May I retire before my normal retirement date? If so, what will my benefit be?

Yes, you may retire before your normal retirement date.  If, however, you retire before the age of 60 years, your employer must grant approval.  For purposes of illustration we refer to Categories A,B and C in the example below.  These categories do not appear in the registered Rules.

 

Category A

 

If you retire early between the age of 60 and 63 years, your pension will be calculated as in the paragraph regarding your pension at your Normal Retirement Date, but taking into account your Final Average Emoluments and Pensionable Service when you retire.

 

Category B

 

If you were a member of the Fund before 1 January 1960, have completed at least 30 years’ Pensionable Service, have reached the age of 50 years and you retire more than 3 years before your Normal Retirement Age (63 years), your pension will be calculated as described in the paragraph regarding your pension at your normal retirement date, but taking into account your Final Average Emoluments and Pensionable Service when you retire.

 

Category C

If you have completed at least 10 years’ Pensionable Service, have already reached the age of 50 years, but not yet 60 years, and you retire or are discharged from the employer’s service, your pension will be equal to a part 1/(m + 540) of your Final Average Emoluments for each month of Pensionable Service, where M represents the number of full months between your actual retirement age and the age of 60 years.

 

The following example shows a typical calculation of this early retirement benefit referred to in Category A.  In the example we have assumed that the member retires 1 year (12 months) before his Normal Retirement Date.  The member’s Final Average Emoluments at the time is R57 000 and the member has completed 29 years (348 months) of Pensionable Service.

 

Final Average Emoluments

R57 000

Pensionable Service

29 years

Therefore the member receives a pension of –

348/540 x R57 000

 

= R36 733,33 per year

R3 061,11 per month

 

The following example shows a typical calculation of this early retirement benefit referred to in category B.  In the example we have assumed that the member retires 4 years (48 months) before his Normal Retirement Date.  The member’s Final Average emoluments at the time is R52 000 and the member has completed 26 years (312 months) of Pensionable Service.

 

Final Average Emoluments

R52 000

Pensionable Service

26 years

Therefore the member receives a pension of –

312/540 x R52 000

 

= R30 044,44 per year

R2 503,70 per month

 

 

The following example shows a typical calculation of this early retirement benefit referred to in Category C.  In the example we have assumed that the member retires earlier at age 58 years, that is 2 years (24 months) before age 60 years.  The member’s Final Average Emoluments at the time is R45 000 and the member has completed 25 years (300 months) of Pensionable Service.

 

Final Average Emoluments

R45 000

Pensionable Service

25 years

Therefore the member receives a pension of –

300/24 + 540 x 45 000

 

= R23 936,17 per year

R1 994,68 per month