Water is joining medical aid as a major threat to retirement affordability. In 2019, about 31 kL (1kL per day) cost roughly R636. Today, a comparable bill is around R2,267 — more than tripled in under six years. This isn’t just price inflation; tariff structures (inclining blocks, higher fixed and sanitation charges) now push ordinary households into costlier tiers even at similar usage.

Why this matters for pensions

– Retiree inflation > CPI: Pensions and annuity increases often track CPI, but retirees spend more on healthcare and utilities — items rising far faster.

– Essentials crowd out the budget: Medical aid and water are non-discretionary. As they climb, they force higher withdrawals or painful cuts elsewhere.

– Longevity risk: Early spikes in essential costs accelerate portfolio drawdowns, shortening how long savings last.

What can you do?

– Rebase your plan: Model a personal inflation rate for essentials. Stress-test with 10–12% for medical aid and 15–25% for water/utilities.

– Adjust withdrawals: If you’re on a living annuity, consider flexible withdrawals tied to your essential-cost index, not headline CPI alone.

– Cut exposure: Fix leaks, install low-flow fixtures, optimise irrigation, and consider compliant rainwater/greywater solutions; smaller properties can reduce usage and charges.

– Know your tariff: Understand block thresholds, fixed and sanitation charges, and any senior or indigent rebates. Query anomalies promptly.

– Build a utilities buffer: A dedicated contingency for above-inflation utilities and medical aid increases can protect your lifestyle.

Bottom line

Retirement sustainability isn’t only about market returns. With medical aid and water costs rising well above CPI, proactive planning and usage efficiency are essential to keep pensions viable over the long term.