The Contributory Pension Scheme (CPS) stands as a cornerstone in Nigeria’s efforts to secure retirement benefits for its citizens. The primary goal of the Pension Reform Act 2014 (PRA 2014) is to ensure individuals save adequately for their post-employment years. Central to this scheme is the provision for lump sum withdrawals upon retirement, aimed at providing retirees with financial stability while receiving periodic pensions.
Section 7 of the PRA 2014 outlines the options available to a Retirement Savings Account (RSA) holder upon retirement or attaining 50 years of age. The first option is withdrawal of a lump sum from the total amount credited to his RSA provided that the amount left after the lump sum withdrawal shall be sufficient to procure programmed fund withdrawals or annuity for life in accordance with extant guidelines issued by the Commission, from time to time. The retiree also has the option of programmed monthly or quarterly withdrawals or a Retiree Life Annuity (RLA) purchased from a life insurance company with monthly or quarterly payments.
