The Association of Savings and Investment in South Africa (ASISA) has developed a standardised Retirement Savings Cost (RSC) Disclosure methodology to assist potential and existing participating employers and/or boards of trustees when comparing quotations and costs from different umbrella fund providers that are members of ASISA.
The need for a RSC Disclosure methodology will regulate the way umbrella fund providers state their cost. In the past costs were stated in different formats that made it difficult to compare providers and certain costs were not stated at all.
The RSC Disclosure is a simplified and practical illustration of the estimated retirement savings costs at an employer level, allowing for more consistent comparison of costs across the industry.
Greater transparency will allow employers to shift their focus onto evaluating capabilities, which alongside competitive fees, collectively act to deliver financial resilience to members.
The Sanlam Umbrella Fund has welcomed the introduction of the RSC Disclosure standard and was the first major umbrella fund to implement this methodology. From 1 September 2019, all members of ASISA are compelled to abide by the RSC Disclosure and we believe that this will be a turning point in the evolution of the umbrella fund industry. We anticipate that many employers will request a review of their existing umbrella fund arrangements on a comparative basis to ensure that their fees are reasonable and competitive for the value being delivered.
To equip employers in making sense of the methodology, Sanlam has developed the RSC Disclosure Guide. The guide will assist employers and their consultants with making informed decisions. Employers should contact their Contracted Benefit Consultant for more information.
To read the full media release on the RSC Disclosure methodology, click here.