Guest Contributor | Apr 16, 2021 | 0
Pension funds must be accountable and transparent to their members – expert
The wild gyration in financial and stock markets since March has lead to concerns by pension fund members regarding the preservation of their investments and the state of pension funds in general.
However, the Managing Director of Retirement Fund Solutions (RFS), Marthinus Fabianus, this week gave the assurance that all funds under their administration are healthy. This also applies to the Benchmark Retirement Fund, an umbrella fund administrated and managed by RFS, of which Fabianus is also a trustee.
Fabianus said funds use a mix of investments that includes international and local asset classes such as investments in cash, money market instruments, bonds, shares and properties, etc. that are managed prudently to give the best possible returns and security to pension funds.
“Although there was a major sell-off of shares on the local, regional and international stock exchanges during March as a result of panic caused by the Corona pandemic, markets recovered after about a month,” he said.
“Stock market investors who buy high-risk shares in the hope of short-term gain may have lost value, [while] pension fund membership typically lasts thirty to forty years, and investments are managed to ensure very long-term growth, which continues in spite of short-term dips in the market, he explained.
Cautioning pension fund contributors not to withdraw their pensions early, Fabianus said this is one of the main reasons that a pension investment loses value. “When they make early withdrawals from their pension funds, although they gain cash in the short term, they lose the value of future growth and the future safety net for retirement,” he said.
“For members who are about to retire, the best strategy is to try to delay drawing until growth has resumed,” he said adding that Benchmark and RFS offer guidance and advice to members when they are about to retire.
Pension funds managed by RFS, and the Benchmark Retirement Fund invest in low to moderate risk investments across a range of asset classes to produce steady growth over decades to ensure financial wellness of the members upon retirement.
Fabianus further pointed out that funds are managed by a board of trustees, expertly administered and monitored by independent actuaries and independent auditors and there is a strong emphasis on governance, all under NAMFISA’s watchful eye as the regulator of pension funds.
“RFS and Benchmark keep their members informed of the performance of their investments with regular reports and newsletters,” Fabianus concluded.