PENCOM assets hit N4.6 trillion-Aminu Iman

The National Pension Commission (PenCom), said it has generated over N4.6 trillion in the Contributory Pension Scheme (CPS), since incep¬tion in 2004.

Speaking at the opening cer¬emony of a two-day workshop on the 2014 Pension Reform Act (PRA) with the theme: “New Pension Act 2014, its Implications and Obligations to both Employers and Employees in Nigeria” organised in collaboration with Lagos Council of Nigeria Labour Congress (NLC), the Direc¬tor-General of PenCom, Mrs. Chinelo Anohu-Amazu, said the coverage of the CPS included employees in the public service of the federal, states and local governments as well as the private sector organisa-tions with three or more employees.

Represented by Mr. Mohammed Bello Umar, the Com¬mission’s Head of Compliance and Enforcement Department, she recalled that the pension reform started in 2004 with the passage of PRA 2004, which provided for a uniform pension system for both public and private sectors.

According to her, “the CPS has been successfully imple¬mented since then and the fund under management has grown to about N4.6 trillion while membership is over six million.

She explained that the coverage of the CPS include employees in the public service of the federal, states and local governments as well as the private sector organisations with three or more employees.

The PRA 2014, she added, strengthened the powers of the commission to perform its mandate of regulation and supervision of all pension matters, stating that it would fur¬ther protect and create value for the contributor.

She said, “following the successful passage of the PRA 2014, PenCom is working towards significantly increasing the membership of CPS by expanding the coverage to include the informal sector as well as ensuring that the pen¬sion assets are invested in ways that are most beneficial to the economy.”

(NAN) in peoples daily

5 Questions to Test Your Retirement IQ-Erika Rawes

 

Source: Thinkstock

For so many Americans, retirement planning is a complete mystery. For some people, they’d have an easier time deciding who shot first (Han Solo or Greedo?) than making decisions about their retirement savings. When CBS News asked consumers a while back how much they’d need to save for retirement, the median answer among Americans was $300,000.

Sure, everyone is different. We all need different amounts of money to live, survive, and thrive. But, regardless, $300,000 is way off the mark. Unless you’re planning to work until you’re 80 years old, which 30% of people in a Wells Fargo survey said they intended to do, you will run out of money before the end of your lifespan.
Helga Cuthbert is a certified financial planner and the principal of Cuthbert Financial Guidance in Decatur, Georgia. We spoke to her about retirement planning to gain some additional insight on the subject. She says this 30% group is taking a big risk, as this plan assumes there will be a job available and that they will physically be able to work at the age of 70, 75, or 80.
Just because dynamos like Alex Trebek and Morgan Freeman can pull it off, this doesn’t mean the rest of us can. So, this means we should have a plan. So, why isn’t everyone saving for retirement?
With all the monthly bills, combined with the unplanned expenses people have, extra money is often in short supply, and retirement may be something people plan to simply worry about later. Young people, in particular, place retirement on the back burner — probably because it seems so far down the road. “The earlier [people] start, they place themselves in a better position … and don’t have to save as much later… They don’t have to play catch up in their 30s and 40s,” says Cuthbert.
How would you rate your retirement knowledge? Find out by answering these questions.

1. At what age should you start saving for retirement?

What do you think? Does 25 sound about right? Maybe 30?
Well, the real answer to that question is: as early as possible. Cuthbert suggests you start saving “as soon as you have earned income [from a career].” Say, for instance, you begin placing $5,000 per year into a traditional IRA at age 25. By age 65, your IRA will be worth nearly $1.1 million before taxes — a pretty large chunk of change (over 500% of your contributed amount).
On the other hand, if you wait until age 40 to contribute the same amount, you end up with an IRA worth around $340,000 (before taxes) — around 275% of your total contributed amount.
“Young people seem to understand financial independence, but for many, retirement is an alien concept. … Starting early allows time for interest to compound,” says Cuthbert.

 

Source: Thinkstock

2. How much should you contribute to an employer-matched 401k?

You should contribute at least as much as your employer will match. The matched portion is basically free money. “Some employees don’t understand the concept of match significance. … When an employer matches your contributions, it’s like getting a 100 percent return on your match,” says Cuthbert. “Employers [these days, however,] are doing a fairly good job of explaining this to employees,” she adds.

3. What risks do you face with a 401k?

As a portfolio, your 401k carries market risk and market volatility can impact your investments. Remember the recession? Millions of retirement plans were negatively impacted by the down economy. You also face company risk – values of stocks and bond fluctuate as a company performs well, launches a new product or service, or goes through changes in public image. Factors, such as inflation, currency, and interest rates may also impact your 401k.

