How to make sure you have enough money to retire
By Cindy Cummings
If you want to retire comfortably at 65 in Nigeria and have no money worries, then you need to have saved around N80 million. This is because the life expectancy for someone in their twenties has gone up to 85. You will need to plan to save enough money to last you for twenty years once you retire. You will also need to take into consideration that you may need an increased amount of medical and health care as you get older. So how do you make sure that you have enough money in the bank to retire and live in financial freedom?
Flexible working after 65
The official retirement age in Nigeria is 65 – this is when we must stop work and receive a pension. However, this ge has been raised to 70for a number of different professions, including teaching, and some medical staff. Continuing to work for these five years can help to boost your pension pot. If you are working in the private sector in Nigeria, fortunately there is no enforceable retirement age. Following apart-time or flexible working pattern over the age of 65 can help to boost your state pension and give you the funds that you need to be able to live comfortably in your old age.
Equity release scheme
Less than 5% of Nigerians are financially free by the time they reach retirement age. Many still have mortgage payments to make and debts to pay. Sometimes you will need a cash lump sum in order to pay these off and live without worry. Through an equity release scheme you can take out some of the value in your home, but still live there until you choose to sell it. This can be ideal if you are concerned about the amount of pension that you have to rely on. You can even continue to work flexibly after the age of retirement and put money back into the value of your home at a later date.
Invest savings wisely from your job
The Nigerian government are making a concerted effort to encourage low income families and those without bank accounts to save money for the future. The SANEF (Shared Agent Network Expansion Facility). The scheme that launched in October is designed to allow everybody to save money, no matter what their financial circumstances. If you are continuing to work a part time or flexible job, the SANEF account is ideal for paying in wages quickly and easily.
Putting by a little each week can make an enormous difference to your pension in the long term. Alternatively, there are a variety of conventional savings accounts that can gain you interest of around 3% per annum.
When you are young, retirement may seem a long way off. But if you start planning sooner rather than later, you can make sure that you have enough money to retire without having any financial worries.