Preservation Funds
What Is a Preservation Fund?
A preservation fund is a specialised investment vehicle that allows you to preserve your retirement savings when you leave an employer's pension or provident fund.
It ensures your capital continues to grow in a tax-efficient structure until you reach retirement age, without triggering withdrawal taxes unnecessarily.
How Preservation Funds Work
Transfer from Pension/Provident Fund
When changing jobs or leaving employment, your accumulated pension or provident fund benefits can be transferred into a pension preservation fund or provident preservation fund
Invested in CIS, PSPs, Wrap Funds
The capital remains invested in collective investment schemes, wrap funds, and personal share portfolios (PSPs)
Grows Until Retirement
Your savings continue to grow until you access them at retirement
Withdrawal Rules and Access
- You may make one pre-retirement withdrawal from your preservation fund
- Any further access is only allowed at retirement age (55+)
- Withdrawals are taxed according to the retirement lump sum tax tables
- On retirement, the same rules apply as for other retirement funds (one-third lump sum, two-thirds annuity)
Benefits of a Living Annuity
No Tax While Invested
No tax on interest, dividends or capital gains within the fund
Growth is Tax-Free
Growth compounds free of tax until retirement
Why Use a Preservation Fund?
- Avoid cashing out and losing your retirement capital
- Maintain long-term compounding
- Retain your tax benefits
- Flexible investment choice while preserving your wealth
Why Choose Warwick Wealth
- Specialists in pension and provident preservation funds
- National network of retirement investment advisors
- Tailored investment strategies and active monitoring
- Partnership with Orion Investment Managers for institutional-grade asset management
Related Retirement Planning Services
Retirement Annuities
Build retirement capital before you retire with tax-deductible contributions and protected savings.
Preservation Funds
Preserve your retirement savings when changing jobs and maintain tax benefits.
Comprehensive Retirement Planning
Combine pre- and post-retirement strategies for a secure financial future.
Start Your Preservation Fund Journey
Preserve your hard-earned savings and secure your retirement future. Book a consultation with a Warwick Wealth retirement investment advisor today.
Frequently Asked Questions (FAQ)
What is a preservation fund?
A preservation fund is a specialised investment vehicle that allows you to preserve your retirement savings when you leave an employer's pension or provident fund. It ensures your capital continues to grow in a tax-efficient structure until you reach retirement age, without triggering withdrawal taxes unnecessarily.
How does a preservation fund work?
When changing jobs or leaving employment, your accumulated pension or provident fund benefits can be transferred into a pension preservation fund or provident preservation fund. The capital remains invested in collective investment schemes, wrap funds, and personal share portfolios (PSPs). Your savings continue to grow until you access them at retirement.
Can I withdraw from a preservation fund?
You may make one pre-retirement withdrawal from your preservation fund. Any further access is only allowed at retirement age (55+). Withdrawals are taxed according to the retirement lump sum tax tables. On retirement, the same rules apply as for other retirement funds (one-third lump sum, two-thirds annuity).
What are the tax benefits of a preservation fund?
No tax while your capital remains invested. No tax on interest, dividends or capital gains within the fund. Growth compounds free of tax until retirement. Funds are protected from creditors and excluded from estate duty.
How is a preservation fund different from a retirement annuity?
Preservation funds are used when changing jobs and do not allow new contributions, but permit one pre-retirement withdrawal. Retirement annuities allow ongoing contributions while you're working, offer tax-deductible contributions, but do not allow any access until age 55+.
Expert Preservation Fund Guidance
Preserve your hard-earned savings and secure your retirement future. Book a consultation with a Warwick Wealth retirement investment advisor today.
Trusted Advisors
Expert guidance from experienced retirement investment advisors
Tailored Solutions
Customized preservation fund strategies for your unique needs
Ongoing Support
Continuous monitoring and support for your retirement investment plan