What is my fund credit?

In a defined contribution fund your fund credit is your specific ‘slice’ of your retirement fund’s ‘pie’. Your fund credit is made up of:

  • All your contributions PLUS
  • All your employer’s contributions PLUS
  • Any money you may have transferred into the fund from your previous employer’s fund PLUS
  • The investment returns (positive or negative) earned on all these amounts.

The benefits you get from the fund will depend on how much money is in your fund credit on the day you leave the fund.

What is my fund salary?

Your fund salary is the annual salary or wage amount that you and your employer use in calculating your respective contributions to the fund.

The contributions you and your employer make are always calculated as a pre-agreed percentage of your fund salary.

Your risk benefits are also based on your fund salary.

Your fund credit can secure a home loan

The Pension Funds Act allows retirement funds to give members financial assistance for housing. As a member of your fund, you may have access to a loan facility to help you buy a home or improve or renovate your existing home.

  • You may borrow a certain percentage of the value of your fund credit.
  • Your withdrawal benefit in the fund acts as security for the loan.
  • Your loan repayments are deducted from your salary every month.
  • Your monthly repayments stay the same even if interest rates change – just the loan repayment period will be affected.
  • You have to repay this loan before you retire. If it is not possible to allow for extra repayment time, your monthly repayment amount will increase.

It is fraudulent to apply for a home loan and use the money for something else. The trustees of your fund have a duty to make sure that loans are being used for housing purposes.