2025-12



Issued December 2025

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In this newsletter...
	Benchtest 11.2025 – MD’s year-end message, FIMA restarted, informal sector alternative pension systems and more...

Jump to...
	Important notes & reminders In this newsletter... A year-end message from the managing director Tilman Friedrich's industry forum Compliment Benchmark: a note from Günter Pfeifer	News from RFS Legal snippets Snippets for the pension fund industry Snippets of general interest And finally...


IMPORTANT NOTES AND REMINDERS

	Annual Office Closure Please note that our office will be closed for the annual holiday break from Friday, 19 December 2025 through Friday, 02 January 2026, and will reopen on Monday, 05 January 2026.We appreciate your understanding and wish you a safe, restful, and happy holiday season and New Year. NAMFISA levies Funds with December 2024 year-ends must submit their 2nd levy returns and payments by 23 January 2026; Funds with June 2025 year-ends must submit their 1st levy returns and payments by 23 January 2026; and Funds with December 2024 year-ends must submit their final levy returns and payments by 31 December 2025. Housing loan interest rate remains unchanged The interest rate on direct housing loans remained unchanged at 9% in December. The minimum repayment amounts will also remain unchanged for January 2026.	Registered service providers Certain pension fund service providers must register with NAMFISA and submit regular reports to the authority. Download a list of service providers registered as of August 2025, here... Retirement calculator Use our web-based retirement and risk shortfall calculator for your retirement planning. Find it here... If you need help with your financial planning, get in touch with Annemarie Nel CFP® (061-446 073) Christina Linge (061-446 075) Dennis Fabianus (061-446 098) Toolbox for trustees RFS provides comprehensive support for trustees. Find a list of download documents to assist with the governance and management of private funds, registered as of June 2024, here...


IN THIS NEWSLETTER...

	In this newsletter, we address the following topics:

	Read the end-of-year message to RFS stakeholders in ‘A note from the managing director’. In 'Tilman Friedrich's industry forum' we present... Monthly review of portfolio performance – 30 November 2025 Hedge Funds in a World on Edge – A Namibian Investor’s View The FIM Act - a new start: Gen.S.10.9, Gen.S.10.10. Alternative pension systems for the informal sector: lessons for Namibia Leadership lessons from the driving seat In Compliments, read... Compliment from a principal officer. In 'News from RFS', read about... Long service awards. RFS Kiddies Party Staff improving their competencies Important circulars issued by RFS	In 'Legal snippets', read about... PFA Determination on Loan Arrear Interest: A Matter of Member Accountability. Settling Housing Loans with Pension Money In 'Snippets for the pension funds industry,' read about... The uncomfortable reality of death claims on retirement funds Timing of Dependency in Pension Death Benefits In ‘Snippets of general interest', read about... What never to include in your will; From R5 million to broke: how Retirees destroy their wealth And make a point of reading what our clients say about us in the ‘Compliments’ section. It should give you a good appreciation of who and what we are! As always, your comment is welcome, so open a new mail and drop us a note! Regards Tilman Friedrich




