Two-pot: weigh the outcome

WISDOM: BEFORE DIPPING INTO YOUR RETIREMENT SAVINGS THINK HARD IF IT'S NECESSARY

Although fund managers have already paid out billions to millions of pension fund members who chose to withdraw funds from their saving pools under the two-pot retirement system, experts are still warning consumers who have not yet applied to withdraw to think twice before dipping into their saving pots.

Just like in the fairytale of the magic porridge pot that would not stop cooking, the two-pot lid is off and the proverbial floodgates are open. According to the latest report from the South African Revenue Service, more than R21.4 billion has already been withdrawn from members' retirement savings, with an excess of one million withdrawal applications approved and counting.

While consumers will use the majority of these funds to settle short-term debt, according to Momentum's financial advisors, there are some who will use the money for non-essential purposes, such as travel.