Turn your Profit-Share into a retirement asset

Research has shown that as a PPS member, you may live longer than the average South African. Therefore, your retirement plan is key to helping ensure that your retirement income lasts throughout your retirement years. One of the many benefits of being a PPS member is that you have access to a unique benefit that can be used to augment your retirement plan. Like many other PPS members, you could also consider the PPS Profit-Share Account as a fundamental component of your retirement plan.

What is the PPS Profit-Share Account?

PPS has no external shareholders and operates under the ethos of mutuality aimed at adding value to you (as a PPS member). The PPS operating profit and the investment return thereon is shared each year by means of profit allocations into the qualifying members’ PPS Profit-Share Accounts. As a PPS member, you get allocation from having qualifying life products with PPS Insurance and can then earn profits from holding products with PPS Investments, PPS Short-Term Insurance and Profmed (through allocations from PPS Health Care Administrators) and earn additional Profit-Share by activating the Profit-Share Cross-Holdings Booster.  

From the age of 60, the profits you have accumulated through the PPS Profit-Share Account over the course of your PPS membership will be vested in your name via the Vested PPS Profit-Share Account. Once your PPS Profit-Share Account vests, you are able to use your accumulated profits through the Vested PPS Profit-Share Account as part of your retirement planning. This offers a unique advantage of supplementing your retirement savings with Profit-Share assets whilst you continue receiving profits on all the qualifying products that you hold.

An opportunity to align your Profit-Share with your retirement plan through Portfolio Choice

During your membership, the PPS Profit-Share Account is invested on your behalf. After the age of 55, you can choose how your portion of the Profit-Share assets are invested in one of seven portfolios. As you get closer to retirement, this gives you the opportunity to choose how your accumulated profits are invested and to align it to your retirement goals.  

Each of the seven portfolios has a specific mandate and investment time horizon, which can be used to determine which option best aligns to your holistic investment strategy as part of your retirement savings plan. The opportunity to exercise your PPS Profit-Share Account Portfolio Choice will be provided once a year (effective from 1 January) until you reach retirement.  

Visit https://www.pps.co.za/invest/portfolio-choice for more information on the Portfolio Choice options.

What happens after Portfolio Choice?

Once you retire or cancel your PPS Provider Policies, your accumulated profits vest and become accessible through the Vested PPS Profit-Share Account. Your Portfolio Choice selection continues into your Vested PPS Profit-Share Account.  

How can the Vested PPS Profit-Share Account be used in retirement?

By vesting, members have the unique opportunity to:

• Keep their PPS Profit-Share Account assets invested for longer to generate further returns and capital growth.
• Continue sharing in the profits in retirement (attributable to PPS Investments).

• Use the Vested PPS Profit-Share Account as part of their retirement planning.  
• Supplement their post-retirement income by combining regular withdrawals from their Vested PPS Profit-Share Account with PPS Living Annuity income payments, allowing their annuity capital to last longer.
• Pay PPS Insurance, Profmed and PPS Short-Term Insurance premiums.
• Maximise the tax benefits as withdrawals are net of tax and therefore the tax reporting is not the members’ responsibility.  
• Benefit from efficient estate planning as the proceeds of the Vested PPS Profit-Share Account will flow directly to their beneficiaries and not via their estate upon death.  

Unique retirement benefit for PPS members

As a valued PPS member, we encourage you to make the most of your Profit-Share assets accumulated over the duration of your membership. They can be used to augment your retirement savings and could help to ensure that your retirement income lasts throughout your retirement years. Take this opportunity to align how your Profit-Share is invested and turn it into a valuable retirement asset.