A NOTE FROM THE MANAGING DIRECTOR

End-of-year message to RFS stakeholders

	Each year, I look forward to predicting what the coming year might bring. I must admit that for the past two years, I have gotten at least one major prediction wrong — and that is the introduction of the Financial Intermediaries and Markets Act (FIMA). Contrary to all expectations, FIMA did not arrive this year either. So, it should come as no surprise that I will once again list FIMA among the challenges we expect to face in the new year. My other prediction that fell short was that we would, by now, have fully completed our system migration for the administration of both our stand-alone funds and the Benchmark Retirement Fund. Alas, we are not quite there yet. But I remain confident that by this time next year, we will have completely mastered our new administration system, “Everest,” and be running business even more efficiently than before. This year has been defined by the challenges of adapting to our new system. If it was not pensioner payrolls reacting unpredictably to manual interventions, it was ITAS tax reconciliations keeping our team up at night. When actuarial data failed to meet our expectations, auditors and trustees waited with bated breath for extensions to the annual financial statements. The list of challenges is long, but the list of accomplishments is thankfully longer. I am proud to report that most migration-related issues are now behind us. All annual financial statements for our stand-alone funds have been completed and submitted to NAMFISA. We have successfully resolved ITAS reconciliations and issued all tax certificates. Communication with funds and members has remained consistent and effective. Most notably, contributions and member value updates for all clients are now completed within a month, an impressive achievement in our industry. As they say, “the whole is greater than the sum of its parts.” Across the business, we have continued to invest in IT infrastructure to keep pace with rapid change and rising cybersecurity risks. In September, we successfully replaced all our servers and backup systems, both on-site and at our disaster recovery centre, without a single disruption. This seamless transition is a testament to our exceptional IT team and trusted business partners. Our marketing and brand growth have been equally remarkable, though perhaps a well-kept secret. Thanks to ongoing initiatives and a stronger social media presence, our LinkedIn following for RFS now exceeds 3,600, and our Facebook followers have surpassed 4,600 for RFS Fund Administrators and our Benchmark Retirement Fund combined. Even our youngest brand, RFS Financial Advisors, continues to gain momentum with nearly 600 Facebook followers and over 200 LinkedIn followers, and counting. We seldom talk about our corporate social responsibility, but our impact continues quietly and meaningfully. Each executive director is allocated a budget to support a cause of their choice. Personally, I have been privileged to support NAMCOL learners for over a decade, rewarding academic excellence and helping to fund further studies. We have also supported the Onkanti Foundation for cancer patients and recognised outstanding teachers through Project Lilie. We sponsored youth sports, including hockey and SKW football. We believe in giving back not for recognition, but because it is the right thing to do. Our clients across all sectors have continued to show immense support and patience during our transition. Their confidence has been both humbling and motivating. A highlight this year was our reappointment by the NBC Retirement Fund for another 3 years, and a 1-year extension from the NAMFISA Provident Fund, clear votes of confidence earned by our administration and fund accounting teams and reinforced by our client managers’ dedicated relationship-building. Our flagship Benchmark Retirement Fund remains a key driver of growth. Since December 2024, we have onboarded a good number of clients, with more pending NAMFISA approval. These wins underscore the trust the market is placing in our systems and service delivery. Internally, our staff complement has grown to over 80. Our turnover has improved to just 6% per year, even amid operational challenges, proving a resilient and committed team! To all our staff who have chosen to “stick it out,” thank you for your perseverance, creativity, and belief in what RFS stands for. The growing number of long-service milestones—5, 10, 15, and even 20 years — reflects our shared commitment to building rewarding, long-term careers. We continue to encourage and support professional development through financial assistance, study leave, mentoring, and on-the-job learning. Of course, company support alone means little without individual drive. The best outcomes come from self-motivated people who take initiative, and this year, we proudly celebrate Annemarie Nel for earning the prestigious title of Certified Financial Planner. Well done, Annemarie! This year has truly felt like a climb, full of sharp turns, steep hills, and the occasional detour, but we have kept moving forward together. As we look ahead, the road will not flatten out. The coming year will bring new challenges, expectations, and opportunities. But we have proven, time and again, that we can thrive in demanding conditions. I am confident that we can shift into an even higher gear. As we close the year, I want to extend heartfelt thanks to our staff, clients, trustees, and partners. Your support, patience, and commitment make everything we achieve possible. Together, we have shown that no matter how steep the road, we have what it takes to climb and to accelerate into the future. Here’s to another year of resilience, progress, and shared success.





TILMAN FRIEDRICH'S INDUSTRY FORUM

Monthly Review of Portfolio Performance to 30 November 2025

	In November 2025, the average prudential balanced portfolio returned 0.6% (October 2025: 2.4%). The top performer is the Old Mutual Pinnacle Profile Growth Fund, with 1.2%. The NAM Coronation Balanced Fund, with -1.2%, takes the bottom spot. Ninety One Managed Fund takes the top spot for the three months, outperforming the ‘average’ by roughly 1.3%. The NAM Coronation Balanced Fund underperformed the ‘average’ by 2.0% on the other end of the scale. Note that these returns are before (gross of) asset management fees. The Monthly Review of Portfolio Performance to 30 November 2025 reviews portfolio performances and provides insightful portfolio analyses. Download it here...

