Alexforbes-logo

AFRIS helps you navigate your retirement and get where you need to. It finds the best route and vehicle to get you there, helping you deal with obstacles along the road, and providing expert advice every step of the way

START YOUR JOURNEY WITH AFRIS

Scroll down
trackertrail
Tracker Image

Watch
How AFRIS helps

View
What sets AFRIS apart

Play
 Test drive AFRIS

View
Important milestones

View
How to choose AFRIS

Where it starts

Where it starts

Alexander Forbes Retirement Income Solution

AFRIS helps navigate life’s moments to keep your retirement savings on track.

For many people, retirement seems a distant destination, with the road to retirement feeling both long and unfamiliar. Harsh economic climates, present-day financial obligations, and a lack of understanding as to how much – or even
how – to save, lead many of us to take a hit-or-miss approach to our own financial futures. However, with the Alexander Forbes Retirement Income Solution (AFRIS), your journey to retirement can be better planned and
much smoother.

The Alexander Forbes Retirement Income Solution (AFRIS) is included as part of your retirement benefit offering. This means that you can choose to enjoy all of AFRIS’ benefits to supplement your existing retirement savings.

AFRIS is a holistic retirement income solution that’s a blend of both products and services. It is a bundle of products, including living annuity, unit trust, retirement annuity fund, preservation pension fund and preservation provident fund, all which offer savings and a wide range of
portfolio options.

It allows you to keep all your retirement savings in one place, for greater visibility and control. Crucially, it allows you to stay invested in these products, even if you leave your employer, and continue enjoying preferential rates and benefits. It also gives you access to expert advice to help you make the most of your available funds. It is a companion at every stage of your life journey, ensuring your current convenience and future comfort.
Top up your retirement

Retirement Top-up

Retirement Annuity Fund

Top up your retirement and make full use of your tax benefits

A retirement annuity is available to anyone. You can use the AFRIS Retirement Annuity Fund to supplement your existing employer retirement fund in your individual capacity.

The AFRIS Retirement Annuity Fund helps you save more by allowing you to top up your savings on a regular basis or as a lump sum.

It also lets you keep all your retirement savings in one
cost-effective place, and easily check if you’re on track to reach your retirement goal. You can also retire later by deferring your retirement and continuing to contribute, which allows you to build up more savings. All of this helps you to make the most of your tax benefits.

View
How the Retirement Annuity Fund works

View
Your Retirement Annuity Fund benefits

View
How the Unit Trusts work?

View
What are your benefits?

Keep investing. Stay on track

UNIT TRUST

Adjust your savings and investment strategy along the way to make the most of your funds

A unit trust is a form of a collective investment scheme constituted under a trust deed. It pools investors’ money into a single fund, which is managed by a fund manager.

The Discretionary Income Product allows you to invest in a unit trust wrapper that carries no administration fees. You must have one of the other products in order to invest in this unit trust.
Getting income in retirement

Staying invested

Preservation Funds

Preserve what you’ve saved for the road ahead

How much you save during your working years can make a huge difference to the financial resources you have available to you on retirement. The longer you can invest for, the better your chances of having enough when you retire. The biggest mistake most people make is cashing in their retirement savings when they change jobs. The AFRIS Preservation Fund allows you to keep your savings invested or preserved when leaving your employer.

The AFRIS Preservation Fund should be considered if you’ve resigned or been retrenched. It’s also a good option to consider if you’ve recently received a benefit or a divorce order and wish to transfer this tax free to protect your savings. The AFRIS Preservation Fund also provides you with a way to protect your retirement nest egg if you’re joining a new fund and don’t want to preserve in-fund. This is because you can use the fund as an external preservation option, which allows your assets to remain outside your current employer fund.

One major benefit of this fund is that it allows you to make one withdrawal from the fund, regardless of whether you’re employed, before retirement. On employer funds, you can’t make any withdrawals while you’re still employed by
that employer.

