The Important Role of Retirement Benefit Counselling

Retirement Benefit Counselling is a critical — and often underutilised — part of retirement planning. It’s a legal requirement in South Africa that all retirement fund members receive counselling before withdrawing or retiring from their fund.

Why is it important?

1. Informed Decision-Making
Counselling ensures you understand your options when retiring, resigning, or changing jobs. It helps you make better choices around:

• Taking a lump sum vs. transferring to another fund
• Tax implications
• Annuity choices
• Estate Planning Implications (i.e. what happens to your funds upon your death)

2. Avoiding Costly Mistakes
Without guidance, many members withdraw their entire retirement benefit as cash, unaware of the long-term financial consequences. Counselling helps you protect your retirement capital.

3. Understanding Your Rights
You learn about:

• How your retirement fund works
• What benefits you’re entitled to
• What steps to follow for a smooth exit

4. Customised Advice
Although retirement benefit counselling is not financial advice, it provides clear, factual information tailored to your retirement fund. This empowers you to then engage with a certified financial planner to make holistic, personal financial decisions.

5. Better Outcomes
Research shows that members who receive counselling make more prudent long-term financial decisions and enjoy greater peace of mind at retirement.