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A first-of-its-kind report reveals the extent of South Africa’s private retirement savings crisis and its pending impact on government resources in the coming years, as well as the savings disparity among racial groups and the massive divide between men and women.

The first 10X Retirement Reality Report (10XRRR) - the findings of a survey of more than 11-million South Africans - indicates that 46% of people have a profound lack of trust in the retirement industry, while 41% people have made no provision for retirement at all.

The report, commissioned by 10X Investments, reveals a profound lack of understanding of what they have saved and what they need to have saved among existing clients of the retirement industry.

The poll further highlights some worrying trends across within South African demographics.

  • 62% don’t have any form of retirement plan or have little understanding of their existing policy
  • 53% don’t know how much their pension is worth
  • 62% lack trust and confidence when it comes to investing money
  • Less than 35% of black respondents have a pension or provident fund
  • Less than 20% of black respondents have a retirement annuity
  • More than 40% of women across all demographics have no investments or savings in any form

Says 1X Investments Founder and CEO Steven Nathan, “The industry has amassed wealth at the expense of its clients, who frequently discover how poorly their retirement products have performed only when it is too late to do anything about it.

“The industry’s messaging makes strong emotive appeals. It’s high time that the facts get some air time,” he said.

The survey pointed to the gender pay gap in South Africa, where women are understood to earn around a quarter less than their male counterparts, which has a knock-on effect on retirement savings. The report noted that the gender pay disparity is often “exacerbated by the increased likelihood that women’s careers will be interrupted during pregnancy and child-rearing”.

A total of 36% of female respondents said they neither saved nor invested, and 37% saved cash but did not invest it. Very few women, a mere 16%, reported investing their savings in order to grow their wealth.

Emma Heap, Head of Growth at 10X Investments, said: “If women aren’t investing their money for growth they will have little chance of beating inflation and having enough money to draw a decent income after retirement.

“Hopefully the report will inspire women to take control of their finances and ensure their money is working as hard for them as they are for it.”

10X Investments believes that the release of the 10XRRR will promote action and awareness in addressing the underlying issues that are poised to financially cripple the South African economy and millions of individual South Africans.

The release of the 10XRRR comes amid heated debate on rising poverty levels in South Africa, despite government’s national development plan to eliminate poverty by 2030.

The report also aims to spark debate about the lack of transparency and, in some cases, daylight robbery committed by fund managers in terms of hidden costs and fees. 10X Investments is a disruptor financial institution that recognises that the retirement industry has done disproportionately well for itself, but has failed its clients.