One of the features of the new contributory pension scheme is advisory services to prospective retirees on how to plan ahead and imagine life after retirement. The retiree has to factor in his needs for money, housing, good health, retirement work, and lifestyle.
PAL Pension Managing Director, Dave Uduanu, highlighted this much when Pension Funds Administrators (PFAs) took their public enlightenment campaign to Port Harcourt.
Take responsibility
Demola Sogunle, Chief Executive Officer, Stanbic IBTC Pension Managers, a member of Stanbic IBTC Holdings, said the risk of not achieving a financially secure retirement is high among Nigerians, and urged them to take greater responsibility for their financial security in retirement.
Since retirement from active working life is inevitable, he stressed, planning for it should commence early because it takes many years to accumulate funds to live comfortably when monthly salary ceases.
“This seminar, besides celebrating those who will soon become retired clients of Stanbic IBTC Pension Managers, also provides an opportunity to address the concerns or anxieties you might have as retirement draws near,” Sogunle explained.
He said the lack of interest and complaints of administrative complexities are addressed under the Contributory Pension Scheme upgraded through the Pension Reform Act of 2014.
Engage financial adviser
He counselled engaging a professional financial adviser to help design a retirement plan appropriate for each person.
By embracing a retirement plan from the early days of employment, Sogunle said workers will avoid the myriad of difficult decisions encountered when retirement closes in.
Employers too have a major role to play by helping employees work on their retirement outlook by opening a retirement savings account, encouraging savings, and helping to ease workers’ transition to retirement.
The seminar also provided a platform for the PFAs to forge closer ties with clients and to illuminate emerging trends, promote awareness, and help educate the public on the pension industry.
From working life to retirement
Other issues discussed included preparation for retirement, how to access retirement benefits, health at retirement, and investment opportunities for post-retirement.
Emmanuel Olu-Ayeni, Managing Partner of StarBright Consulting, traced the stages in the active working life that culminate in retirement, noting that the planning and resources mustered during working days shape life in retirement.
Chito Nwana, Medical Director of Tabitha Medical Centre, Abuja, implored retirees to strike a balance between expectations and lifestyle in retirement to avoid stress.
She also recommended appropriate diet and regular physical exercises for pensioners.
Tope Adeyemo of Firstlink Consultant explained that the questions to be considered include: How much money do I have for retirement? How much money will I need to pay bills in retirement? Do I want to travel?
What is the cost of living where I plan to live? Will I have my mortgage paid off? How much should I budget for medical expenses or insurance? and What debts can I pay off before retiring?
Answers to these questions are important, as they will help decide how much money is needed for a particular retirement lifestyle.
“By knowing how much money you can count on and how much you expect to spend, you can decide if you can afford to retire.
“In finding out how much money you will need to live the retirement lifestyle you want, most people will need at least 70 per cent of their pre-retirement income to live comfortably in retirement,” he advised.
