Measurement of the performance of Nigerian Pension Funds Administrators (PFAs) reveal strong determination on the part of operators to deliver good returns on investment that will benefit contributors and retirees. Trend shows quality returns, an indication that pensions account holders will have a lot to be happy about at the time of retirement.
For instance, at the end of June 2019, AXA Mansard Pensions Limited has shown consistence in its performance through all four funds as it remains top 4 in all four funds with a year to date return of 6.54 percent in Fund 1, 6.44 percent in Fund 2, 6.97 percent in Fund 3, and 7.39 percent in Fund 4.
Along with AXA Mansard Pensions Limited, other fund administrators performing well include AIICO Pension Fund Management, PAL Pensions, Leadway Pensure PFA Limited, OAK Pensions Limited, Crusader Sterling Pensions Limited and Radix Pension Managers Limited.
Pension funds are collective investment undertakings that manage employee savings and retirement. Their primary objective is to provide pensioners who have reached retirement age with income. Pension Funds Administrators are expected to open Retirement Savings Account (RSA) for employees, invest and manage pension fund assets, pay retirement benefits and account for all transactions relating to the pension funds managed by them.
Creating a pensions scheme earlier in life has proven to be an established means of reducing old-age poverty and reducing the difficulties faced by multi-generational households. Asides the 18% mandatory contributions from you and your employer, you can also voluntarily contribute to increase your greater chances of a fantastic retirement plan.
Voluntary contributions refer to additional contributions (after the mandatory deductions) from your salary to your RSA where your regular pension contribution will not be sufficient to meet your personal retirement goals. The funds will be invested alongside the mandatory contributions in your RSA, thereby ensuring that your money works harder for you. It is nice and relaxing to know that whilst you’re currently working to make money, your money is also doing the same thing- working for you, it gives you certainty and peace of mind and makes retirement even more looking forward to.Voluntary Contributions are deducted from your total emolument before tax is applied.
In addition to boosting your retirement funds, your voluntary contribution can also serve as a form of targeted savings towards specific projects, such as, a dream vacation, children’s school fees, etc.
Voluntary Contributions are flexible such that the amount to be contributed, the periodicity of contributions and withdrawals are determined by the Retirement Savings Account (RSA) Holder.
Voluntary Contributions can be withdrawn at the discretion of the RSA Holder. So, you can withdraw from, or liquidate your voluntary contribution at any time, the power is in your hands. Withdrawal after 5 years of a contribution is tax exempt however; withdrawal within 5 years is subject to tax on income earned.
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