CPS: What the future holds for those who plan for it?

Olasupo Mrs. retired three years ago from a mid-size financial services company in Lagos and currently lives on her monthly pensions. She is happy and has become an advocate of saving for retirement. Her story is quite exciting, not only because she receives her pension as early as 22nd of every month, but that she is certain, she won’t need to depend on her children or on anybody until she passes on. The lesson to learn from her is that she planned for the retirement. While her employer keyed into the Contributory Pension Scheme (CPS) early enough, saving along with her, she made additional contribution and today she is happier for it.

If you have been part of the CPS, make sure you are working hard to improve on your savings because this is the best thing to have happened to Nigerians at this time. An interesting side of the scheme is its potential to reduce substantially the tradition of parents depending wholly on their children for daily up-keeps at old age. It is coming handy again, at a time when generational change influenced by growing cosmopolitan culture is taking children away from home to care of their aged parents.

With the CPS therefore, Nigerians both in the formal and informal sectors have the opportunity to save for old age, not only to take the care-burden off their children, but also to enjoy independence and dignity of life in retirement.

For those who are not covered on the present scheme, make up your mind into keying into the micro pension scheme which is expected the coming 2017. This will ensure you have planned programme that is secured and guaranteed for successful retirement.

The objective of the CPS is to ensure that every person who worked in either the Public Service of the Federation, Federal Capital Territory or Private Sector receives his retirement benefits as and when due. While for the informal sector or standing alone entrepreneurs, an arrangement is being made by the industry regulator, the National Pension Commission (PenCom) to accommodate them.

If you have understood the operations of the CPS, then key into it or face a future that will be largely influenced by socio-cultural changes.

A new demographic structure is emerging in the society, with declining family dependence among many homes, making it indispensible the need for everyone to provide for his future.

Common with Africa, relatives and families have been interdependent of one another for assistance and support, which created little or no need for long term savings culture, as a form of protection.

But with many families now going towards nuclear setting, and members of different families concentrating on taking care of their immediate relations, the extended structure that had held sway for many centuries back is losing strength.

There is therefore a growing cosmopolitan culture, where people have embraced western philosophy and modern life style, so large dependence on families for support has begun to wind down, so there is hunger more than ever for alternative sources of support.

Expert informed that the new generation of children have taking to live in the Cities and overseas and as they embrace western life style they would gradually think less of the extended partner of living.

“It is common to find these days’ family sizes pruning down to 3 and four, unlike what existed in the past and this suggest that people want to keep smaller homes, so, the tendency that they will have that luxury to begin to look after aged parents in the future is in the decline”.

The implication of this the expert say is that people would now begin to think of how to provide for their future and retirement rather than want to depend on their children who may have chosen to live the city way of life.

To the expert, it requires that people begin to get educated on how to provide for retirement through a committed system of pension contribution and the likes, such that dependence on children and relatives for such support would be less if it must be.

If you do not therefore need to depend completely on your children or relations to feed, get your medication or be a kind of burden to anybody because of lack, you will be more respected, says a pension expert.

According to the expert, you don’t need to go and stay in a relations house for five days to get financial assistance, to feed or to buy your medication if you can be part of the contributory pension scheme today.

The CPS was introduced to replace the old pension scheme, where employees had to rely entirely on the employer for monthly pension payouts after retirement. The Act has recently successfully undergone an amendment in the National Assembly to take care of grey areas and have the objectives to: ensure that every person who worked in either the Public Service of the Federation, Federal Capital Territory or Private Sector receives his retirement benefits as and when due; (b) assist improvident individuals by ensuring that they save in order to cater for their livelihood during old age; and (c) establish a uniform set of rules, regulations and standards for the administration and payments of retirement benefits for the Public Service of the Federation, Federal Capital Territory and the Private Sector”.