4. If you are in a low tax bracket, are you better off with a traditional or a Roth IRA?

Those in a lower tax bracket are often good candidates for a Roth IRA. With a Roth IRA, you’re having contributions come out of money you already paid taxes on so you do not have to pay taxes on the accumulated earnings in the future. You are therefore assuming you will be in a higher tax bracket at retirement than you are today.

 

Source: Thinkstock

5. What is a myRA?

A myRA was new for 2014, and it’s set-up in a similar manner to a Roth IRA in that your contributions are made with after-tax earnings. The primary benefit of a myRA is that it is risk-free. Your contributions go into treasury securities that are government backed. You also can set up a myRA with a small amount of funds and your principal investment on this type of IRA is considered to be safe. On the other hand, you are unlikely to earn any substantial return on your investment.

So, how much of this information did you know?

• 4-5 questions correct: If you knew four or five of the answers to the questions, you have a pretty high retirement IQ. You pay attention enough to know your stuff, and you’ve certainly got the basics down pat. You’re in good shape to start or continue (hopefully continue) planning for retirement. Even though you may be a retirement whiz, you may still benefit from speaking to a financial adviser about retirement.

2-3 questions correct: If you knew the correct answers to two or three of the questions, you’re retirement IQ is about average. You’ve picked up knowledge here and there, but you may still be a little fuzzy in some areas. It would be prudent to meet with a financial professional to discuss your financial future.

Less than 2 questions correct: If you answered less than two of these questions correctly, you’re retirement IQ is poor. Perhaps retirement talk is boring to you, or maybe you just see it as “so far down the road” that you’ll worry about it later. In any case, it’s a good idea to brush up on the basics and discuss your goals with a financial professional.

Culled Wall St. Cheat Sheet:

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People the driver of businesses - Odunze Reginald C

Speaking before American Bankers Association in San Francisco, Robert Schuller asked them the following questions”1) what are we in this business for anyway? 2) If we keeping going at it the way we are, will we get what we are going after? 3) If we succeed in reaching our goals, will be satisfied- and proud of how we did it? Then he ended it by saying, “Remember that at the bottom line of your business of banking, there are no numbers, only people.”

In management we talk about the 4M’s of management, namely the man, money, material and machines. Man has been the driving force that moves these other M’s to a profitable venture. Disciplines are interwoven, Marketing is eclectic i.e. it borrows from the various fields of learning just as any other discipline.

And in Marketing, people have been an important element in the expanded 4ps of marketing which gave rise to 8 Ps of marketing. People is an important p in the 8 ps of marketing because it drives the remaining 7ps of marketing to achieve maximum profitability i.e. cost reduction and profit maximization which is the basic philosophy of any organization.

In pension administration just like  any other business, it is the people that drives these organizations to the level at which it is expected. In looking at people as it relates to pension marketing and administration, it is imperative we look at the most important person in an organization the leadership.

Leadership

Leadership is of paramount importance in pension marketing and administration, the chief executive is the chief marketer and also the chief image maker of the organization.  Image is everything. He is the eye with which the public sees the organization. Warren Bennis in his book” on becoming a leader “noted that there is clear cut distinction between manager and leader.  He pointed out 4 clear distinctions and they are:

“The manager imitates, the leader originates,

  The manager focus on system and structures, the leader focuses on people

The manager relies on control, the leader inspires trust

The manager maintains, the leader develops”

Bennis concluded that “effective management and leadership mean that the theories and ideas should work well with the employees with a strong direction resulting in effective implementation.”

In my own observation, there are traits of good leadership. A good leader should have these 5ps of leadership and they are as follows:

Principle

Passion

Product Knowledge

Purpose

Perseverance.

In conclusion, it should be noted that the most important of all these 5ps is passion; the Webster’s dictionary defines passion “as an emotional response”

In selling people and businesses are won in the heart of the customer. This is because passion produces a positive response and it is in fact infectious. All dies without passion.

Concluding it should be noted that people is the driving force of any business and the play maker for the transformation of businesses around the globe.

The gains of pension Reform Acts 2004 and 2014 -Odunze Reginald C

   

“Those who love money will never enough” Ecclesiastics (5 VS 10) and Kiyosaki   (1990:70) noted that the world of money is filled with crooks, con-men and charlatans”

Before mismanagement of public fund especially pension fund has been the characteristics and bane of most African countries and Nigeria in particular. The National Provident Fund Act of 1973 and the NSITF Act of 1003 all failed because of mismanagement.  And the inert desire to get rich quick has led to emergence of financial crime which includes mismanagement of pension fund.

And therefore the need to protect these fund against such.  In an article captioned “ PenCom  Assures security of Retirement Saving” Dina ( 2011:36 ) noted that “since the pensioners will utilize the fund at the end of their working life, it becomes imperative that adequate measures be taken for its protection”

The provisions of 2004 PRA  and the Amended 2014 Pension Reform Act which through its regulatory body PenCom has in built checks and balances  to safeguard these funds. This is step in the right direction.