Hedge Funds in a World on Edge – A Namibian Investor’s View

	A recent Laurium Capital article, “Why South African Investors Should Be Considering Hedge Funds Right Now,” argues that hedge funds can protect capital and enhance returns after an extraordinary run in equity markets. While that argument holds merit in a conventional business cycle, today’s global setting is anything but conventional. 1. A Market Buoyed by Optimism – and Fragile Foundations Local and global equity markets have rallied spectacularly. The JSE rose 33% year-to-date to end-October, and the MSCI World Index nearly 20% in USD terms. Laurium is correct that such returns are unsustainable. Yet the more significant question is why markets are elevated. Global liquidity injections, speculative technology valuations, and short-term optimism around disinflation have combined to mask deeper structural tensions. Behind this exuberance lies a brewing contest for global dominance boosted by the onshoring and ‘friendshoring’ of critical supply chains. The United States is working to secure critical mineral supply chains, negotiating a one-year deferment on China’s export ban of rare earths while accelerating sourcing from Australia and allied nations. Europe, for its part, is preparing for heightened confrontation, stockpiling essential supplies and revisiting conscription laws. Such developments hint at an uneasy three-year horizon of geopolitical escalation. 2. Hedge Funds: Protection or Illusion of Safety?... Read paragraph 6 of the Monthly Review of Portfolio Performance to 30 November 2025 for an interesting perspective on global equity sectors. Download it here...


The FIM Act – a new start Contributed by Carmen Diehl, C.A.(Namibia), Senior Manager: Risk Management and Compliance

