What is comfortable for one person is not necessarily comfortable for the next. We all have different circumstances, so you need to tailor your long-term goals to your personal situation and objectives.

Save as much as you can

The reason the projections are shown as percentages is because inflation will affect the value of your money and any numerical amount will change often. A percentage gives you a better understanding of what your money will mean to you when you retire.

The main purpose of your retirement fund is for you to save up enough money to provide you with a regular income after you retire. Professionals in the retirement industry agree that when your final retirement fund benefit is invested as a pension or annuity, it should give you a pension income of 75% of your pre-retirement salary with annual increases.

Reasons you won’t need 100% of your pre-retirement income when you retire include:

  • After age 65 you pay less tax.
  • You are no longer saving for retirement.
  • You won’t pay for transport to travel to work and back.
  • You should be debt-free (your house and car would probably be paid off and your children will no longer depend on you financially).

Use the following guide to find out how much you need to save now to replace at least 75% of your pre-retirement salary when you retire:

  Planned retirement age - 55 Planned retirement age - 60 Planned retirement age - 65
Current age - 20 26% 19% 14%
Current age - 30 41% 29% 21%
Current age - 40 78% 50% 33%

*Assuming that you start saving from the ‘current age’ and haven't built up any retirement savings. These projections assume that you achieve a ‘moderate’ real rate of investment return.

Plan ahead

The retirement projection tool helps you plan properly for your retirement by giving you an idea of what you will need to save for your retirement and the power to do something about it today. The projection tool will help you decide:

  • How to preserve your savings.
  • What contributions you should make and your contribution rate.
  • If you need to save more and where.

Speak to a financial planner if you have any questions about your retirement savings.

The retirement projection tool is interactive and lets you play around with different variables so you can get a better idea of what you should be saving. If you do have additional savings, are making additional contributions through a top-up pension fund or if you are planning to retire at a specific age, you can put that information into the projection tool and see what difference it makes.

The retirement projection statement shows a projection of your retirement income and any shortfalls to the desired 75% of your pre-retirement income. The statement shows you what you have saved versus what you will need at retirement. The projection statement is based on your fund salary as well as the retirement benefits you are receiving from your current employer.

With the life cover needs analysis statement, you can see how much life cover your retirement fund death benefit provides and you can see if any shortfalls have been projected. This will help you make sure that you can provide for your loved ones in the event of your death.

Use the AF Online projection tools

When using the projection tools, remember that the projections are potential outcomes, not firm predictions. They give you an idea of what you could expect to have saved up for your retirement through your retirement fund.

These retirement projections are calculated assuming that:

  • You will retire at your normal retirement date.
  • The net contributions you and your company make to your retirement fund will stay the same over time.
  • You have no other money saved up for your retirement.
  • You are invested in either a low, moderate or high growth scenario.

The unfavourable scenario assumes the investment return will exceed inflation by 3% a year, the expected scenario by 4.5% a year and the favourable scenario by 6% a year.

If you do have extra money saved up, are planning to retire at a specific age or are making extra contributions to your retirement fund, the interactivity of the tool allows you to include that information to see what your particular projected retirement savings will be. 

The projections are broken down into two parts:

  1. Your fund credit growth – including annual increases to your fund salary and contributions – until your normal retirement age.
  2. The pension you could expect to get with that fund credit when you retire, expressed as a Rand amount in today’s money terms relative to your fund salary today.

The reason for expressing the projections in today’s money terms is because inflation erodes the value of money. To provide you with a numerical amount without giving it an understandable value would be pointless.

It is for this reason we express everything in today’s money terms relative to your pensionable salary today – so you can get a better perspective of what your pension money will actually mean to you at retirement.

Projection tools

Use the projection tools to help you with your financial planning.

Budget tool

Get a handle on your finances by understanding where your money goes every month. The budget tool is easy to use and does all the hard work for you by prompting you to think about all of your possible expenses. Take the first step to financial security by using the tool to set, maintain and control your budget.

Bond/debt repayment tool

Know which of your debts is costing you the most, and which should you pay off first. The debt tool will help you understand the smartest way to pay off your debt.

Life cover tool

How much life cover do you actually need? The life cover tool calculates it for you, with just a few basic questions about your life circumstances.

Savings projection tool

Whether it’s that overseas holiday, or your children’s education, the savings tool helps you achieve important things in life by mapping out how much you need to save, and earn on your savings, in order to see those dreams become a reality.

Retirement build-up tool

Use this tool to find out whether you are on track for a comfortable retirement. It allows you to see how much you have saved already, and what this will mean for you at retirement. It also allows you to see how much extra you need to save, depending upon your specific retirement goals.

Annuity bureau tool

For those in the two years leading up to retirement, this tool provides quotes on the different types of pension in the market. Take retirement planning to the next level by seeing how much your retirement savings will actually buy you as a pension. The annuity bureau tool sources quotes for you from the market, and only shows you the best quotes for each type of pension.

Tax Calculator

For those leaving or retiring from their retirement fund, the tax calculator shows you how much tax you would pay if you were to leave or retire from your retirement fund. Depending on what you decide to do with the money, the tax implications differ, so the tool allows you to see the tax that would be paid in each scenario.

Please Note: These tools have been provided for illustrative purposes only. By using the information contained in the tools you acknowledge that you understand the notes, and the implications thereof, and the impact of this on the results. Please note that neither Alexander Forbes, the Fund, or the Trustees, or any of their employees or agents accept any responsibility for losses arising from, or damages caused by, or expenses incurred by Members as a result of using the information contained in this tools.