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  • Writer's pictureDamilola Agubata

Understanding Your Retirement Benefits: A Proper Breakdown

It is your right to know the complete details of your retirement benefits. And as the Pension Fund Administrator (PFA) of your choice, it is our duty to keep you informed on the various categories of benefits that you are entitled to as a Retirement Savings Account (RSA) contributor.

We will give you a proper breakdown of the benefits that you are eligible to receive when you attain the statutory retirement age of 60 or after working for not less than a period of 35 years.

If you are glued to this page, be prepared to get all the information you need.

Before we dive into the proper breakdown, let’s look at why retirement benefits are necessary for all workers and employees in Nigeria.

Why are retirement benefits necessary?

Just like in other countries, including Nigeria, retirees deserve to be placed on a stable income as a reward for their years of service to public or private organizations. Here are a few reasons why retirement benefits are necessary:

They provide income security

As we all grow older, it is necessary that we do not exert as much effort or strength as we used to in our younger years. And the result of this is the inability to effectively carry out tasks that may generate high profits. But because age should not be a barrier to comfortable living, retirement benefits enable us to get paid steadily even while we are old and fragile.

Employers are able to compensate their employees duly

Another reason retirement benefits are necessary is that it creates room for employers to adequately reward their employees for committing and sacrificing daily in the course of executing their individual duties and tasks.

When it is made clear that retirement benefits form a part of the total compensation for employees, it encourages and motivates them to join the country’s active workforce and contribute value to the overall development of the nation at large.

A graphic image of two middle-aged retirees (male and female who are likely a couple) along with the words, 'understanding your retirement benefits: a proper breakdown'. Credit: Oak Pensions Limited
Understanding your Retirement Benefits: A Proper Breakdown. Credit: Oak Pensions Limited

They give room for economic growth

It goes without saying that retirement benefits play a part in advancing the nation’s economy. When we all actively save for retirement under the Contributory Pension Scheme (CPS), the funds saved and invested can be directed to other sectors of the economy as a way of promoting overall growth and development.

In addition, when retirees receive pension payments, they can help to boost the economy through their spending and contributions to local businesses.

When can you access your retirement benefits?

According to the National Pension Commission (PenCom), the legal age to access your retirement benefits is 50.

However, there are conditions that make it possible for you to access them before 50. We explained them in this post: How to Withdraw Money From Your Pension Account Before the Age of 50.

Now, let’s break down what your retirement benefits are and how your PFA administers them:

What are your retirement benefits?

Programmed Withdrawal

You are entitled to programmed withdrawal as long as this is what you opt for. When you retire and opt for programmed withdrawal, your details will be inputted into the computation template provided by PenCom to generate your monthly pension and lumpsum (if you opt for a lump sum).

What are these details?

The details inputted into the template are:

  • Gender;

  • RSA balance;

  • Final salary; and

  • Age at retirement.


An annuity is another benefit option you can opt for. When you choose the annuity option without a lump sum, you’ll need to provide your annuity agreement and your RSA balance will be transferred to your preferred insurance company.

Alternatively, you can choose to receive a lump sum payment. We’ll input your details into the template provided by PenCom to determine your lumpsum payment and the balance after deducting the lump sum and arrears will be transferred to your preferred insurance company after you've provided an annuity agreement.

En Bloc Payment

You are entitled to en bloc payment if your RSA balance by the time you retire is N550,000 and below. This means that you will receive the payment as a whole.

25% on account of job loss

When you are yet to get a new job after four months of losing your job, you are entitled to access 25% of your RSA balance and the remaining balance when you get a new job or attain the age of 50.

Retirement on Health Grounds

You can receive this benefit even before you turn 50 when it has been certified by a qualified medical board that you are no longer physically fit to work.

Death Benefit

This benefit is processed by the beneficiaries or Next of Kin of a deceased RSA holder and it is in two categories:

  • Death benefit for RSA holders;

  • Death benefit for employees that fell under the scheme but did not open RSAs before their death. In this case, the beneficiaries will have to open a Death Benefit Account (DBA) where the contributions of the deceased will be paid and the death benefit administered.

If you would like to register with Oak Pensions, call the Marketing Manager at 09087448661 or send an email to


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