Africa-Press – Botswana. Pension play a vital role in ensuring financial security in future. Therefore, it is crucial to make well informed decisions when it comes to managing pension fund.
Botswana Public Officers Pension Fund (BPOPF) chief executive officer Mr Moemedi Malinda made the call during an engagement with public officers in Maun on September 26.
He said the purpose of pension was to provide income during retirement thereby contributing to a reasonable standard of living.
“Pension is very critical in your lives and you should use it wisely to sustain yourself longer after retirement. I also encourage you to seek information,” he said.
He said while most people identify a financially secure retirement as one of their primary financial goals, some perceived it the other way round.
Mr Malinda said since the new pension fund law had some changes, individuals should carefully consider their circumstances before deciding to make early withdrawals of accrued pension benefits.
Members have the choice to either re-invest their retirement savings or take a portion in cash but he pointed out that if the cash was above one third, it would be subjected to tax. The act also allows active members to claim 25 per cent of their savings upon resignation, transfer from one fund to another or upon retrenchment or dismissal
He also urged all members to take the ‘Know Your Client’ (KYC) document seriously, emphasising the importance of the process in combating money laundering and preventing the financing of terrorist activities.
This is also in accordance with the Financial Intelligence Act of 2022, which required the fund to ensure that its members were KYC complaint.
Chief financial officer, Ms Kegaisamang Dire said by making proper decisions, officers would be able to use their pensions wisely and have dignified lives.
She said they should determine and firm up on expense level even if the new law allowed them to withdraw up to 50 per cent.
BPOPF director for member benefits Ms Mercy Robinson appealed to members to take responsibility in ensuring that their personal files submitted to the fund provided the necessary information to avoid delays in processing of payment at retirement time.
The fund, she said had to pay the retirement claim benefits in six weeks but at times they experienced challenges because the file either had incorrect personal information, invalid banking details or default in tax returns.
“Correct and accurate personal information protects the member and the fund from errors and allows the administrator to processes correct pension benefits without delay,” she added.
Chief investment officer, Mr Tshepang Loeto apprised the gathering on the newly introduced Tshomarelo Member Choice product which he described as member choice investment option for members nearing retirement.
The portfolio, he said was created to allow members to preserve their accumulated fund credits before they could switch to the pre-retirement switch portfolio adding that only members left with five years before retirement were eligible to make the transfer into the portfolio.
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