*RETIREMENT – How Prepared are you?*
In my capacity as an actuarial officer, I have had diverse
encounters with people especially the elderly asking the
question; How much will SSNIT pay me when I retire?
Normally, these individuals have some years, months or even
few weeks to retire.
Upon looking at their contributions and making some
estimations as to the amount they are likely to receive, their
faces become dazed with expressions of disappointment.
How come my pension is so small? They exclaim! . From
further conversations, I find out that most of these people do
not have any other form of retirement plans.
I am writing this to provoke you, both young and old to take
deep thoughts and practical actions towards having a happy
stress free retirement.
The Holy book states and I quote “There is a time for
everything, and a season for every activity under the
heavens: a time to be born and a time to die” Ecclesiastes
3:1-2. And there’s a time to work and a time to retire.
Retirement in lay man’s terms means voluntarily or
compulsorily disengaging from active work permanently.
There are several potential sources of income or support
during retirement. These sources include:
1. Support from family and friends
2. Support from children
3. Employment after retirement
4. Personal Investment
5. Social support such as pension and Health Insurance.
Let us take a look at each of these sources.
1. *Support from family and friends*: Our society is becoming
westernized by the day. Our extended family culture is soon
becoming a thing of the past. Some decades back, family
members come together to support the aged within the
family. This support ranges from money, clothes, shelter and
even meals. But now, in the 21st century, everyone is
thinking about their immediate families.
It is therefore obvious that you cannot depend on this system
of support in your retirement. Infact, don’t even think about
it, because it is suicidal.
2. *Support from children*: Have you ever heard this, ‘I am
taking good care of my children today so that they can also
take care of me when I retire’? Well, there is an aorta of truth
in that statement. But in this fast paced world that we live in,
with the exigencies of attaining high educational status
before getting a good job coupled with high unemployment
rates; how sure are you that you will still not be paying
school fees even in your retirement? Once they complete
school, they begin to have their own financial burdens. The
burden of getting a good job, marrying, raising kids of their
own, just to mention a few.
I believe your statement can be reframed as, ‘I am taking
good care of my children today so they don’t have to depend
on me when I retire’.
Don’t get me wrong, it is honourable to honour parents and it
is God’s only commandment with a promise. But the same
Bible says a good person leaves inheritance for his childrens’
children. My humble submission is don’t place too much
hope on your children because life has got its own twists and
3. *Employment after retirement*: really? Are you kidding me?
Even the young professionals are struggling to get a job!.
Unless you intend to run your own business or you are a
highly trained skilled professional, your chances of landing a
job after retirement is almost zero. You face a lot of stress,
anxiety and fatigue just because you must keep up with the
young. But this does not mean you can’t do anything
meaningful and rewarding. Ever head of Colonel Sanders? He
founded the famous KFC during his retirement years.
4. *Personal Investment*: People who think about retirement
early in their careers make conscious effort to invest towards
their retirement. These types of investments ranges from
money market, provident funds, equities, stocks and investing
in appreciating properties such us land and buildings.
Evidence show that those who are disciplined enough to put
some money away on regular basis and invest in appreciating
properties are likely to have a stress free retirement.
5. *Social security support* such as SSNIT pensions and the
other tier pensions systems are designed to give you income
support upon retirement. It can only replace a portion of
what you were earning while in active employment.
Depending on your gross salary and the length of time you
have contributed, your benefits can either be high or low. But
no matter how pretty your benefit is, it will always be lower
than what you were earning prior to retirement. That is the
stark truth. No Pension Fund will give you fuel coupon,
vehicle maintenance allowance, clothing allowance and…….
hehe, entertainment allowance. Did I say that? yes!!!
Before you go consider these tips,
a. Do not make social security pension and the 2nd tier
benefit as your only source of income. My manager usually
says, if 94.5% of your salary could not help you prepare for
retirement, how much more 5.5%.?
b. Consider investing some money on regular basis
specifically towards retirement.
c. Take good care of your health, eat well and exercise more.
You will realise the dividend when you retire.
d. Engage yourself in seminars on retirement. You will
definitely learn more.
e. Make adjustments to your lifestyle so you can save more.
f. Plan, Plan, Plan!!!
Retirement can be a nightmare if you don’t plan well but it
can also be a happy stress free thing if you plan well.
So before you buy that luxurious car, before you go on that
expensive vacation, before you buy that expensive phone;
think of your retirement. We all deserve a happy retirement.
“In the morning sow thy seed, and in the evening withhold
not thine hand: for thou knowest not whether shall prosper,
either this or that, or whether they both shall be alike good.”
May the good Lord guide us in wisdom and prudence even as
we work towards having a happy stress free fulfilled life.