The regulator noted that in order to keep track of the activities, the PFAs and the PFCs  are required to make a regular report of their activities to PenCom. They are also required to maintain a statutory reserve of 12.5 percent of their net profit after tax with the regulatory body.

These checks and balances are meant to give the contributors and the retiree’s rest of mind and ensures the availability of these fund to the retirees at the point of retirement.

 

Culled from reginald odunze.blogspot.com

The need for Additional Voluntary Contribution -Odunze Reginald C

Donna Rosato in an article captioned “5 secrets to a happy retirement” observed that “No doubt about it: More money makes you happier. Once you amass a comfortable nest egg, though, the effect weakens, says financial planner Wes Moss. For his recent book, You Can Retire Sooner Than You Think: The 5 Money Secrets of the Happiest Retirees, Moss surveyed 1,400 retirees in 46 states. The happiest ones had the highest net worths, but Moss found that money’s power to boost your mood diminished after $550,000”

The idea of voluntary contribution will increase the pension pot and stems from the inability of the pension pot to take care of the pension’s expectations, expenditures, medical expenses and other issues arising from the pension contributions.

Most retirees often discover that their pension Pot is not enough to carry them through  and that bring us to the idea of voluntary contribution. Most retirees develop one problem or the other when they discovered that their pension pot is not enough to carry out coupled with the rising cost of living and the sudden realization that the money they saved will not be able to cater for their old age.

Old age is what people pray for  right from their upward age of 15 years and I wonder why people feel terrible uncomfortable on advancing old age. The result has been that bleak rather than happiness.

And according to Richard Evans in an article in the Telegraph Newspaper he noted that “more than a million people have started a self-invested personal pension or Sip since their introduction in 1989, although many run their Sipp with help from a financial adviser.
These plans offer a simple and tax-efficient means to save in a wide variety of investments, from shares and bonds to cash and even, for more sophisticated investors, assets such as commercial property.”

The pension Reform Act 2004 and the pension Reform Act 2014 was explicit on that and it states in section 9 subsection 5 , Any employee to which the act applies may in addition to the total contribution being made by him and his employer make voluntary contribution to his retirement savings account.

The need for voluntary contribution came as a result of the insufficiency of pension contribution and the inability of some private sectors to pay accrued pension rights. The need for accrued pension stems out of the desire of the Federal Government to cater for the period preceding 2004, where an employee have put in number of years to the organization. But a situation where the organization  refused to provide for such accrued right , what do the retiree do,  of course nothing , but if there is additional voluntary contribution , it can take of any shortfall in the expectation   of the retirees pension pot.

Retirees should make it as a duty to check their pension from their Pension Fund Administrators or they make use online pension calculator which has in built mechanism capable of calculating the contributor’s likely expected values and returns based on a projected interest rate and value.

In voluntary contribution, the amount is irrelevant, it is better to start small, so that you don’t feel unsafe especially when your salary is meager, and couldn’t carry you through.

Culled from reginaldodunze.blogspot.com

Revisiting Nigeria military pensioners’ woes-By Joy Baba Yesufu

15th of January every year is usually set aside by the Nigerian Government and Authorities of the armed forces to remember our fallen heroes.

These fallen heroes are said to be military officers who laid down their lives for the unity of our beloved country. They fought to thick and thin to ensure that Nigeria remain one undivided country no matter what anybody or group of people think or believe.

A lot laid down their lives to achieve this purpose, others survive but are permanently maimed from Gun shots injury while another set are alive and retired from active service.

In the entire categories above, one thing is common in their fight “Nigeria Unity”. They are being remembered today for these ultimate sacrifice especially those who lost their lives.

Shortly before this year’s armed forces remembrance day, President Goodluck Jonathan in Abuja commissioned a military cenotaph in memory of the nation’s fallen heroes from 2011 till date.

The cenotaph has names of officers and men who paid the supreme price in the course of various operations especially the current war against insurgency in the north east.

In his address at the occasion, Jonathan said this great monument is a clear testimony that government would always remember those who served this country, especially the military and the paramilitary officers that have to be awake for others to sleep.

“People may not know exactly what you are passing through, they have different opinions but I believe that you are doing the best under the circumstances that you are working.

“Government will continue to encourage you, by providing what is required”, the president assured.

One feature of the Armed Forces remembrance day, year in year out is the different complaints and protests by the military pensioners on how their welfare is never taken into consideration despite assurances by Federal Government and the military authorities to carter for them.

Few days before this year’s celebration, some retired personnel of the Nigerian Military under the umbrella of the Ex- Service Men Welfare Association threatened to embark on a peaceful protest on the day set aside for the Armed Forces Remembrance Day Celebration over non-payment of their pension arrears by the government.