	The FIMA (Act 2 of 2021) was promulgated in Government Gazette no. 7645 on 1 October 2021. The Minister of Finance has not yet set an effective date. In the last several newsletters, we have presented brief overviews of the latest status on standards and regulations. We continue the series in this newsletter. This summarises the main provisions of draft standards and regulations under the FIM Act and implications for retirement funds. Standards Chapter 10: General GEN.S.10.9 Code of Conduct This Standard applies to all financial institutions and financial intermediaries registered under the Act. Summary: Every financial institution and financial intermediary must have a code of conduct policy in place (includes individual financial intermediaries not appointed by an entity). The code of conduct policy must contain the basic elements listed in the standard. It must be acknowledged by board members, directors, principal officers, trustees, custodians, auditors, valuators, other key persons and employees. Basic elements of code of conduct policy: Policy statement: defining ethical standards for conduct Conflicts of Interest definition and handling procedures Legal Compliance: Adherence to all relevant laws and regulations Company or Individual Information and Assets: Disclosure of financial and operational information Workplace practices: Ethical behaviour and reporting of dishonest, unethical or illegal activities Confidentiality of information relating to the entity and stakeholder information Reporting, Enforcement and Sanctions: Procedures for reporting breaches to NAMFISA Appropriate sanctions: must be proportional to the breaches of the policy The code of conduct should contain the following principles for the board, management and staff of the financial institution or financial intermediary: Act in good faith, with prudence, skill, and diligence. Maintain independence, objectivity, and avoid conflicts of interest. Comply with all laws and internal codes. Treat customers fairly and impartially. Align actions with institutional goals and regularly assess performance. Maintain confidentiality and communicate transparently with stakeholders and regulators. What to do: Financial institutions and financial intermediaries should draft a code of conduct that meets the requirements of this standard or amend their existing code of conduct to conform to this standard. GEN.S.10.10 Outsourcing of functions and responsibilities by financial institutions and financial intermediaries This Standard applies to all financial institutions and financial intermediaries. Summary: A financial institution or financial intermediary may not outsource its principal business, which is defined in Schedule 2 attached to this Standard. Material business functions may be outsourced, but only in compliance with this Standard. The board and senior management of a financial institution or financial intermediary are ultimately responsible for ensuring compliance with this Standard. The board and senior management must designate employees responsible for continuously identifying, reporting and mitigating risk strategies of outsourced arrangements. When outsourcing material business functions, the board and senior management must: Develop and implement an outsourcing policy, to be reviewed every three years; Ensure compliance with the outsourcing policy across all business units; and Identify and manage risks before and during outsourcing. The outsourcing policy must adhere to the requirements of this Standard, define principal vs material business functions, set criteria for selecting and managing service providers and address the outsourcing principles in the Standard and associated risks. Outsourcing must be guided by seven key outsourcing principles, applied based on the materiality and risk level of the outsourced function. The minimum contractual obligations that every outsourcing agreement must contain are set out in Schedule 1 attached to this Standard. In-sourcing arrangements (outsourcing to subsidiary, affiliate or associate) must be justified with documentation showing due diligence, cost-effectiveness, provider capability, and compliance with this Standard. Off-shoring arrangements (outsourcing to a service provider located outside Namibia) must be justified with documentation showing that offshoring arrangements are cost-effective, risk-managed, and compliant with regulatory standards. NAMFISA’s approval must be obtained, and NAMFISA may require alternatives if the risks are not adequately addressed. NAMFISA must be notified within 30 business days of entering, amending, or terminating an outsourcing agreement. A transitional period of 12 months from the effective date of the Standard is provided in respect of existing outsourcing arrangements. What to do: Financial institutions and financial intermediaries should draft an outsourcing policy, thereby identifying their principal and material business functions, and address the outsourcing principles of this Standard. For outsourcing of material business functions, financial institutions and financial intermediaries should review their existing service level agreements against the requirements of this Standard. Processes should be amended to make provision for the notification of NAMFISA within 30 days of entering, amending, or terminating an outsourcing agreement. Alternative Pension Systems for the Informal Sector: Lessons for Namibia Namibia’s long-standing ambition to establish a National Pension Fund (NPF) under the Social Security Act of 1994 remains unrealised, while the private pension sector—regulated under the Pension Funds Act of 1956, has flourished. Formal-sector employees already contribute significantly to well-capitalised occupational pension funds, which play a vital role in domestic investment and economic stability. However, informal-sector workers remain excluded from pension coverage. As nearly 70% of Namibia’s population is under 35 and many are engaged in informal work, the absence of a safety net poses a growing socio-economic risk. Rather than pursuing a disruptive, compulsory defined benefit NPF, Namibia should consider inclusive, parallel mechanisms that complement the existing private pension system. Lessons from Kenya, India, and Rwanda offer valuable models: Kenya’s Mbao Pension Plan: A voluntary, mobile-enabled scheme allowing informal workers to contribute as little as KES 20 daily. Despite low coverage, it promotes financial literacy and flexible saving. India’s Atal Pension Yojana (APY): A government-backed, guaranteed pension scheme for informal workers, with co-contributions and mandatory annuitisation. It builds trust through clear design and fiscal guarantees. Rwanda’s Ejo Heza Scheme: A mobile-integrated, voluntary savings plan linked to national ID, offering tiered government incentives and insurance benefits. It fosters inclusion and long-term financial security. These models demonstrate that informal-sector pension coverage can be expanded without dismantling existing systems. Namibia’s reform should prioritise legal clarity, fiscal sustainability, and interoperability—preserving the strength of its private pension industry while extending protection to all citizens. Key Takeaway for Lawmakers and Regulators The author urges that the path toward a universal pension framework should balance inclusivity with structural continuity. The examples from Kenya, India, and Rwanda clearly demonstrate that a successful strategy lies in designing flexible, accessible, and incentive-driven schemes specifically for informal workers. Mobile integration, government co-contributions, and national ID-linked systems are presented as key enablers that can create an inclusive pension system for all citizens without compromising the strength and stability of the existing private retirement funding sector. Read the opinion piece by Vincent Shimutwikeni, Manager, Legal Support Services, here. Leadership Lessons from the Driving Seat “Leadership is not about power; it’s about purpose.” – Brand Pretorius By Tilman Friedrich I recently had the privilege of listening to Brand Pretorius, the legendary former CEO of McCarthy, speak on “In the Driving Seat.” His reflections on leadership resonated deeply with me. Having founded RFS Fund Administrators twenty-five years ago, I realised how closely my own journey mirrors the principles he described, principles that have quietly underpinned our company’s growth and reputation over the past quarter century. Pretorius spoke of ‘authentic leadership’, leading with integrity, humility, and sincerity. From our first day at RFS, I believed that trust is earned not through grand speeches but through ‘consistent action’. When staff, clients, and trustees see that you mean what you say, every time, they begin to trust not only you, but the institution you represent. He also emphasised ‘servant leadership’. True leaders serve their people, not the other way around. This philosophy has shaped our culture. We have always seen ourselves as ‘custodians’, not controllers, serving members, trustees, employers, and regulators with a sense of moral duty. In our industry, which touches the lives of thousands of pensioners and families, this responsibility can never be taken lightly. Pretorius reminded us that leadership requires ‘courage and accountability’. In difficult times, one must not hide behind committees or consultants. I have learned that even unpopular decisions, taken with fairness and transparency, strengthen an organisation’s character. Finally, he spoke about ‘vision and values’ — that a business must have a clear purpose beyond profit. At RFS, our purpose has always been to provide a truly Namibian, professional, and ethical pension fund management service. We have grown not because we chased numbers, but because we pursued ‘excellence through values’. As I listened to Pretorius, it struck me that leadership is not about the destination but about ‘the journey’, the daily commitment to honesty, service, and accountability. The exceptional success of RFS over the past 25 years is, in essence, a reflection of those timeless principles behind the wheel.


