The NBC Umbrella Retirement Fund (NURF) held its 3rd Annual Conference in Parktown on 14 September. NURF caters for the retirement savings of some 21,000 formal sector employees from employers of various sizes from a variety of industry sectors throughout South Africa.
“NURF membership is drawn from dichotomous cultural, education and financial backgrounds” said Sithemble Solo, NBC Holdings’ Executive Head for NURF. “The recent spate of publicity around preservation and default annuities, prompted us to settle with ‘Financial Freedom and Security’ as the theme for the conference” he added.
The conference’s keynote address was delivered by Tony Mercer, Executive Director of NURF Sponsor, NBC Holdings. Mercer conceded that saving was tough for everyone in the current economic climate, but insisted that it was essential for anyone in formal employment if any degree of financially freedom was to be achieved.
“Even though the taxation playing field has been recently levelled between all types of retirement funds and thus members of all types of fund are able to provide for retirement with pre-tax money in the same way, membership of a retirement fund is only one part one factor impacting the achievement of ‘financial freedom’”.
“‘Financial Freedom’ in its most rudimentary form is the ability to maintain one’s accustomed standard of living when no longer earning an income without the need for third party assistance – whether from the State, a family member or an NGO charity” he told the more than 100 invited delegates representing participating employers, NURF member representatives and trade union shop stewards and officials. “Seen like this, achieving ‘Financial Freedom’ may seem like a ‘long shot’ for many, but it is within the grasp of anyone fortunate enough to be employed and prepared to place his or her own welfare first and save, no matter how little it may seem”. Mercer said. “This is always a better option than responding to consumer stimulants and being lured into the consumer debt trap” he cautioned. “Consumer debt and ‘Financial Freedom’ are polar opposites”.
Mercer encouraged delegates not to be intimidated by their goals or to be put off by the political or market noise that screams barriers at us daily, but to make small lifestyle changes and begin saving today. “Time is your friend” he added.
Strategies for achieving for financial security and freedom were presented and discussed at the conference
Floyd Ntombela, NURF Principal Officer and an NBC Executive Head, said that members who preserved their retirement fund assets and kept them invested during their working lives would be rewarded in later life. Preservation would also greatly assist towards achieving financial security in retirement and relieve a massive responsibility on the State and reduce the tax burden for future generations.
He referred to a comprehensive study conducted by Human Sciences Research Council for the Financial Sector Conduct Authority (formerly the FSB) in 2015 and revealed that only a quarter of South Africans have funds set aside for emergencies. “Too many South Africans demonstrate a worrying lack of financial literacy and at best a mediocre understanding and ability to manage their finances”, said Ntombela.
Nelson Mandela stated that education was the most powerful weapon you can use to change the world. “NURF agrees and identifies fully with this statement by our beloved former President and it is in this sprit that NURF and NBC are committed to playing their small part in promoting knowledge around matters financial with members and other NURF stakeholders” Ntombela added.
Other speakers included Albert de Beer, an Independent Trustee of NURF with more than 35 years’ experience in employee benefits and human resources. He spoke about the practical challenges of savings and how South Africans loved “the bigger house, bigger car lifestyle” and, as a result, became victims of unnecessary credit use. “There is a dire need for financial literacy and awareness amongst members and South Africans generally” he said. “People need to learn more about planning, budgeting, saving and how this will benefit their lives”, said de Beer.
Mpho Ratseane, FAIS accredited Personal Financial Planner from NBC Personal Financial Services raised a concern about the declining number of South Africans who engaged in any long-term financial planning. “This is as trend across the entire population, irrespective of age, employment status or level of affluence”, Rateane stated. “Financial freedom is not about being wealthy as such. It is about making sure your money works for you and about taking charge of your financial destiny,” she advised. On the positive side, there does seem to be a greater urgency in both the retirement fund and broader financial services sectors to begin changing the mind-set of people towards active saving for their retirement and other short term goals from a passive and defeatist mind-set of consumption.
The conference concluded with a panel discussion by all speakers with active participation from delegates present. Delegates were reminded that the unlocking of Financial Freedom and Security is an individual responsibility that can, with focus and discipline, be achieved over time.
“All in all it was a positive and enlightening conference” said Solo.
Prepared by NBC Holdings Proprietary Limited
Contact: Seren Thomas
Telephone: 010 2060506