By Tokiso TKay Nthebe
You go to work.
Your payslip shows a retirement deduction.
You assume your money is growing safely somewhere.
But here’s the uncomfortable question:
Is your employer actually paying those contributions over to the pension fund?
As a member of a pension or provident fund, your employer deducts retirement contributions from your salary every month. In many cases, they also add an employer contribution. But your retirement security does not end with a deduction on your payslip.
For your money to grow, those contributions must be paid to the fund and invested — on time.
And ultimately, the responsibility to retire with enough money rests with you.
First, What Are Employee Benefits?
Employee benefits are the financial protections attached to your job. They usually include:
- Retirement benefits (pension or provident fund)
- Risk benefits such as group life cover and disability cover
Your retirement benefit is likely one of your biggest financial assets. It is designed to provide income when you stop working.
Your risk benefits protect your family if you pass away or become disabled while employed.
These are not small perks.
They are pillars of your long-term financial security.
That is why they must be safeguarded and managed properly.
The Minimum You Should Be Contributing
If you want to retire comfortably, you should aim to contribute at least 15% of your monthly income towards retirement (including employer contributions).
But contribution percentage alone is not enough.
Your money must:
- Be deducted correctly.
- Be paid over to the retirement fund.
- Be invested without delay.
If any of these steps fail, your retirement savings suffer.
The Growing Problem: Contributions Deducted but Not Paid
One of the most worrying trends in the retirement industry is this:
Some employers deduct retirement contributions from employees — but delay or fail to pay them to the fund administrator.
This is not a small administrative issue.
It can seriously damage your future retirement income.
In South Africa, Section 13A of the Pension Funds Act requires employers to pay contributions over within a prescribed period.
In Lesotho, Section 29(1) of the Pension Funds Act requires that contributions be paid to the fund within seven days after deduction.
These laws exist to protect members like you.
When contributions are not paid on time, members are financially disadvantaged.
How Delayed Contributions Hurt You
Let’s make this practical.
1️⃣ You Lose Investment Growth
Retirement savings grow because of compound interest — where your money earns returns, and those returns earn returns.
When contributions are delayed:
- Your money is not invested.
- It is not growing.
- You lose out on valuable compounding time.
And time is your biggest advantage in retirement planning.
2️⃣ You Risk Retiring With Less Money
If delays happen repeatedly over many years, the impact becomes significant.
Even small delays can reduce your final retirement capital.
That means:
- Less money saved
- Lower income in retirement
- Greater financial stress in your later years
3️⃣ Your Pension Income Will Be Lower
When you retire, your savings are used to buy an annuity (a monthly income for life).
Lower retirement capital = lower monthly pension income.
That directly affects:
- Your lifestyle
- Your medical affordability
- Your independence
4️⃣ Opportunity Cost
Markets move every day.
If contributions are invested late:
- You may miss positive market growth.
- You may enter the market at an unfavourable time.
Either way, you lose control over the timing of your investment.
And in retirement planning, timing matters.
What Can You Do As a Member?
This is where you step in.
Do not leave your retirement entirely in your employer’s hands.
Here is what you should do:
✅ 1. Review Your Payslip Monthly
Check that retirement contributions are being deducted correctly.
✅ 2. Check Your Benefit Statement
Ensure contributions are reflected and up to date.
If you don’t receive benefit statements regularly, request them.
✅ 3. Ask Questions
- Are contributions paid on time?
- Who is the fund administrator?
- Who are the trustees?
- How can you report concerns?
Financial literacy is power.
✅ 4. Attend Fund Education Sessions
Join webinars or seminars hosted by your fund or administrator. The more you understand your fund, the more protected you are.
✅ 5. Make Voluntary Contributions
If you are behind on your retirement target, increase your contributions where possible.
Do not rely only on the minimum.
The Hard Truth
Your employer facilitates your retirement savings.
But you own the outcome.
Retirement is not something that “happens” automatically because you have a job.
It requires:
- Awareness
- Monitoring
- Accountability
- Personal responsibility
You cannot outsource your future.
Final Thought
Your retirement savings may be your largest financial asset.
Protect it.
Monitor it.
Understand it.
And hold those responsible accountable.
Because one day, your salary will stop.
Your retirement income will not be based on what was deducted.
It will be based on what was invested.
If you are unsure whether your contributions are up to date, contact your fund administrator and request confirmation.
Your future self will thank you.
Tokiso TKay Nthebe is an author, podcast host, financial coach, and lead advisor at TKO Financial Wellness & Advisory, who guides professionals who are overwhelmed by investing and retirement information – and have disposable income to invest- to gain clarity, control, and a plan they trust, so they can make their money work for them while preparing for retirement.
Visit www.tkofinancialwellnessacademy.com or email info@tkofinancialwellness.com for personalised coaching and resources.
2 Comments.