COMPLIMENT

	Compliment from a principal officer Dated June 2025	““Dear Sharika, Trust you are well. A note to convey my thanks to the RFS team (Jolene, Caroline, and Rauha) for making time yesterday and meeting with Mr JM (a living annuitant), to discuss his switch query from last year. The RFS team was warm in welcoming us and well prepared. Notably, Mr M emphasised the pleasing standard of care and great service provided throughout. I share his sentiments. Kind regards,””

	Read more comments from our clients, here...


BENCHMARK: A NOTE FROM GÜNTER PFEIFER

	Circulars issued by the Fund

	The Benchmark Retirement Fund issued no new circular after: 202503 – Benchmark Default Portfolio annual review Clients are welcome to contact us if they require a copy of any circular.


NEWS FROM RFS

Long Service Awards

	RFS places a high value on its employees and recognises the importance of their contributions to the company’s success. In addition to recognising employees’ contributions, long service awards can be a powerful retention tool, demonstrating that the company values and appreciates its employees’ dedication and hard work. These awards foster a positive, motivating work environment where employees feel supported and encouraged to grow and develop within the company. In November, RFS recognises the following anniversary: Salome Sloa, tenth anniversary on 1 November 2025. We sincerely thank Salome for her dedication, loyalty, and support since joining RFS. We look forward to her future contributions to the good of RFS, our clients, and our colleagues!

RFS Kiddies Party

	Smiles all around as RFS parents and their little ones enjoy a day of laughter, games, and great company at the Mercure Hotel organised by the newly elected social committee for 2026.
Staff improving their competencies
	RFS prioritises the ongoing education and professional development of its staff. As Nelson Mandela once said, “education is the greatest equaliser,” and by investing in the education and training of its employees, RFS is helping to create a more skilled and knowledgeable workforce. By supporting its staff in their pursuit of further education, RFS is also investing in the long-term success of its business. As staff members become more skilled and knowledgeable, they are better equipped to provide high-quality service to clients and to help the company stay competitive in a rapidly changing market. We are proud to announce that our Immanuel Nambahu has successfully completed his studies and will soon be awarded a Bachelor’s Degree in Economics. This achievement reflects Immanuel’s hard work and dedication, and we congratulate him on reaching this important milestone! Elevate your fund experience with EPIC Members of funds administered by RFS can now access our EPIC communication platform, provided the trustees agree to make it available to members. Members can access their benefits and investment values online from anywhere at any time. Members of the Benchmark Retirement Fund take note that they have similar functionality through Benefit Counsellor. We encourage our fund members to make the best use of these facilities.
The RETIREMENT COMPASS

	RFS Fund Administrators sponsor this newsletter as part of their social responsibility and initiatives to support the retirement fund industry. It aims to provide members of funds managed by RFS Fund Administrators and other parties in their network with retirement funding and planning-related news and insights, presented understandably. The latest issue covers the following insightful articles: Your Retirement Fund made simple - Part 1: What it is, how it works and how your money grows; Real Member Journey: How a Retirement Fund Helped Ndapewa Build Her Future; Why Updating Your Beneficiaries Can Spare Your Family Unnecessary Hardship.Don’t miss out on the latest Retirement Compass (vol 2, no 3) here...

Important circulars issued by RFS

	RFS issued the following circular in November: RFS 2025.11-10 System migration completion. Clients are welcome to contact us if they require a copy of any circular.