Keep your savings on track throughout your career A pension fund or provident fund is provided by your company. It is a means for your employer to assist you in saving for retirement, and carries tax benefits. Typically, you and your employer will both contribute to the fund, and typically you have to leave the fund if you leave your employer. However, the AFRIS Preservation Fund allows you to continue enjoying all the fund benefits, even if you leave your current employer. This means you’ll enjoy a seamless saving journey throughout your career.

View
How the Preservation Fund works

View
Your Preservation Funds benefits

View
Living Annuity or Life Annuity

View
Living Annuity combines best of both

View
How does the fund work?

View
Your Living Annuity benefits

Keep investing. Stay on track

Retirement income

Annuities

AFRIS Living Annuity
Ensuring enough savings to get you to your retirement destination

You look forward to a comfortable retirement after years of working hard. However, most retirement plans require you to make one more hard choice before allowing you to settle into your new leisurely life: namely, whether you want the security of a guaranteed income, or whether you want the flexibility to invest your hard-earned savings for the benefit of your beneficiaries. The AFRIS Living Annuity gives you the best of both. Our solution combines the benefits of a living annuity with a guaranteed life annuity, allowing you to leave a legacy for your beneficiaries, while providing you with a guaranteed income.

Portfolios & Fact Sheets
Click to view

Advice

Just as you wouldn’t start off on a long journey without first filling up your tank and plotting the route, you shouldn’t go on your retirement journey without proper financial advice. Financial advisers can help you select the best product for your specific needs, and help you adjust your savings and investment strategy along the way to make the most of your funds. It’s important to consult a knowledgeable and experienced financial adviser whenever you encounter a financial obstacle or life milestone.

The value of AFRIS lies not only in its market-leading products, but also in its wealth of expertise and advice that it offers throughout your financial journey. Financial advisers are experts in their field and gather information that is relevant for making good decisions. They can help you assess your needs and make appropriate recommendations.

© Alexander Forbes 2024. All rights Reserved.

Brochure Download

Alexander Forbes Contact Centre

Telephone: 0860 66 4444

Fax: +27 (0)11 263 1227
Email:
GlacierInstructions@alexforbes.com
Physical address:
Alexander Forbes,
115 West Street,
Sandown, 2196
Postal address:
PO Box 787240,
Sandton,
2146

Head Office
 Telephone: +27 (0)11 269 0000
Fax: +27 (0)11 269 0149
Physical address:
115 West Street, Sandton
Postal address:
PO Box 787240, Sandton, 2146
Play Video

AFRIS

What sets
AFRIS apart?

Cost savings and flexibility

You can enjoy these cost-effective solutions for a lifetime, as each one is designed to meet your different life stage needs. Our solutions are priced competitively, similar to pricing levels paid by retirement funds. Individual member products are more often costed at retail pricing which is much higher than the costs that retirement funds pay. This benefit allows you the ability to access AFRIS products at lower costs for as long as you remain in the products.

You can look forward to a seamless savings journey throughout your working lives. This ultimately improves your chances of achieving a better retirement outcome. Our solutions cater for all aspects in your life journey. With consolidated reporting you can view your full investment portfolio in one place and have access to advice at
any point.

You can consolidate all your retirement assets into one solution. The more assets you add to the solution, the lower your admin fee. Admin fees are calculated on the value of your total assets held which results in lower fees for you. You can only transfer in your investments from pre-retirement products. This will then allow you to access our unique living annuity solution.

IMPORTANT SAVINGS MILESTONES AFRIS HELPS YOU NAVIGATE

YOU START SAVING FOR RETIREMENT

It’s time to determine your retirement
destination, and how to get there.

Consider the AFRIS Retirement Annuity Fund to optimise tax. It is flexible and allows you build up your retirement savings at a pace you are comfortable with.

EVERY TAX SEASON

See if you’re making the most of your retirement savings for the year.

Using the AFRIS Retirement Annuity Fund you can optimise tax and consolidate savings. Did you know that you might qualify for a refund on your tax paid when contributing to an RA?

WHEN YOU CHANGE EMPLOYER

Make good decisions about what to do with your retirement savings.

Consider the AFRIS Preservation Fund. This allows you to keep your savings for retirement intact and consolidate any other savings you may have accumulated.

