Access ARM urges contributors to prepare early for retirement

Access ARM Pensions has urged pension contributors to begin preparing for retirement well before leaving active service, stressing that understanding retirement benefit options and compliance requirements is essential for timely access to benefits and a smooth transition into retirement.

The pension fund administrator gave the advice during a webinar titled: ‘Retire Ready: Programmed Withdrawal, Annuity & You,’ where pension experts explained retirement planning under the Contributory Pension Scheme (CPS), retirement income options and the key steps contributors should take before exiting the workforce.

Speaking during the session, Zainab Bello, head of Benefits Administration, said while many Nigerians contribute to their Retirement Savings Accounts (RSAs) for decades, few fully understand how their retirement benefits are calculated and paid. “People spend over 30 years planning for retirement but often spend only a few days trying to understand how their retirement benefits actually work,” Bello said.

She described the choice between Programmed Withdrawal and Retiree Life Annuity as one of the most important decisions retirees make, noting that each option offers distinct benefits depending on an individual’s financial objectives and family circumstances.

According to Bello, retirement under the CPS begins with the selection of a retirement income option before the retiree receives a lump sum, where applicable, and periodic pension payments.

She explained that retirement benefits comprise not only pension contributions but also investment income accumulated over the years, accrued rights where applicable, pension enhancements and any additional remittances. Bello also clarified that the National Pension Commission (PenCom) does not prescribe a fixed percentage for lump-sum withdrawals. Instead, the amount payable is determined by whether sufficient funds remain in the RSA to provide the minimum pension required under the regulations.

Explaining the differences between the two retirement income options, she said retirees who choose Programmed Withdrawal continue to earn investment returns because their pension assets remain invested and managed by their PFA, allowing pensions to be enhanced periodically as returns improve. By contrast, retirees who opt for an annuity receive guaranteed lifetime pension payments from a licensed insurance company, with payments determined by prevailing interest rates and actuarial assumptions. “Both Programmed Withdrawal and Annuity are valuable retirement benefit options, each designed to meet different financial needs and retirement goals. The most suitable choice depends on an individual’s personal circumstances, financial priorities and long-term retirement objectives. We encourage retirees to fully understand both options and seek professional guidance before making a decision,” she said.

Also speaking, Ayodeji Ayo-Majaro, head of Compliance, said compliance should be viewed as a critical safeguard for retirement security rather than merely a regulatory requirement. “Compliance is not just about obeying rules. It is about protecting your retirement benefits, your dignity and your financial future,” he said. Ayo-Majaro identified poor employment records, multiple Retirement Savings Accounts, inconsistent personal information and incomplete documentation as some of the leading causes of delays in processing retirement benefits. He advised contributors to regularly verify their employment records, National Identity Number (NIN), RSA details, beneficiary and next-of-kin information to ensure all records are accurate and up to date. “Many retirement disputes originate from poor employment record documentation. Check yours today,” he said. He also urged contributors to monitor their pension remittances regularly to ensure employers make complete and timely contributions, warning that missing remittances or unreconciled records could significantly reduce retirement benefits or delay payment. The webinar also featured presentations by insurance professionals on Retiree Life Annuities and by estate planning experts on the role of trusts and wills in wealth transfer, providing participants with a comprehensive guide to making informed retirement decisions. The event concluded with an interactive question-and-answer session, during which participants sought clarification on benefit calculations, retirement income options, documentation requirements, beneficiary arrangements and estate planning.