LEGAL SNIPPETS

PFA Determination on Loan Arrear Interest: A Matter of Member Accountability Contributed by Vincent Shimutwikeni, B. Juris, LLB (honours), CGRC-BP™, Manager: Legal Support
	The determination in M E Mphelo v Municipal Employees Pension Fund and City of Johannesburg (2011) by the South African Pension Funds Adjudicator (PFA) provides a seminal ruling on the allocation of liability for accrued arrear interest on member housing loans, particularly when the non-repayment is due to administrative failure. Core Issue and Factual Matrix A member of the Municipal Employees Pension Fund obtained a housing loan in February 2005. Due to an administrative lapse between the Fund and the Employer (City of Johannesburg), the agreed-upon salary deductions did not commence for almost four years (until April 2009). This failure caused the outstanding loan balance to inflate significantly due to accrued interest. The Complainant sought cancellation of this arrear interest, arguing she was unaware of the non-deduction and had not received benefit statements. Analysis and Legal Principles The Adjudicator dismissed the complaint, affirming two paramount principles for the sustainability of pension fund housing loans: Primary Obligation of the Member: Drawing on precedent (specifically Felander v Cape Municipal Pension Fund), the PFA held that the primary contractual duty to repay the loan rests with the member, not solely with the administrative agents (Fund or Employer). By accepting the loan, the member assumes the personal responsibility for repayment. Fiduciary Duty to the Fund: The Adjudicator emphasised the Fund’s fiduciary duty to its entire membership. Writing off the arrear interest would result in a financial loss to the Fund, thereby prejudicing other members and undermining the Fund's overall financial integrity. This collective fiduciary duty outweighs the individual member’s plea for fairness. The PFA found that the member had failed to monitor her financial obligations. She received monthly payslips that clearly showed the loan deduction was absent for nearly 4 years. Furthermore, she was deemed to have benefited financially from the increased disposable income during the non-deduction period, meaning she could not claim to have suffered financial prejudice. Determination and Technical Takeaway The complaint was dismissed, and the member was held liable for the full amount of the arrears interest. This case serves as a critical technical takeaway for Namibian funds, administrators, and trustees: Member Accountability: The ruling legally reinforces the requirement for members to exercise financial prudence by actively reviewing their payslips, benefit statements, and records. Administrative Clarity: While the member was ultimately held liable, the case highlights the necessity for impeccable coordination and timely communication between the Fund and the Participating Employer to ensure prompt execution of deduction instructions and transparent reporting. Protection of Capital: It affirms that arrears interest is debt and must be recovered to protect the collective pool of assets. Fiduciary responsibilities dictate that funds cannot easily write off debt arising from administrative errors if the member can be shown to have been negligent in monitoring their finances. Read the full article here. Settling Housing Loans with Pension Money Contributed by Vincent Shimutwikeni, B. Juris, LLB (honours), CGRC-BP™, Manager: Legal Supporty The Issue at Stake The complaint centred on a fund's refusal to permit members, while still employed, to use a portion of their accumulated fund values to settle their outstanding housing loans. The members argued that financial hardship necessitated the pre-exit set-off to improve disposable income. The respondents (Fund and Administrator) cited the overriding protective legislation. Core Legal Principles and Analysis The Adjudicator dismissed the complaint by reinforcing the fundamental principles governing the protection and payment of retirement benefits: Statutory Preservation (Section 37A): Section 37A(1) of the Pension Funds Act is a "firewall," prohibiting any reduction, attachment, cession, transfer, or pledge of a member's benefit prior to it becoming payable (i.e., upon exit/retirement). The legislative intent is clear: to safeguard benefits from premature erosion and potential impoverishment. Fund Rules are Binding (Section 13): The Adjudicator affirmed that the fund’s rules are binding on the fund and its members. Citing the Supreme Court of Appeal's precedent in Tek Corporation Provident Fund v Lorentz, trustees have only the powers explicitly conferred by the fund rules. Since the rules restricted benefit payments to circumstances of service termination, the trustees could not unilaterally authorise an in-service payout or reduction. The Narrow Exception (Section 37D): Section 37D provides the only relevant exception where a set-off against a housing loan may occur. Specifically, Section 37D(1)(a)(ii)(cc) allows for a deduction only if: The loan was granted under Section 19(5). The member is in default of the loan repayments. No other arrangements for repayment can be made. Technical Takeaway Because the complainants were not in default, the narrow statutory exception under Section 37D did not apply. The Adjudicator concluded that allowing the voluntary set-off, despite the member’s financial distress, would undermine the protective purpose of the Act. This determination underscores a critical principle for funds and administrators: the statutory duty of benefit preservation (S37A) is paramount and takes precedence over member autonomy or compassionate considerations unless one of the explicitly defined, limited exceptions (such as S37D in the case of default) is met. Read the article in this link.



