JOHANNESBURG - Financial pressure is pushing more South Africans to access their two-pot retirement savings, but the rising cost of living is not the only factor influencing the decision.
New research suggests mental health challenges and gambling may also be playing a role in how people manage their finances, with South Africans in their 30s emerging as the age group experiencing the greatest financial strain.
According to Discovery, withdrawal patterns are relatively consistent across age groups, but people between the ages of 30 and 40 appear to be accessing their retirement savings at a slightly higher rate.
Guy Chennells of Discovery says there could be several reasons for this.
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“There are multiple factors going on.”
While younger South Africans may be more affected by mental health challenges, Chennells says the financial pressures facing people in their 30s are often more complex.
He says this is the stage of life when many people begin taking on significantly higher expenses, from housing and childcare to education and other household costs.
Chennells says this may explain why the 30 to 40 age group appears to be the most financially stressed.
“In the 30 to 40 age group, if you think about it, that’s the age at which you are really starting to incur massive additional expenses that you didn’t previously.”
He says most people were using the money to service debt and meet day-to-day living expenses.
Read more: Surge in two-pot withdrawals sparks Treasury’s plan to allow access to locked savings