retirement plan
Retirement Plan is the arrangement you build now, savings, pension, investments, so that when work stops, money does not stop with it.
In plain English
Aunty Kemi sold wrappers at Balogun market for twenty six years, and every single day she put aside a little something into a cooperative box before locking up her stall.
She never called it a retirement plan. She called it 'my old age money.' But that is exactly what it was, a calm, deliberate decision to feed her future self even while feeding her family today.
A retirement plan is simply that decision made formal and structured. It is the answer to one honest question: when you can no longer work for money, how will money still work for you?
For a salary earner in Lagos, it might mean the Pension Plan deductions on their payslip plus a personal investment account on the side. For someone in Leeds sending money home to parents, it might mean also setting up their own workplace pension so they are not depending on their children the way their parents now depend on them.
The plan is not one single account. It is the whole consider, your pension contributions, any property, any shares, any business that can still pay you when you are seventy and tired of hustling.
Nobody plans to be broke at sixty five. People just forget to plan not to be. That is the whole difference a retirement plan makes.
If Tunde saves ₦50,000 monthly from age 30 into a pension account earning 10% yearly, by age 60 he could have well over ₦100,000,000 sitting there, simply because he started early and let time do the heavy lifting.
Questions people ask
Is a retirement plan the same thing as a pension?
Not quite. A pension is usually one part of the plan, often the compulsory or employer linked part. The full retirement plan includes the pension plus any other savings, property or investments you are counting on.
When should someone start a retirement plan?
As early as your first salary or first steady income, honestly. Even ₦10,000 monthly in your twenties can grow into far more than a much bigger amount started in your forties, because of how long it has to grow.
What if I am self employed or a trader with no employer pension?
You are not left out. You can open a personal pension account or a separate investment account and treat your own contributions the same way an employer would, moving money in every single month without fail.
Last reviewed