SNIPPETS FOR THE PENSION FUND INDUSTRY

The Uncomfortable Reality of Death Claims on Retirement Funds

	When a retirement fund member dies, the process of paying out benefits can be long, invasive, and emotionally taxing for families. While retirement funds offer many advantages, their governance under the Pension Funds Act introduces complexities that few members or dependants fully understand — particularly during times of grief. Why Trustees Control Death Benefits For all approved retirement fund products — pension, provident, preservation funds, and retirement annuities (RAs) — trustees have the final say over how and to whom benefits are distributed. Their duty is to identify all financial dependants of the deceased, whether nominated or not, and to allocate benefits in accordance with their dependency levels. By contrast, most living annuities and other life insurance products fall under the Long-term Insurance Act, where the policyholder’s nominated beneficiaries directly receive the proceeds without trustee intervention — making the process faster and more predictable. Two Real-Life Cases Case 1: A foreign national and company executive died without a will and without nominating beneficiaries on her retirement fund. Trustees must now search widely for dependants — legal, factual, and potential future ones — while fielding competing claims from relatives. The absence of a will and nominations has caused administrative chaos and delayed payouts. Case 2: In contrast, another deceased member had a valid will and clear nominations on two RAs. Even so, the trustees had to follow the statutory process of verifying all possible dependants. The family found the probing questions distressing, and the payout took a full year — but the trustees were acting within their fiduciary obligations. The spouse ultimately received the full benefit. Lessons and Practical Guidance Make a valid will. It guides trustees and reduces uncertainty, though it cannot replace formal beneficiary nominations on retirement funds. Nominate beneficiaries. Ensure all retirement fund and group risk benefits have up-to-date nominations. Prefer unapproved risk benefits. These payments are made directly to nominated beneficiaries, avoiding trustee delays. Consider living annuities. Their benefits are distributed under the Long-term Insurance Act and follow your nominations. Inform your family. Explain to loved ones how the trustee investigation process works to prevent shock and misunderstanding. Conclusion The death claim process under the Pension Funds Act is rigorous by design — to protect all dependants and ensure fairness. But without proactive planning, it can become a deeply uncomfortable ordeal for grieving families. Every member should take simple steps now to spare their loved ones unnecessary hardship later. Read the full article by Marius Fenwick in Moneyweb of 26 August 2025 here.
Timing of Dependency in Pension Death Benefits

	The Constitutional Court has handed down a landmark judgment in Mutsila v Municipal Gratuity Fund and Others (CCT 228/23), resolving long-standing uncertainty about when dependency must be assessed under section 37C of the Pension Funds Act 24 of 1956 (PFA). Background Section 37C requires fund trustees to identify and equitably allocate death benefits among a deceased member’s dependants and nominees. However, courts have differed on whether dependency should be determined at the member’s date of death or at the time of distribution. The Supreme Court of Appeal (SCA) in Guarnieri v FundsAtWork Umbrella Provident Fund had previously held that dependency could be determined as at the date of distribution — a view that has now been overturned. Facts of the Case Mr Takalani Mutsila, a member of the Municipal Gratuity Fund, died in 2012, leaving his civil-law spouse, Ms Tshifhiwa Mutsila, and five children. Another woman, Ms Masete, claimed to have been married to him by customary law and alleged that he supported her and her two children. The Fund allocated 52.5 % of the benefit to Ms Masete and her children, 22.5 % to Ms Mutsila, and 25 % to the five children, using dependency as at April 2014 (the distribution date). The Adjudicator set aside the allocation for lack of proper investigation, but after a series of appeals, the dispute reached the Constitutional Court. Key Legal Findings Timing of Dependency: The Court held unequivocally that dependency must be assessed at the member’s date of death, not at the time of distribution. “It would be absurd that someone who was not factually dependent on the member while they were alive could become a dependant after death.” Nature of Dependency: Legal dependants derive support by law (spouses, minor children, etc.). Factual dependants are those actually maintained by the member at the time of death. Once dependency exists, it remains recognised; later changes may only affect allocation proportions, not status. Trustee Obligations: Trustees must conduct diligent and objective investigations to identify all dependants based on circumstances at death, even if the distribution occurs months later. Rejection of Guarnieri Principle: The judgment expressly overrules the SCA’s Guarnieri interpretation, restoring consistency in dependency timing across all funds. Practical Implications for Funds Investigations under section 37C must focus on the factual circumstances at death. Subsequent financial changes (e.g., a dependant becoming self-supporting) may influence equitable allocation, but not the existence of dependency. Funds should document evidence contemporaneous with death — payrolls, affidavits, and household expenditure — to withstand review. This decision aligns section 37C’s operation with its social-security purpose, ensuring benefits reach those genuinely dependent on the deceased at the time of their loss. Conclusion The Mutsila case re-establishes legal certainty that dependency must be determined at death, not later, and that the trustees have a duty to investigate and protect genuine dependants within South Africa’s social security framework. Read the full article by Nicolette van Vuuren, partner at Webber Wentzel, in the Cover of 19 August 2025 here.


