How This Retirement Annuity Calculator Works

This calculator shows how much your retirement annuity (RA) could be worth at retirement, and what monthly income that could give you. You enter your age, the age you plan to retire, your gross monthly income, your current savings and your monthly contribution. You also choose an investment strategy. Under the advanced settings you can adjust yearly contribution increases, inflation, total fees, other retirement fund contributions and the drawdown rate you plan to use.

The results show your projected savings and your monthly pre-tax income in today’s money, your tax saving for the year, and the estimated cost of fees. A chart compares your fees with a lower-fee alternative.

Reading Your Results

• Projected savings at retirement: the estimated value of your RA, shown in today’s money so you can judge it against today’s prices.
• Monthly pre-tax income: what your savings could pay each month, based on the drawdown rate you chose.
• Tax saving: the tax you save this year because your contributions are deductible.
• Cost of fees: how much of your growth goes to fees over the years.
• Are you on track?: a comparison of your projected income with the income goal you set as a percentage of your salary.

Treat the results as an estimate. Returns are not guaranteed, and a few years of poor markets early on can change the outcome.

What Is a Sustainable Drawdown Rate?

If you buy a living annuity at retirement, you choose how much income to draw each year, between 2.5 percent and 17.5 percent of your balance. Drawing too much too early can use up your capital. ASISA’s guidance for the first decade of retirement is a prudent rate of about 4 to 5 percent, and below 8 percent in later years. Our guide to living annuities explains how this works, and the guaranteed annuity page covers the option that pays an income for life.

Your Tax Benefit

Contributions to a retirement annuity are tax-deductible up to 27.5 percent of your income, with a maximum of R430,000 a year from 1 March 2026. The deduction lowers your taxable income, so your tax saving is worth your marginal rate. If you also contribute to a pension or provident fund at work, those contributions share the same limit, which is why the calculator asks for other retirement fund contributions. Use our salary calculator to see how a higher contribution changes your take-home pay.

Why Fees Matter More Than They Look

Fees are charged on your whole balance every year, so a small difference compounds. Here is a simple illustration, not a forecast. Suppose you contribute R2,000 a month for 30 years and the investment grows at 10 percent a year before fees. With total fees of 1 percent a year, you would end with about R3.4 million. With fees of 2.5 percent a year, you would end with about R2.6 million. The difference of roughly R840,000 comes from the fees alone. Test your own fee level in the advanced settings to see your numbers.

What Happens When You Retire

• You can access a retirement annuity from age 55.
• Since 1 September 2024, new RA contributions are split under the two-pot system: one third goes to a savings component you can withdraw from once a tax year, and two thirds goes to a retirement component that is locked until retirement.
• At retirement, you can take up to one third of the vested and savings components as cash. The rest must buy an annuity.
• If your total retirement interest is R360,000 or less, you may take it all as cash.
• Legacy RA policies, taken out before the two-pot system, follow the old rules.

Read our guide to the choices when leaving a retirement fund for how each option is taxed.

Frequently Asked Questions

What is a retirement annuity?

A retirement annuity is a long-term savings product for retirement that you contribute to yourself. Your contributions are tax-deductible within limits, and the money is preserved until you reach retirement age, apart from the savings component under the two-pot system.

How much will my retirement annuity pay me each month?

It depends on your balance at retirement and on the annuity you choose. With a living annuity, you choose a drawdown rate between 2.5 percent and 17.5 percent a year. The calculator shows the monthly income for the rate you enter.

When can I access my retirement annuity?

From age 55. Since 1 September 2024, the savings component of new contributions can also be withdrawn once per tax year, with a minimum of R2,000, and the withdrawal is taxed at your marginal rate.

How much of my RA can I take as cash?

Up to one third of the vested and savings components, and the rest must buy an annuity. If your total retirement interest is R360,000 or less, you can take all of it as cash.

How do fees affect my retirement annuity?

Fees reduce your growth every year, so a small difference compounds over decades. The calculator estimates the cost of your fees and compares them with a lower-fee alternative.

Is this calculator financial advice?

No. It gives an estimate for general planning. For advice on your own situation, speak to a registered financial planner from our financial planners directory.

Explore our other retirement calculators from the calculators menu above. Tax rules last updated for the 2026/27 tax year. Figures are estimates and do not replace advice from a registered financial planner.