The design of the fund

The PetroSA Retirement Fund is a Defined Contribution arrangement. 

This means that each month the Fund receives a contribution which is then allocated for your retirement savings. These contributions grow with the net investment return (which may be positive or negative) earned on the portfolio where you elect to invest your money. There is a separate guide titled your Investment choices dealing with your investment choices in the Fund. 

So, the amount that you will have available for your retirement will depend on two factors, namely: 

  • The contributions that have been set aside for you as retirement savings; and 
  • Most importantly, the net investment returns the Fund earns on this money. 

Other than your retirement benefits, the Fund also provides benefits on your resignation, retrenchment and death. Separate insurance policies provide disability income benefits; spouse’s death benefits for members of the Fund and funeral benefits.

The Fund is also approved for tax purposes as a Provident Fund, which means that you can elect to receive your retirement and death benefits as any combination of a lump sum and/or pension. However, this law may be changing by 2019. 

The contributions paid to the Fund are split into three components, namely: 

  • Your Member Individual Account - it is into this account that contributions allocated for your retirement savings are channeled. 
  • An Expense Contingency Reserve Account that finances the costs of the Fund.  

Your Member Individual Account is equal to the sum of:

  • All employer contributions made towards your retirement; plus
  • Any amounts transferred into the Fund from a previous Retirement Fund; plus 
  • Any amount credited as a result of any surplus apportionments, plus
  • Investment returns earned on all these amounts.