IF YOU ARE RETRENCHED

Make decisions on your savings that keep your retirement plan on track, and allow you to manage your finances during uncertain times.

Consider the AFRIS Preservation Fund and the AFRIS Retirement Annuity Funds and benefit from continuity in your saving. Severance benefits, leave payouts and other after tax amounts could be invested into the unit trust to be your emergency savings account which you can easily access when needed.

AT IMPORTANT FINANCIAL MILESTONES (marriage or the birth of a child)

Life happens and having a savings plan that is flexible and easy to access allows you to enjoy every twist and turn in the road.

Reviewing your financial plan is always important. Using our unit trust, you can save for unforeseen emergencies and towards your unique goals. This ensures that your retirement savings are kept intact for their purpose – your retirement.

WHEN YOU RETIRE

Get help to make good financial decisions to ensure you’re on track to reach your retirement destination.

Consider the AFRIS Living Annuity. You will benefit from the lower pricing, and it also allows you the flexibility to combine a guaranteed income with a flexible investment.

AFRIS

How to
choose AFRIS

How does AFRIS fit in?

Your employer approves AFRIS as part of their retirement benefit offering.

You become a member of your employer’s fund and are saving towards retirement.

You can choose to use AFRIS to enhance your retirement savings.

AFRIS RETIREMENT ANNUITY FUND

How does the fund work?

Your investment in the fund

The money held in the fund for you is called your fund credit. It comprises:

  • Any amount you transfer into the fund from an approved retirement fund, plus all contributions you make to the fund, plus investment returns (positive and negative returns)
  • Administration, advice and investment fees, deductions
    according to pension law, and fund expenses.

Contributions

You can contribute money monthly or top up as and when. Money must be paid into the product’s bank account or collected by once-off and monthly debit orders. Payments over R1 million cannot be made by lump sum debit order and must be paid by direct deposit. The money will only be invested after the bank has cleared it and the completed forms are received.

You can choose to have your monthly debit order collected on the 1st, 15th or 25th of each month or the next business day if these dates fall on a weekend or public holiday.

Please note that investments must meet the minimum amount requirements that apply at the time of your contribution. You may contribute R30 000 as a lump sum, or make monthly contributions of R500.

Investment portfolios

There is a variety of investment portfolios available. The portfolios available are offered by Alexander Forbes Investments Limited. You can choose to invest in a maximum of five investment portfolios from the list. You can also switch portfolios.

Risk

You should seek professional financial advice before making important financial decisions, as you carry the investment risk, and are responsible for the choice and review of your investment portfolio. Good advice is especially important as investment portfolios do not provide guarantees. This means your investment may grow or shrink, so it’s important for you and your adviser to monitor your investment with your long-term strategy in mind.

If you need assistance, contact your financial adviser.

Who may act on your behalf?

Instructions from you, or people you’ve authorised to act on your behalf, will be accepted. These people are referred to as authorised persons. These can be legal guardians, curators, trustees of insolvent estates, and agents by power of attorney.

You must notify the administrator in writing if you no longer want instructions from your authorised persons to be accepted.

THE AFRIS RETIREMENT ANNUITY FUND

What are your benefits?

If you retire from the AFRIS Retirement Annuity Fund

You can retire from the retirement annuity fund from age 55. You can use your full fund credit to buy a pension (a compulsory annuity that will pay you an income for life), or you can take out one third of your fund credit as a cash lump sum. The remaining two thirds must then be used to buy a pension. However, if you have less than R247 500, or an amount stipulated by law, you may take out the full benefit in cash.

Benefit tax

The tax on the benefit is:

  • Determined by the tax law applicable at the time
  • The same whether you retire as the result of disability before age 55 or after age 55
  • Calculated according to special tax tables or cash lump sums
  • Calculated according to the normal individual tax tables for income received from compulsory annuities
A compulsory annuity or pension is a benefit paid by an insurer, usually monthly, and includes a living annuity. You can also retire before age 55 if the trustees are satisfied, based on medical evidence, that you are permanently disabled. You may have to pay tax if you take cash from the fund when you retire.

