FNB Retirement Insights Survey 2025 paints a worrying picture

Financial advisers won’t be surprised to hear that most South Africans are vastly under prepared for retirement. The FNB Retirement Insights Survey 2025 sheds light on the worrying gap between South Africans’ retirement expectations and their levels of preparedness. The third annual survey revealed that while more South Africans now claim to have a retirement plan, only 10% intend to fully retire at 60.

Among respondents under 60, 60% reported having a plan, but financial constraints and rising costs often derail their retirement goals. With contributions to retirement annuities dropping from 51% to 34% for middle-income earners, debt pressures and daily living expenses are taking priority.

Emerging Trends in Retirement Planning

Gaps Between Expectations and Reality

While younger South Africans may expect to replace 75% or more of their income in retirement, the experiences of older adults paint a different picture. Many over-60s are staying in the workforce longer, cutting back expenses, or relying on their adult children for support.

Lytania Johnson, CEO of FNB Personal Segment, highlights the urgency of this issue:
“There’s a positive shift toward retirement planning, but awareness alone won’t secure the future people want. Financial institutions have a greater role to play in turning plans into actionable steps.”

Procrastination and Emotional Barriers

The study found that procrastination is a major barrier for those unsure of where to begin. Sizwe Nxedlana, CEO of FNB Private Segment, explains, “People don’t avoid retirement planning because they don’t care – it feels overwhelming and too far away. Breaking this into bite-sized, manageable steps is essential.”

Persistent stressors include increasing living costs, future health expenses, and concerns about whether savings will last. Additionally, some retired respondents reported feelings of regret or loss of purpose due to inadequate planning.

Insights into Estate Planning

While 60% of respondents have funeral cover, only 40% hold a signed Will. Widespread myths surrounding Wills persist, including the belief that they are only needed by the wealthy. A third of South Africans have never considered drafting a Will, often due to time constraints or uncertainty around inheritance matters.

Nxedlana emphasises, “A Will is not just for the wealthy – it protects your family in the long term. Just as funeral cover eases immediate burdens, a Will provides stability during difficult times.”

The Two-Pot retirement system update

The survey introduced encouraging findings about the Two-Pot Retirement System:

• Public Awareness: Nearly 70% of respondents are aware of the new structure.
• Savings Behaviour: Encouragingly, under 30% of participants have withdrawn savings from their pots.
• Mindset Shift: Among those who haven’t withdrawn, 43% plan to keep their retirement savings untouched, revealing a growing understanding of long-term financial stability.

However, Nxedlana warns, “If seen as an emergency fund instead of a long-term savings tool, the Two-Pot system could lose its purpose. Educating people on the importance of leaving their savings intact is critical.”

A broader rethink around retirement

The research also uncovered significant shifts in how South Africans view retirement:

• More than 50% of respondents expect to supplement retirement income through part-time work or side hustles.
• Bank platforms now surpass social media and peer groups as the preferred source of retirement advice, reflecting the demand for user-friendly tools and professional guidance.

Nxedlana believes this reflects a generational shift:
“People today are seeking options, not just products. They want greater control, lower fees, and guidance tailored to their needs. FNB is committed to providing the tools and support that empower them to act.”

Steps toward a healthier retirement plan

The FNB Retirement Insights Survey 2025 reveals that while there is no one-size-fits-all solution for retirement, there are practical steps to get started:

1. Start Small, Start Now: Breaking a retirement plan into manageable portions can reduce anxiety and build momentum.
2. Educate Yourself: Use tools and platforms from trusted financial institutions to make informed decisions.
3. Draft a Will: Ensure your long-term intentions are carried out and your family is protected.
4. Avoid Premature Withdrawals: Keep your retirement savings intact to secure financial stability.
5. Consider Supplemental Income: Explore part-time jobs or side hustles to bridge any income gaps during retirement.

Bridging the gap between awareness and action

The findings of the FNB Retirement Insights Survey 2025 serve as a wake-up call for South Africans. While awareness about retirement planning has improved, there’s still a long way to go in translating plans into effective strategies.

As Sizwe Nxedlana concludes, “There isn’t a single fix for retirement, but there are bite-sized steps for everyone to take. At FNB, our focus is on helping clients go from just having a plan to having a good, actionable plan.”

In uncertain times, taking small yet consistent steps toward a more secure retirement can make all the difference.