SNIPPETS OF GENERAL INTEREST

What Never to Include in Your Will

	A will is a vital estate-planning tool — but including the wrong provisions can cause confusion, delay, or even litigation. South African succession law is clear about what may not be dealt with through a will, and ignoring these rules can frustrate your final wishes. 1. Funeral Instructions By the time a will is read, the funeral has usually taken place. Rather, communicate your wishes directly to your family or a funeral parlour. 2. Trust-Held Assets Assets placed in a trust no longer form part of your estate and cannot be bequeathed. They are governed by the trust deed, not your will. 3. Life Insurance with Named Beneficiaries Where a beneficiary is nominated on a policy, proceeds are paid directly to that person and never form part of the estate. Mentioning them in your will can create legal conflict. 4. Retirement Fund Benefits Pension, provident, preservation, and RA benefits fall under section 37C of the Pension Funds Act. Trustees determine their distribution, not your executor, so these should not appear in your will. 5. Jointly Held Assets If married in community of property, only half the joint estate is yours to bequeath. Attempting to distribute the entire estate could invalidate portions of your will. 6. Unlawful or Unreasonable Conditions Conditions that restrict marriage, religion, or personal freedoms will be disregarded as contrary to public policy. Only lawful and reasonable conditions should be attached to inheritances. 7. Digital Assets Online accounts, crypto wallets, and social media platforms are governed by their own service agreements. Provide separate access instructions rather than including them in your will. 8. Illegal or Impossible Bequests Bequests involving unlawful actions or impossible conditions are automatically void and may complicate administration. 9. Pets Without Provision If you wish to leave pets to someone’s care, also allocate funds for their upkeep — otherwise, the instruction is impractical. 10. Personal Grievances A will is a legal document, not a family manifesto. Avoid airing disputes or explanations for exclusions, as these invite conflict. Final Thoughts A valid will ensures clarity; an overcomplicated one invites dispute. Keep it lawful, concise, and consistent with your other estate arrangements. Always consult a fiduciary or estate-planning specialist to ensure your will aligns with South African succession law and your broader financial plan. Read the full article by Hannah Myburgh in Moneyweb of 25 August 2025 here. Editor’s note: The author’s guidelines are equally relevant to Namibian wills as the laws are substantively almost identical.

From R5 million to Broke: How Retirees Destroy Their Wealth

	Many South African retirees exhaust their life savings within a decade of retirement due to avoidable mistakes. The key to financial longevity lies in maintaining what the article calls the Golden Equation: Investment returns ≥ inflation + fees + income drawdown. Ignoring this relationship can even lead to rapid depletion of large retirement pots. 1. Excessive Drawdowns The greatest destroyer of capital is drawing too much, too soon. Withdrawing 8% to 10% a year, while inflation and fees erode returns, can drain savings rapidly. The “4% rule”, validated by decades of global research, remains a reliable benchmark—drawing 4% of capital in the first year and adjusting annually for inflation can sustain income for 30 years or more. 2. High Fees Fees compound silently against retirees. A retiree paying 3% annually instead of 0.85% effectively loses over R100 000 per year on a R5 million portfolio. Over time, this difference can shorten the life of savings by more than a decade. Minimising fees across all service providers is therefore critical. 3. Underestimating Retirement Expenses Contrary to expectations, expenses often rise after retirement due to higher medical costs, early-retirement leisure spending, home maintenance, and persistent inflation. Without proper planning, these erode purchasing power and accelerate capital depletion. 4. Panic-Selling During Market Volatility Selling growth assets during downturns locks in losses and compromises long-term returns. Retirees should maintain an adequate growth allocation and hold two to three years’ income in cash to weather short-term volatility. A Real-World Illustration “John,” who retired in 2015 with R5 million, overspent, paid high fees, and exited the market after a downturn. Within 10 years, his savings fell to R500 000, and his drawdown rate reached 17.5%. His plight mirrors that of many retirees whose issue is not inadequate capital, but poor capital management. Key Lessons Respect the 4% rule. Cut fees aggressively. Stay invested in growth assets. Manage sequence-of-returns risk. Review your plan annually. The message is simple but profound: retirement sustainability depends on disciplined drawdowns, low costs, and long-term investment behaviour. The Golden Equation should guide every retiree’s financial plan. Read the full article by 10X Investments in Moneyweb of 5 November 2025 here.


AND FINALLY...

Wise words from wise men

	"He who has a why to live can bear almost any how.” ~ Friedrich Nietzsche (1844 - 1900)

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