UNIT TRUST

How the
unit trust works

Your investment in the unit trust

The money held in the unit trust comprises:

  • Any amount you contribute to the product and investment returns (positive and negative returns).
  • Admin, advice and investment fees are deducted from your unit trust.

Contributions

You can contribute money monthly or top up as and when. Money must be paid into the product’s bank account or collected by once-off and monthly debit orders. Payments over R1 million cannot be made by lump sum debit order and must be paid by direct deposit. The money will only be invested after the bank has cleared it. You can choose to have your monthly debit order collected on the 1st, 15th or 25th of each month or the next business day if these dates fall on a weekend or public holiday.

Please note that investments must meet the minimum amount requirements that apply at the time of your contribution: You may contribute R30 000 as a lump sum, or make monthly contributions of R500.

Investment portfolios

There are a variety of investment portfolios available. The portfolios available are offered by Alexander Forbes
Investments Limited.

You can choose to invest in a maximum of five investment portfolios from the list. You can also switch portfolios. Note that disinvestments can incur capital gains tax. You’ll pay income tax on income earned while invested.

A collective investment scheme portfolio is a pool of assets bought with money from a group of investors, and is commonly referred to as a unit trust.

Risk

You should seek professional financial advice before making important financial decisions, as you carry the investment risk, and are responsible for the choice and review of your investment portfolio. Good advice is especially important as investment portfolios do not provide guarantees. This means your investment may grow or shrink, so it’s important for you and your adviser to monitor your investment with your long-term strategy in mind.

If you need assistance, contact your financial adviser.

Who can act on my behalf?

The fund will accept instructions from you, or people you’ve authorised to act on your behalf. These people are referred to as authorised persons. These can be legal guardians, curators, trustees of insolvent estates, and agents by power of attorney. You must notify the administrator in writing if you no longer want the fund to take instructions from your authorised persons.

AFRIS UNIT TRUST

Your unit
trust benefits

You can make regular or discretionary withdrawals from a unit trust.

Security cession

You can transfer your investment as security for any of your debts.

Outright cession

You can transfer your investment by way of an outright cession.

If you pass away

Who will your investment be paid to?

Your investment will be paid to your estate and will then be distributed in terms of your Will.

THE AFRIS
PRESERVATION FUND

How the Preservation Fund works

Your investment in the fund

The money held in the fund for you is called your fund credit. It comprises:

  • Money transferred from other funds, plus investment returns (positive and negative returns)
  • Administration, advice and investment fees, deductions according to pension law, and fund expenses.

Investment portfolios

The trustees keep a list of investment portfolios for you to choose from. The portfolios available are offered by Alexander Forbes Investments Limited. You can choose to invest in a maximum of five investment portfolios from the list. You can also switch portfolios. Please note that your investment must comply with pension law limits and exchange control regulations.

Risk

You should seek professional financial advice before making important financial decisions, as you carry the investment risk, and are responsible for the choice and review of your investment portfolio. Good advice is especially important as investment portfolios do not provide guarantees. This means your investment may grow or shrink, so it’s important for you and your adviser to monitor your investment with your long-term strategy in mind.

If you need assistance, contact your financial adviser.

Who may act on your behalf?

The fund will accept instructions from you, or people you’ve authorised
to act on your behalf. These people are referred to as authorised persons.
These can be legal guardians, curators, trustees of insolvent estates, and
agents by power of attorney.

You must notify the administrator in writing if you no longer want the fund
to take instructions from your authorised persons.

THE AFRIS
PRESERVATION FUNDS

What are your benefits?

If you retire from the AFRIS Preservation Pension Fund

You can retire from the Preservation Pension Fund from age 55. You
can take out one-third of your fund credit as a cash lump
sum. The remaining two-thirds must then be used to buy
a pension. However, if you have less than R247 500, or an
amount stipulated by law, you may take out the full benefit
in cash.

If you retire from the AFRIS Preservation Provident Fund

Were you 55 or older on 1 March 2021?

You can withdraw part or all your retirement savings in
cash when you retire. However, you can’t do this if you transfer to another fund after 1 March 2021.

