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WITH interest rates at 30-year lows, many older South Africans are seeing the monthly income from their savings dwindle - at a time when electricity costs and other expenses are rocketing.
Many are hoping to supplement their income with a government old age grant.
South Africans of 60 years and older can apply to receive a monthly payment, but will be subjected to means testing.
If you are single and have an income of less than R44 880 a year, you will qualify for state assistance. If you are married, your joint income has to be less than R89 760.
Government officials will, however, look at your assets – which include your house– to consider whether you qualify.
If you are single and have assets (including your house) worth more than R752 400, you won't be considered. A married couple has to have assets worth less than R1 504 800 (including property).
When you apply for a grant, an official will go through your bank accounts and other financial statements to check whether you will qualify.
But even if your income and assets qualify you for a grant, you may still not be entitled to the full grant of R1 140 a month. Depending on your current level of income, the official will decide whether you may get a lesser amount, which could go down to R740 a month, for example.
Paul Rosenbrock, director of the SA Association of Retired Persons, says his organisation's experience is that the officials are relatively flexible with affording grants.
But he thinks the means test should be scrapped. "Why discriminate against people that have lived their lives in a disciplined and responsible way whilst contributing by way of tax payments their whole working life?"
The grant is however far too paltry to really be of any help, Rosenbrock adds. "It helps people exist, but does not allow them to live with any dignity."
He sees a crisis unfolding among SA's older people. Despite contributing to retirement savings for decades, many people did not have the adequate knowledge to invest lump sum payouts and now have very little to live on.
"It is arguably immoral to offer employees who are totally financially immature - in terms of qualifications, experience or training - the apparent opportunity to get their hands on a large lump sum (defined benefit based retirement contributions) in lieu of a guaranteed monthly income (defined income based retirement income)."
Other requirements needed to qualify for an old age grant is that you don't live in a state old age home (or any other state institution) or already receive another type of government grant. If you can't look after yourself and need full-time care, your carer is entitled to a Grant-in-Aid of R180 a month.
Applications are free and can be submitted at your district welfare office. You will need to bring your ID, a marriage certificate (and, if you are widowed, your spouse's death certificate), or an affidavit stating that you are single or a divorce order. You will be interviewed by a government official and your fingerprints will be taken.
Other documents required are statements of your current pension and any investments, as well as the past three months' bank statements. Also, if you are still working, proof of your salary, or your Unemployment Insurance Fund discharge certificate from your previous employer, if you are out of work.
If you cannot attend the interview yourself, you can nominate someone to bring a letter from you as well as a doctor's note. A government official may visit you in your house.
It will take 30 working days to process your application. If it is turned down, you will receive a letter of explanation. For successful applicants, payments will start within three months and will be backdated to the day you applied.
Your grant will be cancelled if your income or assets improve and you no longer pass the means test, or if you are admitted to a state institution, or on your death.
The South African Social Security Agency (Sassa) has a toll-free helpline (0800 601 011).
- Fin24
Many are hoping to supplement their income with a government old age grant.
South Africans of 60 years and older can apply to receive a monthly payment, but will be subjected to means testing.
If you are single and have an income of less than R44 880 a year, you will qualify for state assistance. If you are married, your joint income has to be less than R89 760.
Government officials will, however, look at your assets – which include your house– to consider whether you qualify.
If you are single and have assets (including your house) worth more than R752 400, you won't be considered. A married couple has to have assets worth less than R1 504 800 (including property).
When you apply for a grant, an official will go through your bank accounts and other financial statements to check whether you will qualify.
But even if your income and assets qualify you for a grant, you may still not be entitled to the full grant of R1 140 a month. Depending on your current level of income, the official will decide whether you may get a lesser amount, which could go down to R740 a month, for example.
Paul Rosenbrock, director of the SA Association of Retired Persons, says his organisation's experience is that the officials are relatively flexible with affording grants.
But he thinks the means test should be scrapped. "Why discriminate against people that have lived their lives in a disciplined and responsible way whilst contributing by way of tax payments their whole working life?"
The grant is however far too paltry to really be of any help, Rosenbrock adds. "It helps people exist, but does not allow them to live with any dignity."
He sees a crisis unfolding among SA's older people. Despite contributing to retirement savings for decades, many people did not have the adequate knowledge to invest lump sum payouts and now have very little to live on.
"It is arguably immoral to offer employees who are totally financially immature - in terms of qualifications, experience or training - the apparent opportunity to get their hands on a large lump sum (defined benefit based retirement contributions) in lieu of a guaranteed monthly income (defined income based retirement income)."
Other requirements needed to qualify for an old age grant is that you don't live in a state old age home (or any other state institution) or already receive another type of government grant. If you can't look after yourself and need full-time care, your carer is entitled to a Grant-in-Aid of R180 a month.
Applications are free and can be submitted at your district welfare office. You will need to bring your ID, a marriage certificate (and, if you are widowed, your spouse's death certificate), or an affidavit stating that you are single or a divorce order. You will be interviewed by a government official and your fingerprints will be taken.
Other documents required are statements of your current pension and any investments, as well as the past three months' bank statements. Also, if you are still working, proof of your salary, or your Unemployment Insurance Fund discharge certificate from your previous employer, if you are out of work.
If you cannot attend the interview yourself, you can nominate someone to bring a letter from you as well as a doctor's note. A government official may visit you in your house.
It will take 30 working days to process your application. If it is turned down, you will receive a letter of explanation. For successful applicants, payments will start within three months and will be backdated to the day you applied.
Your grant will be cancelled if your income or assets improve and you no longer pass the means test, or if you are admitted to a state institution, or on your death.
The South African Social Security Agency (Sassa) has a toll-free helpline (0800 601 011).
- Fin24
