There is a need for retirees to embrace annuity products offered by insurance companies as a way of staying happy with a guaranteed steady income in retirement, the Nigerian Insurers Association has said.
The association also asked prospective retirees to receive unbiased and independent practical advice and training on investment issues necessary for prudent management of their lump sum payment.
Retirement experts assembled by the association gave the advice during a one-day workshop organised by the NIA, with the theme, ‘Preparing for tomorrow today’, in Lagos. One of the presenters at the workshop, Olusola Ilori, who spoke on ‘Importance and necessity of building economic back up’, observed that many retirees were ill-equipped to invest their lump sum themselves or even to choose the right financial advisers.
Speaking on what the retirees should do before investing their lump sum, she stated, “Take your time; take a good look at yourself (especially your financial habits and history); get good independent advice from three good financial advisers; have a plan; diversify – don’t put all your eggs in one basket; become knowledgeable and skilled in whatever thing you decide to do; and start a business on a small scale.”
During the workshop, Ilori warned the retirees to avoid scams and get-rich-quick schemes. She stated, “Don’t lend money to people on your lump sum (if lent to your family, consider it a gift). Don’t buy a new car; don’t marry a new wife; don’t start building a magnificent house.”
While explaining the importance and necessity of building economic backups, she stated that there was a need to maintain a balanced lifestyle out of office. The NIA said, “There is the need to attain financial independence. There is the need to strive for economic self-sufficiency through other sources of income to complement pensions paid monthly to retirees.”
“On no account should one be pressurised to retire without planning and having at least two or three other streams of income to complement pensions.” This would give financial security, guaranteeing dignity and comfort in retirement, she stated. Ilori warned, “No doubt, retirement is going to come someday.” Punch
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