Were you younger than 55 on 1 March 2021?

For the amount you have saved before 1 March 2021,
you can take it all it in cash. For the amount you have
saved after 1 March 2021, you must use two-thirds to
buy a pension and take the rest in cash.

A compulsory annuity or pension is a benefit paid by an insurer, usually monthly, and includes a living annuity. You can also retire before age 55 if the trustees are satisfied, based on medical evidence, that you are permanently disabled. You may have to pay tax if you take cash from the fund when
you retire.

If you withdraw

You can make a full or partial cash lump sum withdrawal for each transfer benefit as long as you comply with the following:

  • The restrictions that the transferring fund may have placed on your right to make a withdrawal.
  • If you choose a partial withdrawal, you won’t be able to make another withdrawal until your retirement, transfer to another approved retirement fund, or your death.

Withdrawals are taxable, and tax is cumulative over an individual’s lifetime.

If you transfer out of the fund

Subject to the rules of the fund, you can transfer your savings to another approved pension or provident fund, preservation fund, or retirement annuity, or a combination of these allowed by the South African Revenue Service. Following your written request, the value will be transferred.

If you pass away

If you’re a member of the fund at the time of your death, the trustees will distribute your fund credit according to pension law. This law requires that the trustees must:

  • Consider who your dependants and nominees are
  • Decide a fair basis for sharing your fund credit
  • Consider how to pay those who have been allocated a share

AFRIS LIVING ANNUITY

First, some background on living annuities

If you transfer out of the fund

A living annuity is a financial product that pays you a regular income. You can choose between two types of annuities, a living annuity and a guaranteed life annuity. The differences are shown in the table below.

TRADITIONAL GUARANTEED LIFE ANNUITY

Guarantees an income and pays a
pre-determined amount every month
for the rest of your life

TRADITIONAL LIVING ANNUITY
 

Investment product where you carry the risk of your investment losing value, and not lasting your entire life

No flexibility in terms of amount paid

You can choose the amount you are paid, subject to regulations. You choose your income between 2.5% and 17.5%

If you die early, an income can be
paid to a joint life such as your
spouse. However you may not pass
any money on to your beneficiaries if
you die.

Beneficiaries may inherit any remaining funds after your death
As a member of any pension fund, retirement annuity or preservation pension fund, you must use at least two thirds of your savings to buy a living annuity. The other one third may be taken out in cash. This is a legislated requirement. The only exception to this rule is where your savings amount to less than R247 500.

In that case, you are allowed to take out your entire savings in cash. With a preservation provident fund or provident fund you may elect to buy a living annuity with a portion or the full benefit. If you need help, you can contact your financial adviser.

Although the law allows you to draw between 2.5% and 17.5% of your money each year, it’s important to draw your income sustainably so that it will last you throughout your retirement.

YOUR AGE AT YOUR LAST BIRTHDAY

INCOME WITHDRAWAL AS A PERCENTAGE OF YOUR MONEY HELD IN A LIVING ANNUITY

Under 60

4%

60—64

4.5%

65—69

5%

70—75

5.5%

Over 75

5.75%

It’s extremely important to note that these percentages are merely a guideline. You need to consider your personal circumstances and should always consult with a financial adviser before making important financial decisions.

AFRIS LIVING ANNUITY

First, some background on living annuities

How the AFRIS Living Annuity combines the best of both

The AFRIS Living Annuity offers you the security of a guaranteed life income, and the opportunity to grow your savings too:

TRADITIONAL GUARANTEED LIFE ANNUITY

Guarantees an income and pays a predetermined amount every month for the rest of your life

TRADITIONAL LIVING ANNUITY

Investment product where you carry the risk of your investment losing value, and not lasting your entire life

AFRIS LIVING ANNUITY

You can enjoy a guaranteed income by investing a portion of your retirement assets into a life annuity component, JuLi* (treated like an investment portfolio within the AFRIS living annuity) as well as receive an income based on the remainder investment value.

*JuLi is short for Just Lifetime

No flexibility in terms
of amount paid

You can choose the
amount you are paid,
subject to regulations.
You choose your income between 2.5% and 17.5% of the fund value.

