General information, not financial advice. Not a financial services provider and not SARS. Figures follow SARS's 2026/27 tables and National Treasury rules; we never recommend products.
The two-pot retirement system explained
Since 1 September 2024 retirement contributions are split into a savings component you can reach before retirement and a retirement component you cannot.
General information from SARS and National Treasury, not financial advice. Your fund confirms your balances.
The three components
Savings component: one-third of contributions from 1 September 2024, plus seed capital. You may withdraw from it before retirement.
Retirement component: two-thirds of contributions from 1 September 2024. It is preserved until retirement and then pays a pension or buys an annuity.
Vested component: everything you had saved up to 31 August 2024, less the seed capital. The old rules still apply to it.
Seed capital
On 1 September 2024 funds moved 10% of the vested value into the savings component, capped at R30 000. For example, R200 000 gave R20 000 and R750 000 gave R30 000.
Withdrawals
You may withdraw at least R2 000, once per tax year. SARS issues a tax directive and the withdrawal is taxed at your marginal rate as part of your income. Any tax debt is deducted first. Estimate yours with the two-pot withdrawal tax calculator.
Frequently asked questions
Who is part of the two-pot system?
Members of pension, provident, preservation and retirement annuity funds. Old-generation retirement annuity policies, legacy funds with no active contributing members, and pensioners are generally excluded.
Can I take my retirement component if I resign?
No. The retirement component is preserved until retirement, when it must be used for a pension or to buy an annuity.
What happens to my savings component at retirement?
You can take what is left in it as cash, added to your retirement lump sum and taxed on the retirement table.
General information, not financial advice. KayaRetire gives general information and estimates based on SARS tax tables and guides, National Treasury publications and Minister of Finance notices. It is not financial, tax or investment advice as defined in the Financial Advisory and Intermediary Services (FAIS) Act, it does not recommend any product, fund or provider, and KayaRetire is not an authorised financial services provider. Your fund or insurer and SARS work out the actual amounts. Before you make a decision, speak to your fund, SARS or an authorised financial adviser.