How to achieve dreamed retirement with deferred annuity

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Chuks Udo Okonta

The crave for huge fund to begin a new life in retirement is soaring everyday, as many retirees are kicking against pension lump sum and monthly pension benefits, in demand for en bloc payment.

For these retirees, getting en bloc, would avail them huge funds to invest in businesses that would yield better return than what they get as monthly pension benefits.

The decision by the government to provide retirees who have enough fund in their Retirement Savings Account (RSA) with lump sum and monthly pension benefits, is to prevent old age poverty, but the poor economic conditions and the soaring inflation have almost rendered what comes as monthly pension benefits useless as most retirees can barely survive with their monthly pension benefits.

To have huge fund at retirement, deferred annuity seem to be the solution, as contributors have the option to collect their total contributions or take lump sum and programmed the balance fund into monthly annuity payment.

Deferred annuity – an insurance product, is a personal retirement investment plan that could be adopted by workers in formal and informal sectors.

For those in the formal sector, it could compliment the Contributory Pension Scheme (CPS) contributions, while those in the informal sector could also run it along side the Micro Pension Plan (MPP) which is operated by Pension Fund Administrators PFAs) within the pension sector.

Deferred annuity has unique features, which makes it flexible for subscribers to invest.

Unique features of deferred annuity

* Determined retirement fund

With deferred annuity, you determine the fund you want at retirement and make contributions toward achieving it.

It gives you an opportunity to contribute according to your capacity and contributions can be made quarterly, half yearly or yearly.

* Surrender value

Deferred annuity offers contributors opportunities to stop contributions according to stipulated rules and access contributions in line with rules stated in the policy documents.

* En bloc payment at maturity

Unlike the contributory pension scheme where contributors with RSA balance that is over one third of the minimum wage can not get their total RSA balance, deferred annuity subscribers have the privilege to access the total amount contributed over the years.

* Linked term assurance

Deferred annuity could be backed with term assurance. This means a contributor who lives to the maturity of the policy can claim also the projected amount in the term assurance policy.

Flexibility makes investments easy and that is one of the unique features of deferred annuity.

To effectively control and dictate what you want at retirement, consider deferred annuity today and consult a reputable life insurance company to commence the journey to a comfortable lifestyle in retirement.