You can choose the amount you are paid in keeping with regulations
If you die, an income can be paid to a joint life such as your spouse. However, you may not pass any money on to your beneficiaries if you die after your guarantee period.
Beneficiaries may inherit any remaining funds after your death.

Your beneficiaries may inherit any remaining funds from the living annuity after your death.

Although the law allows you to draw between 2.5% and
17.5% of your money each year, it’s important to draw your
income sustainably so that it will last you throughout your
retirement.

As a member of any pension fund, retirement annuity or preservation pension fund, you must use at least two-thirds of your savings to buy a living annuity. The other one-third may be taken out in cash. This is a legislated requirement. The only exception to this rule is where your savings amount to less than R247 500. In that case, you are allowed to take out your entire savings in cash. With a preservation provident fund or provident fund you may elect to buy a living annuity with a portion or the full benefit.

If you need help, you can contact your financial adviser.

AFRIS LIVING ANNUITY

How does the fund work?

Your investment in the fund

The money held in the fund for you is called your fund credit.
It comprises:

  • Any amount you transfer into the fund from an approved retirement fund Investment returns (positive and negative returns)
  • Administration, advice and investment fees, deductions according to pension law, and fund expenses.

Tax

You pay no tax on earnings on your investment in the living annuity portfolio. However, any income you withdraw as a pension is taxed according to your current personal income tax rate.

Investment portfolios

The trustees keep a list of investment portfolios for you to choose from. You can find the list of available portfolios here. The portfolios available are offered by Alexander Forbes Investments Limited.

You can choose to invest in a maximum of four investment portfolios from the list. You can also switch portfolios. Please note that your investment must comply with pension law limits and exchange control regulations.

Key features of the Just Income Portfolio

  • Gives you a minimum lifetime income for essential needs
  • Is adjusted to match inflation
  • Offers protection so that you don’t outlive your savings
  • Guarantees a lifetime income that will never reduce
  • Allows you to choose a guaranteed minimum
    payment period
  • Allows you to extend the lifetime income payment to cover the life of your spouse
  • You may not transfer any amounts invested in the Just Lifetime Income portfolio to another portfolio. You may add to the portfolio over time should you wish
  • Allocations to the Just Lifetime Income portfolio cannot
    be reversed

Risk

You should seek professional financial advice before making important financial decisions, as you carry the investment risk, and are responsible for the choice and review of your investment portfolio. Good advice is especially important as investment portfolios do not provide guarantees. This means your investment may grow or shrink, so it’s important for you and your adviser to monitor your investment with your long-term strategy in mind.

Who may act on your behalf?

The fund will accept instructions from you, or people you’ve authorised to act on your behalf. These people are referred to as authorised persons. These can be legal guardians, curators, trustees of insolvent estates, and agents by power of attorney. You must notify the administrator in writing if you no longer want the fund to take instructions from your authorised persons.

AFRIS LIVING ANNUITY

What are your benefits?

If you transfer out of fund

You can transfer your fund credit to another living annuity fund tax free at the time of transfer. Following your written request, your fund credit will be transferred. Note that if you are invested in the JuLi portfolio, you may only transfer your full living annuity investment to a provider who will accept the JuLi portfolio.

If you pass away

Your investment portion will be paid as per your nomination of beneficiary form. Should you not have elected a beneficiary, the benefit will be paid to your estate. If you have selected the JuLi portfolio, and chose a spouse’s annuity, there will be a further benefit payable to your spouse if you pass away.

You should update your beneficiaries every time your life circumstances change, for example if you get married or divorced
or have a child.

You can’t use your will to give instructions about who should share
in your fund credit.

What can your beneficiaries do with a share of your credit fund?

They can:

  • Take the full share as a cash lump sum
  • Convert the full share into a compulsory annuity
  • Take part of the amount in cash and convert part of it into a compulsory annuity

Benefit tax

The tax on the benefit is:

  • Determined by the tax law applicable at the time
  • Calculated according to special tax tables or cash lump sums
  • Calculated according to the normal individual tax tables for income received from compulsory annuities