The leadership of the Association said in a statement said that the peaceful protest was intended to call the attention of the government and the public to the plight of the military pensioners.

The statement signed by Col. PA Zubair, Col. HI Ikoghode, MWOs U Samuel and A Agbas, added that the military pensioners had been made to go through harrowing hardship because of the failure of the government to fulfil promises made to them in relation with the issue of the prompt payment of their pension allowances.

The ex-service men argued that it was wrong on the part of the government to celebrate the fallen heroes while their counterparts who are alive are left to starve.

“The members of the Ex-Service Men Welfare Association hereby wish to request for your kind support to bring to the notice of the general public of the plight of the Armed Forces pensioners.

“The military pensioners have continued to face untold hardship as a result of government refusal to pay our outstanding pension arrears since July 2010 to date.

“However, we have been subjected to all forms of deceit from the government and its various organs responsible for the payment of the pension arrears in the annual budget that has not seen the light of the day…

“It is the height of hypocrisy to vote huge sums of money for the fallen heroes every year while the living ones are forgotten and dying of hunger.

“The living heroes are ready to stage a nationwide protest to show the world our plight. No going back on our 53.37% pension arrears based on the correct data.

“We have legally earned the money and refusing to pay us or tampering with it is totally unacceptable,” the statement read.

The Ex-servicemen had threatened to disrupt the Armed Forces Remembrance Day Celebrations scheduled for Thursday, over 30 months of unpaid pension arrears from the 2010 pension increment on December 10, 2014.

The ex-servicemen are angry that the Ministry of Finance opted, without consultations, to implement 33 per cent increment for them while civilians and their counterparts had received the allowances.

They added that ‘even the so called 53.37 per cent that was illegally being reduced to 33 percent was based on wrong data,’ which could be corrected with the implementation of the 2007 pension review among others.

Why are the bodies responsible for pensioners playing with fire at this critical period of this nation? Why do we have to face pensioners protest every year and with same complain?

If their complains are not true, why haven’t the military authority or the Federal Government come out to deny or defend these allegations?

A military source who spoke on condition of anonymity said salaries of the armed forces are usually reviewed after every five years. He said as the salaries of that of the serving men are reviewed and effected it is expected that salaries of the retired men are also reviewed and effected.

The source said every review and increment is always effected on the salaries of serving military officers. How come the 2010 review has been effected on serving officers and that of retired officers, especially those who fought during the war are not effected?

In 2010, President Goodluck Jonathan approved a new salary scale and review of 53 per cent for the armed forces. Soon, it will be another five years and a new salary structures will be approved again. Is this government going to wait to accumulate this 53 per cent then add the next new increment?

Federal Government and military authority are truly joking with these retired men who are trained in the usage of arms. This poses great danger to the nation

There are also serious fears that these pensioners may attack the pension board since some of them assume that their monies are being held by the board.

Is the Federal Government and military authority going to wait until these men (pensioners) take up arms against them before they respond to their needs? These are questions seriously begging for answers.

Culled from peoples daily

The impact of customer’s satisfaction in the Pension Industry-Odunze Reginald C

Image credited to ftadvisers

Napoleon Hill devoted over twenty five years of his life to trying to discover why so few men succeed and so many fail. Le Boeuf (1987:133). He went on to say that he interviewed and studied the lives of numerous great achievers from all walks of life such as Andrew Carnegie, Thomas Edison and Woodrow Wilson and presented the essence of his findings in his classic bestselling “Think and grow Rich”

One of Hill’s best recommendation is to cultivate the idea and habit of rendering more and better service than that for which you are paid” and before you realized it the world is willingly paying you for more than you do” today we call that building perceived value, seventy years ago Napoleon Hill called it “the law of increasing returns” Le Boeuf (op cited)

Pension Fund Administrators are all offering the same service, a homogenous service and the service is basically the following:

Retirement Savings Account

Investment of the contributor’s and retiree’s fund

Customers support services and relationship management

Retirement seminars, pension forums and enlightenment programmes.

Therefore the extra mile the PFAs goes in satisfying the customers will go a long way in enhancing customer’s loyalty. Customer loyalty is essential for the pension fund administrator because it gives the edge they need in the event of the regulatory body National Pension Commission, PenCom, lifting the transfer window.

National Pension Commission ,PenCom has stated that the pension fund is now far in excess of 4.5 Trillion Naira that is good for investment in other sectors of the economy, but analyst are of the view that with the rate of corruption investing such fund may the debar the pensioners from the accessing their fund at the point of retirement.

The desire of the PFAs will be to retain their customers and possibly acquire new ones in the event of the transfer window. But achieving such feat rest squarely on their ability to offer and render more and better services to their customers. Customers are now more sophisticated and their expectations are becoming more and more increasing. They can network and definitely affect the workings of PFAs if not giving their expectations.

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