BPOPF warns as pension cash-outs spiral :: Mmegi Online

The Botswana Public Officers Pension Fund (BPOPF), the country’s largest pension fund, says an old age poverty crisis is not in the future, but is already present, due to the high rate of pensioners cashing 50% of their nest eggs at retirement.

Changes to the Retirement Fund Act in October 2022 have allowed different classes of pension fund members to encash greater amounts of their savings for loans, mortgages, and medical expenses or receive a cash payout of 50% of savings, rather than the previous one-third.

Local pension funds estimate that at least seven out of every 10 pensioners are cashing out the maximum 50% at retirement, a situation that leaves many with net replacement ratios lower than the ideal. The net replacement ratio is the ratio of one’s pension compared to the final salary before retirement, which indicates how a pensioner will be able to survive after retirement.

Already have an active account? Log in here.

Or Sign up and get unlimited access to premium articles.

BPOPF warns as pension cash-outs spiral

The Botswana Public Officers Pension Fund (BPOPF), the country’s largest pension fund, says an old age poverty crisis is not in the future, but is already present, due to the high rate of pensioners cashing 50% of their nest eggs at retirement.

Explore

More

Selefu

World Athletics Championships coming to Africa

Man fatally burns in Selebi-Phikwe house fire

Man carrying baby dies whilst crossing Taung road

Young girl perishes in Ledumadumane collision

Driver dies in Gabane head-on collision

Young woman dies in Metsimotlhabe crash

Castle Lite, Let's Pacers team up to unlock Botswana

The Boko-led administration has to tread carefully