Membership

Category C – Members can contribute either 7.5% or 9% of their pensionable salary dependent on your conditions of service.
Category A – Members contribute 2% of their pensionable salary

The administration cost which goes towards the day-to-day running of the fund only amounts to 0.5% of pensionable salary and is deducted from the employer contributions.

Member contributions + Employer contributions - Risk cover and administration cost + Investment returns = Fund credit

This is the costs that is deducted for the death, disability and funeral cover and is determined by the risk cover option elected by the member. The risk cover and administration costs are deducted from the employer contributions

Member and employer contributions are fixed and calculated on the member's pensionable salary. Members have the option to make Additional Voluntary Contributions (AVCs) towards the fund to enhance their retirement savings. The monthly AVCs are deducted from the member's salary by the employer and paid to the fund and forms part of the member's fund credit to which monthly interest is allocated.
The member determines the additional amount he/she would like to contribute extra every month and arranges the deduction directly with the municipality's salary department by completing the Additional Voluntary Contribution Instruction-form.

The member is covered, and the benefit payable is determined by the risk option elected. Please note

• The disability benefit is subject to the insurer’s approval and reduces with 1.67% per month from age 60 to 65.
• Death benefit payments are subject to Section 37C of the Pension Fund’s Act, which means the last will and testament, although considered for information purposes, does not determine how a payment is made. The nomination form, however, plays an important role as it is used as an important guideline when the trustees decide on who the benefit should be paid out to.

Please update your beneficiary information. The information is treated as strictly confidential by the fund and the forms are available on the fund website and from the fund’s offices.

The member, spouse/registered life-partner and qualifying children are covered for the funeral benefits, irrespective of the risk cover option elected. Please refer to the brochures for the cover on Category C and Category A. NFMW-members have the option to make use of any of the voluntary funeral benefits, which include :

• Burial packages structured to your individual needs (Download brochure & Application form)
• Funeral cover for parents, parents-in-law and up to eight extended family members (Download brochure & Application form)
• Funeral cover conversion option which allows members to continue with their funeral cover when they resign, are retrenched or retire (Download application form).

These products are voluntary and, should any of the products be taken up by an NFMW-member, the relevant agreement will be between the member and the service provider and falls outside the rules of the fund. The number of family members you wish to insure and the amount and type of cover/burial package you choose, will determine the monthly premium payable to the external service provider by direct debit order. Please refer to the brochures above for costs and the applicable policy terms and conditions

Members must ensure that their life partners are registered with the fund, by completing and submitting the Application for Registration of a Life Partner-form to qualify for the funeral benefit. The qualifying spouse/life partner must be older than 15 and younger than the age of 75 when a member joins the fund to qualify for the funeral benefit.

• Check your latest benefit statement, it will provide you with the risk cover category as at the date of the statement, including the death and disability benefit payable.
• Contact the fund's offices telephonically, via e-mail to info@nationalfund.co.za or through the Contact us-form on the fund's website.
• Members registered for the interactive service can view their risk cover category online.

Members can decrease their risk cover option at any time. Increases are also allowed at anytime (subject to underwriting) or within 2 months of a life event (proof required). No increases after age 55. Changes take effect on the 1st of the following month.

Death, disability, and funeral cover cease when a member ends service or at age 65. Should a member die whilst in service his family will remain covered for the funeral benefit until the member would have attained the age of 65.

Members younger than the age of 55 who resign, are dismissed or retrenched are entitled to the following withdrawal benefit.

Vested Component

The member has the following options, based on the rules before 1 September 2024:

- Take a cash lump sum
- Transfer the benefit to another approved fund
- Preserve the benefit for later
- Combine these options (cash and transfer)

Any cash withdrawal will be taxed according to withdrawal tax tables.

Savings Component

- If a withdrawal was already taken during the tax year and the remaining balance is less than R2 000, the member can withdraw the full amount.
- If the balance is R2 000 or more, another withdrawal can only be made in the next tax year.
- If no withdrawal was taken yet, the full amount in the Savings Component can be withdrawn.

Retirement Component

No withdrawals are allowed from the Retirement Component until retirement.

Members who terminated service with a participating Local Authority, but immediately joins another participating Local Authority, have the option to choose whether to retain their benefit in the Fund or take it in cash as explained above.

Normal retirement age in the fund is at the age of 65 years, but a member can go on early retirement from the age of 55.

AT RETIREMENT

Normal retirement is at age 65 years or as per conditions of service and early retirement from the of age 55 years. At retirement members are entitled to the following retirement benefit.

Vested Component

- Old Money (vested benefit): This includes all contributions made to the Fund before 1 March 2021, as well as any interest or growth accumulated on those contributions. This amount is payable as a lump sum.
- New Money (non-vested benefit): This refers to contributions made to the Fund between 1 March 2021 and 31 August 2024, along with the interest or growth on those contributions.
  - 1/3rd can be taken as a lump sum.
  - *2/3rds must be taken as an annuity/pension.

plus

Savings Component

Any benefits left in the savings component at retirement can be taken as a cash lump sum. Alternatively, it may be transferred to the retirement component at retirement and taken in the form of a compulsory annuity/pension.

plus

Retirement Component

100% of the benefits in the retirement component must be taken in the form of a compulsory annuity/pension at retirement, that will be taxed as an income.

*Exception: Members may take a cash lump sum if the total value in the retirement component plus two-thirds of the non-vested ("new money") benefit in the vested component does not exceed R165,000 (the de minimis amount as prescribed in the Income Tax Act).

Members who were 55 years and older and who did not opt into the two-pot system retain the option to receive their full retirement benefit as a lump sum, provided they remain members of the NFMW until retirement.

Members who have reached normal retirement age can defer their retirement, subject to the conditions of the employer. Contributions will continue to be paid during this time.