“This [a blended living annuity] provides the best of both worlds allowing for the important aspects of the living annuity, with its legacy, income flexibility and market participation; and the with-profit annuity with its income security that ensures your income if you die, even well into the future” says John Anderson, head of research at Alexander Forbes in Bruce Cameron's most recent DAILY MAVERICK op-ed.
News and Media
Change your living annuity, not your drawdown rate
National Treasury announced a change in living annuity drawdown restrictions where pensioners will be allowed to temporarily adjust their drawdown rate to as low as 0.5% or as high as 20%, even if it is not the anniversary date of the living annuity. But current market conditions present a unique opportunity to improve the sustainability of your income in retirement despite the recent market movements. And this does not require you to reduce your drawdown rate. To take advantage of this opportunity, you may want to consider some choices for your retirement income.
Hybrid annuities: Something to consider when choosing your pension
“Hybrid annuities will help to optimise the pension benefits to balance the competing objectives pensioners face. Hybrid annuities provide a sustainable income on the one hand, versus having flexibility for unforeseen events and the ability to leave an inheritance on the other,” says John Anderson in Bruce Cameron's DAILY MAVERICK op-ed on hybrid (blended) annuities.
[Related article: HYBRID ANNUITIES: SOME OF THE CHOICES]
Life annuity sales soar amid lockdown losses
Amid the market instability brought on by COVID-19, retirement income specialist Just has reported record demand for life annuity solutions from South African pensioners looking to lock in an income for life. Sales for life annuities have doubled relative to 2019 since the COVID-19 market crash in mid-March 2020. CEO Deane Moore attributes this growth to attractive annuity rates and pensioners seeking to de-risk their retirement income in an unpredictable financial climate.
Alternative ways to structure a pension
In his latest op-ed for DAILY MAVERICK, Bruce Cameron says that the best way to overcome the disadvantages of living annuities and guaranteed annuities is to use both. This becomes even more important with COVID-19 and the downgrading of South Africa’s credit rating.
Clearing up the confusion about annuity products
PERSONAL FINANCE clears up some confusion regarding annuities, including converting from a living annuity to a life annuity. Just's Segabe Ditodi contributes to the article and provides insight into the broader process.
What if I’m about to retire and my savings are low?
If you are within about five years of retirement and your savings have taken a hit with the recent market falls, there are some things you need to think about, writes Laura du Preez in a recent SowetanLIVE article featuring Just CEO, Deane Moore.
Lockdown learnings for retirement
A volatile financial climate has seen many South African pensioners in living annuities looking to increase their withdrawals to cover current cash shortages. However, retirement income specialist Just advises strongly against this, recommending instead that they find ways to trim their spending, or else they run the risk of their money drying up sooner.
The tricky balance between retirement earnings and death benefits
Bruce Cameron has written a series of articles for the DAILY MAVERICK dealing with some of the pros and cons of guaranteed annuities versus living annuities. Our CEO Deane Moore features in his latest article on retirement earnings and death benefits, and aims to clear up some misperceptions surrounding guaranteed annuities and leaving a legacy.
Living Annuity vs Death Benefits: A tough balance
The more income you require from an investment-linked living annuity the less the death benefit you will receive. As one goes up, the other goes down. What that means is that benefits for heirs are seldom achieved. A DAILY MAVERICK op-ed explores the complexity of living annuity investments from Bruce Cameron, and why it is recommended to seek financial advice.
How to sustain your pre-crash retirement income
Life annuity rates have increased by 10-15% since the beginning of the year, which offsets the reduction in market values most people in or close to retirement have experienced in the recent market crash. In other words, you’re currently able to get a higher income from each Rand of your retirement capital if you invest it in a life annuity today than you were three months ago – in fact 10-15% higher. However, this window of opportunity won’t last forever.
The dichotomy between what pension scheme members want and what they get
A regular contributor to the DAILY MAVERICK, Bruce Cameron says: "Most living annuity pensioners had already received a serious body blow even before the virus and the downgrade of South Africa’s debt, with many already having high drawdowns. Despite this, 90% of South African pensioners want living annuities on which to retire, while at the same time research undertaken by Sanlam and Just SA finds that 87% of retirees want security of income."