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Momentum Corporate Preservation Funds

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That’s a difference of R8.5 million!

One of the key reasons why most South Africans are not financially independent during retirement is the failure to preserve their retirement savings when changing jobs.

Why should you choose the Momentum Corporate Preservation Funds?• Flexibility ensures trustees are able to craft a preservation solution that meets their members’ unique needs.• The Funds align fully to Government’s vision of encouraging trustees to assist members to make choices that will improve

their amount of savings at retirement.• Cost efficiency from economies of scale.• No initial fees are paid.• Attractive value-add benefits, available at no additional cost, which include:

- A funeral benefit of R15 000 which is paid on the death of the main member.- Access to Multiply, Momentum’s wellness and rewards programme.- Access to Hello Doctor, a mobile phone-based service that provides members with access to doctors, anytime,

anywhere.

Thabo now starts contributing R4 989 per month at his new job, with a contribution increase of 5% per annum towards his retirement savings until he’s 65. Thabo is now expected to have around R5.2 million at retirement.

If Thabo preserved his retirement savings, instead of withdrawing it, he would’ve had around R13.7 million at retirement.

R

Let’s take 30 year old Thabo that earns a salary of R240 000. His starting contribution towards his retirement fund is R2 400 per month with a contribution increase of 5% per annum and net investment growth of 10% per annum. Thabo aims to retire when he’s 65. At age 45, Thabo changes jobs and decides to cash in his retirement savings which is around R1.3 million.  

Hi, I am Thabo

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Flexibility for a unique solutionTrustees can select the option which is best suited to meet the needs of their members. Trustees can choose from a wide range of investment portfolios in each option. In this way, trustees can craft a preservation solution, uniquely tailored around the specific needs of their retirement fund and their members.

Option one: House ViewThis is the lowest cost option. Trustees can select from one of the four lifestages portfolios. Each portfolio targets a different post-retirement income strategy.

The portfolios are based on our outcome-based investing (OBI) philosophy. OBI achieves long term results by:• Reducing the investment risk through high levels of

diversification.

• Offering the highest possible inflation-targeting returns, for the lowest possible risk.

• Looking ahead instead of chasing historical returns.

• Putting members and their goals at the centre of the investment process.

The portfolios are:• With-profit annuity lifestages,

• Living annuity lifestages,

• Capital guaranteed lifestages, and

• Inflation-linked annuity lifestages.

One of these portfolios is selected as the default lifestages portfolio for all members withdrawing from their retirement fund. The choice typically reflects the retirement fund’s preferred post-retirement income philosophy. Withdrawing members are automatically defaulted to the chosen portfolio. The member can select one of the other lifestages portfolios down the line.

Option two: Flexible LifestagesThis option offers portfolios that can be used to design portfolios consistent with the retirement fund’s own investment philosophy. Available portfolios range from Regulation 28 compliant building blocks to structured and customised portfolios. Costs are kept low by limiting the choice to Momentum portfolios. Portfolios can also be combined in lifestages arrangements or remain on their own.

Option three: Core ChoiceThis option provides access to the portfolios available under option two, as well as limited external portfolios. The external portfolios have been carefully selected, based on the investment managers’ mandates and compliance with Regulation 28.

Option four: Open ArchitectureThis option is suitable for large retirement funds that require very high levels of customisation. The option offers a choice of more than 300 portfolios. Retirement funds with assets over R1bn or annual withdrawals in excess of R100m have access to this option. Individuals in any of the other options can also select option 4 at the standard asset-based fee.

Where options two, three and four are selected, the trustees either create their own customised lifestages portfolio, construct a unique portfolio or select a standard portfolio that will become the default portfolio for withdrawing members. They also have the option to put together default arrangements for different categories of members.

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Disclaimer

Copyright reserved © MMI 2018 - Momentum is a division of MMI Group Limited (registration number: 1904/002186/06), a wholly owned subsidiary of MMI Holdings Limited. The document is for illustrative purposes only and does not constitute tax, legal, accounting or financial advice. The user relies on the contents at his sole discretion. A person should not act in terms of the information in this document without discussing it with an authorised financial adviser and should seek personal, legal and tax advice. MMI Holdings Limited, its subsidiaries, including MMI Group Limited, shall not be liable for any loss, damage (whether direct or consequential) or expenses of any nature which may be suffered as a result of or which may be attributable, directly or indirectly, to the use or reliance upon this publication. Terms & Conditions apply. MMI Group Limited an authorised financial services and registered credit provider Reg No 1904/002186/06 (FSP6406)

08/2018

Members can make changesAfter selecting the trustee-preferred option, the member can choose to move out of the trustees’ selection. They can choose to:• Switch to option one and select one of the four default lifestages portfolios available, or• Switch to options two, three or four and invest directly in any of the portfolio building blocks in the selected option. If a

member selects option four they will pay the standard administration fee.

Members can change their product option and investment portfolios online at any stage, at no additional cost. Members on option one cannot split their assets across lifestages portfolios, which means that they must invest 100% of their assets in a single lifestages portfolio.

Value-adding benefits Trustees selecting the Momentum Corporate Preservation Funds will provide the following attractive value-added benefits to their members. These benefits help to improve members’ retirement outcomes and enhance their financial wellness.

• Funeral benefit Members preserving their retirement savings with the Momentum Corporate Preservation Funds have access to a funeral

benefit of R15 000 on the death of the main member. This benefit helps to incentivise mainly low-income earners to preserve their retirement savings in the Momentum Corporate Preservation Funds.

• Multiply Multiply is a wellness and rewards programme that helps members to make the right choices so that they can live a better,

healthier life, and also gives them the money to help them afford it.

All members of the Momentum Corporate Preservation Funds have access to Multiply Starter at no additional cost. This will allow them to enjoy great rewards from some of our partners like Dis-Chem, Edcon, NuMetro, Intercape and takealot.com.

To experience the real value of Multiply, members can upgrade to Multiply Provider or Multiply Premier at an additional monthly fee where they will enjoy even greater rewards from over 80 partners.

• Hello Doctor Members also have access to Hello Doctor at no additional cost. Hello Doctor is a mobile phone-based service that provides

members with access to doctors, anytime, anywhere.

In a nutshell, Hello Doctor:• Reduces costs. Our telephonic consultation has a resolution rate of 70%, saving patients’ time and money without

needing to see a doctor face-to-face.• Reduces absenteeism. With Hello Doctor being one phone call away, members can get medical advice and

resolution almost immediately.• Reduces presenteeism. A doctor’s advice and reassurance is often all people want to give them that much needed

peace of mind which helps them focus better in the workplace.• Health management. Hello Doctor’s regular heath education equips members to pay attention to their health and to

make better decisions about their lifestyle choices.

emailus@momentum.co.za

The content of this document does not apply to members leaving the FundsAtWork Umbrella Funds.

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