Annuity Plan As A Dependable Retirement Income

By Oyekola Taiwo Zacharia 

email address: consciousofrisks@yahoo.com; phone no: 07063718460

Last week, we began a series on dependable retirement income options for different classes of workers. That piece was titled: The ‘Benefits Of Tax Rebate For The Employee’. Today, we continue the series, submitting that an Annuity Plan comes with a lot of benefits.

Dependable income means something that is consistent, trustworthy, guaranteed, and reliable.

These are what the annuity plan represents, and the date of payment, duties, and responsibilities of each party are clearly stated in the annuity agreement letter.

The policy certificate contains the terms, conditions, and benefits. It is a plan regulated by the National

Insurance Commission (NAICOM), which supervises, regulates, and monitors all activities of insurance

companies in Nigeria.

Annuity is more profitable, requires no medical assessment like other products, and it is flexible.

Annuity As A Dependable Retirement Income

Old age means transitioning from active work to a new phase of life, moving from professional duties to pension income.

Basically, old age is when bones and body organs are no longer as active as it were before.

At this stage of life, one needs a dependable retirement income to carry on and cope with daily living expenses; annuity comes in handy.

Life insurance companies licensed by NAICOM are permitted to underwrite different classes of annuities in Nigeria.

Why Annuity Is Called Dependable Income

Annuity is referred to as dependable income because of the following key benefits:

1. Consistent and steady income

Subscribers receive monthly payouts on regular dates without any disappointment.

READ ALSO: It Is Relief At Last At National Health Insurance Authority..

READ ALSO: Lagos Cautions Citizens Paying ILERA EKO Health Insurance Premium

2. Reliable income

Payments are received on the exact date stated in the annuity agreement letter, enabling retirees to plan their budgets.

3. Predictable income

Monthly payment is assured every month to make retiree financial planning easier.

4. Guaranteed payment

Payments are not affected by any market fluctuations.

5. Peace of mind

Monthly income continues even during the periods of uncertainty.

6. Escalation options

Annual increase options of 5% or 10% are available.

7. Beneficiary protection

If the annuitant passes away after annuity payments have commenced, five (5) times the annual payment is paid to the named beneficiary.

The question may then be asked: at What Age Can a Person Take This Plan?

Annuity is designed for:

• Working-class individuals
• Business owners
• Entrepreneurs
• Retirees

The minimum entry age is 25 years, for the purpose of securing regular income at retirement.

Types of Annuity

Deferred Annuity

Deferred Annuity is a retirement plan that allows individuals to save towards a chosen retirement age such as:

• 50 years
• 55 years
• 60 years
• 65 years
• 70 years

READ ALSO: PenCom Releases Guidelines On Foreign Currency Pension Contributions

READ ALSO: These Pensioners Are Set To Protest Over 96 Months Unpaid Arrears

Immediate Annuity

This kind of policy is available to individuals 50 years and above, funded with a single premium deposit, and payments begin immediately.

How Can I Subscribe to This Plan?

This product is available through licensed life insurance companies in Nigeria.

However, it is very important to seek professional advice from qualified insurance consultants who understand policy terms and conditions.

This is one of the reasons that this column has been established.

If you are interested or have other clarifications, do please send an SMS or whatsapp chat using the above contact details.