Why can't I access my RA funds now? | Fin24
  • Load Shedding Schedules

    Find information for Johannesburg, Durban, Cape Town and other cities.

  • Govt Pension Fund

    The fund says it would be wrong to dismiss R250bn Eskom bailout proposal without all the facts.

  • Sovereign Wealth Fund

    Questions around the fund's scope & mandate remain unanswered, writes Dr. Malan Rietveld.


Why can't I access my RA funds now?

Mar 08 2013 07:29
A Fin24 user is in financial difficulties and wants to know if she can access her RA before age 55. She writes:

I have a retirement annuity (RA) that I have paid up and therefore do not contribute to any more.

There is around R40 000 in the fund that I am desperate to access as I am not coping financially at all right now.

It is about 10 years old and I understand the rules at the time dictate I will not be able to access this money till age 55; however, the money is sorely needed right now.  

At the time I made the policy paid up, I did start another investment where I would receive a full lump sum payment instead of the one-third on offer with RAs, so it's not like I am not saving any more.

What will happen if I cancel the RA? Do I lose the entire R40 000 or will I be charged cancellation fees and paid out the balance?

Are there any other options to somehow access this money or will I have to sue?  

I am pretty sure that constitionally I have a case because after all it is my money and I can prove I am still saving, but I want this money to assist me during this time of incredible financial woes.

It doesn’t make sense that I am literally starving at the moment but I have this money sitting in a fund somewhere with no way of accessing it.

Gavin Came, chairperson of the Financial Planning Committee of the Financial Intermediaries Association of Southern Africa, responds:

Unfortunately it is against the law for an RA fund to pay you any benefits before you turn 55.

There are two exceptions; firstly, in the event that you are permanently disabled and unable to work you may apply to take retirement by reason of disability.

Secondly, if you have formally emigrated from South Africa you may cash in your benefits.

There are discussions under way to propose limited access to RAs prior to retirement in cases of hardship. However, this is at an early stage and it may take a number of years before the law is changed.
The only advice I can give is that you take some short-term cash from your other investment.

 - Fin24

Do you have a pressing financial question? Post it on our Money Clinic section and we will get an expert to answer your query.

Disclaimer: Fin24 cannot be held liable for any investment decisions made based on the advice given by independent financial service providers.

Under the ECT Act and to the fullest extent possible under the applicable law, Fin24 disclaims all responsibility or liability for any damages whatsoever resulting from the use of this site in any manner. 

investment  |  retirement  |  money clinic  |  ras


Read Fin24’s Comments Policy

24.com publishes all comments posted on articles provided that they adhere to our Comments Policy. Should you wish to report a comment for editorial review, please do so by clicking the 'Report Comment' button to the right of each comment.

Comment on this story
Comments have been closed for this article.

Company Snapshot

Voting Booth

How concerned are you about ransomware attacks?

Previous results · Suggest a vote