs, and determine the amount you need to withdraw and how it fits into your overall financial plan. Consider the impact on your long-term savings retirement plan.
• Consider tax implications: Understand how withdrawals will be taxed. Your savings pot withdrawal will be subjected to your marginal income tax rate, and SARS will levy penalty interest (IT88) on any tax arrears.
• Evaluate fees: Check for any transactional fees associated with withdrawing from the savings pot. Different administrators may have different rules regarding withdrawal fees.

To read more on the two-pot system and withdrawals, click here.

In this month’s edition, we shift the focus to cybersecurity awareness as the majority of the administrators will allow members to process their withdrawals online under the two-pot system, indicating a significant shift towards digitisation in the retirement fund management system. This modern approach within the industry will offer convenience and efficiency.

Since most of the online systems will be self-service, administrators have aimed to create user-friendly platforms; however, it is important to attend educational campaigns or engage with communications to understand how to access and navigate these tools.

Cybersecurity measures are a priority, as it is paramount to protect your data against breaches, fraud, and unauthorised access, given the sensitive nature of financial and personal data.

A proactive approach to security when protecting your personal information is a combination of vigilance, good practices, and utilising available tools.

Tips you can take to safeguard your personal information:

1. Secure Your Device: Use a strong passcode, biometric authentication (fingerprint or facial recognition), or both to lock your phone. – Enable automatic locking after a short period of inactivity.
2. Secure Personal Information: Keep sensitive documents in a safe place. Shred documents that contain personal information before discarding them.
3. Use Strong, Unique Passwords: Use complex passwords that include a mix of letters, numbers, and symbols. – Avoid using the same password across profiles and devices. Consider using a password manager to store and generate secure passwords.
4. Update Software Regularly: Keep your phone’s operating system and apps up to date to protect against vulnerabilities. Regularly back up data; you may use cloud services or other secure methods to back up important data in case of device loss or damage.
5. Use Secure Connections: Avoid accessing sensitive systems over public Wi-Fi. Use a VPN to secure your connection if necessary. Use cell phone data for secure transactions instead of public Wi-Fi.
6. Enable Two-Factor Authentication (2FA): If available, enable 2FA on accounts related to the system to add an extra layer of security.
7. Be Cautious of Phishing Attempts: Be wary of emails, texts, or calls requesting sensitive information. Verify the sender’s identity before responding. Avoid clicking on links or downloading attachments from unknown sources. Limit the amount of personal information you share on social media.
8. Monitor Financial Statements: Regularly review bank and credit card statements for any unauthorised transactions. Set up alerts for suspicious activity on your accounts.
9. Use Trusted Apps: Download apps only from official app stores (Google Play Store, Apple App Store). Check app permissions and only grant necessary ones.
10. Monitor App Permissions: Regularly review the permissions granted to apps and revoke any that are unnecessary for their function.
11. Use Security Software: Consider installing a reputable security app to protect against malware and phishing.

Remember to monitor for suspicious activities continuously. Staying alert for potential scams and seeking professional financial advice is crucial for making informed decisions that align with your financial goals and prevent you from falling prey to scams.

Tips sourced from www.experian.com.