Retirement Fund: Benefits


On a monthly basis your and the employer's contributions are paid to the fund. The risk cover cost (this is the cost of the death, disability and funeral cost) and administration costs are deducted from the employer contributions and investment returns are added.

What percentage of my pensionable salary will I contribute on a monthly basis?  You can contribute either 7.5% or 9% of your pensionable salary dependent on your conditions of service.

What is the percentage deducted from the contributions for administration cost? The administration cost which goes towards the day-to-day running of the fund only amounts to 0.5% of pensionable salary and is deducted from the employer contributions. 

Risk cover - Death, disability and funeral benefits

The fund provides members with the option to elect the amount of death and disability cover, by choosing between the four available categories. The risk cover costs are determined by the risk option selected and deducted from the employer contributions.

Death benefits

In the case of the principal member’s death the following benefit is payable:

  • C1  = A lump sum of 1 x annual pensionable salary + fund credit or;
  • C3 = A lump sum of 3 x annual pensionable salary + fund credit or;
  • C5 = A lump sum of 5 x annual pensionable salary + fund credit or
  • C0 = Choice of no cover, only fund credit payable

Death benefit payments are subject to Section 37 C of the Pension Funds Act, which means that the last will and testament, although taken into account for information purposes, does not determine how a payment is made. The nomination form, however, plays an important role when the trustees make a decision on who the benefit should be paid out to. Members are encouraged to ensure that their beneficiary information is updated on a regular basis.

Disability benefit

The following benefit is payable in the case of a disability claim being accepted by the insurer:

  • C1 = A lump sum of 1 x annual pensionable salary + fund credit or;
  • C3 = A lump sum of 3 x annual pensionable salary + fund credit or;
  • C5 = A lump sum of 3 x annual pensionable salary + fund credit or
  • C0  = Choice of no cover, only fund credit payable

You have an option to change your risk category twice a year effective 1 January or 1 July and when your personal status change. Medical underwriting may be required for changes from a lower to a higher risk category. 

Funeral benefit

From the 1st of July 2019 all members and their qualifying family members, irrespective of the risk cover category elected are covered for the following funeral benefits;

  • Main member:  R 48 500
  • *Qualifying spouse/life partner: R 48 500
  • Qualifying child 6 years and older (above 21 years of age must be a full time student, unmarried and/or disabled): R 24 250
  • Qualifying child from 26 weeks of pregnancy until 6 years: R 11 000 

*The qualifying spouse/life partner must be older than 15 and younger than the age of 75 when the member joins the fund to qualify for the funeral benefit. Members must ensure that their life partners are registered with the fund, by completing and submitting the Application for Registration of a Life Partner-form in order to qualify for the funeral benefit.

Death, disability and funeral cover cease when a member ends service or at the age of 65.

Repatriation benefit

This is an included service available on the death of a member or qualifying family members. It is available 24 hours a day, seven days week and offers the service of transporting the deceased, via road and/or air to place of burial within South Africa. This service is available from anywhere in South Africa, Lesotho, Swaziland, Zimbabwe, Botswana, Namibia and Mozambique.   To claim, please contact the insurer on 086 0004 080, quote the name and ID of the deceased, name of fund and place where death occurred.

Voluntary funeral cover and burial packages

NFMW-members have the option to make use of any of the voluntary funeral benefits, which include:

  • Funeral cover for parents, parents-in-law and up to eight extended family members
  • Burial packages structured to your individual needs
  • Funeral cover conversion option which allows members to continue with their funeral cover when they resign, are retrenched or retire

These products are voluntary and, should any of the products be taken up by an NFMW-member, the relevant agreement will be between the member and the service provider and falls outside the rules of the fund. The number of family members you wish to insure and the amount and type of cover/burial package you choose, will determine the monthly premium payable to the external service provider by direct debit order. Please refer to the brochures below for costs and the applicable policy terms and conditions.

Retirement benefit

Normal retirement is at age 65 years or as per conditions of service.  You can, however, retire 10 years’ prior to normal retirement age, from the age of 55. When you retire, your fund credit will be available to you as lump sum. The benefit is subject to tax. Please contact the fund for more information on the “NFMW Golden income life annuity” underwritten by MMI and the “NFMW Living annuity”.

Did you know? The National Fund for Municipal Workers is registered as a Paragraph A-fund, which allows for a special tax dispensation for members with service years prior to March 1998.

Withdrawal benefit

If you resign voluntarily or are dismissed, your fund credit will be paid to you as a lump sum. There is no restriction on the number of years’ service and no penalties payable. The benefit is, however, subject to tax. The fund encourages our members to always preserve their retirement savings and to consult with a professional financial advisor regarding investment options available.

Retrenchment benefit

Your fund credit will be paid as a lump sum.


Smallest of: Normal retirement age (65) minus actual age X 8% X fund credit or  Fund Credit

Housing loans

The fund understands the need for housing and issue housing loan guarantees. The guarantee is limited to maximum of 60% of the member’s fund credit as a collateral through a specific financial credit provider. The loan must be used for housing purposes i.e. renovating of property, purchasing of property and/or a plot and for the settlement or partial settlement of an existing bond.

Absa Workplace Benefit

ABSA offers NFMW - members financial service solutions, which include exclusive discounts on vehicle finance, home loans and personal loans. For more information contact Workplace Banking Direct on 0860 556 556. Remember your NFMW membership card or latest benefit statement when engaging with ABSA and to quote the NFMW group scheme code: 10682. Terms and conditions apply.

Sanlam Reality Access  Loyalty Programme

NFMW-members automatically qualify for benefits and savings through the Sanlam Reality Access loyalty programme which rewards members for living a financially responsible life. Benefits include funeral support, legal assistance, emergency medical support, trauma, assault and HIV assist, discount coupons, online calculators and tools. Contact 0860 732 548/9 for more information on how to access these and other exclusive lifestyle benefits.