The Horrible Side of Unplanned Retirement

I cast my mind back to about 10 years ago when I was working with one of the foremost and oldest life and pension offices in Nigeria. Our CEO at that time (who still remains one of the best brains in life assurance and pension management in the country up till today) gathered us, the Management members, together one evening to address us. He said something that went like this,:

 “Ladies and gentlemen, we have to come up with a product that will address the issue of retirement in this country. The product must be unique in nature, and it must be presented in such a way that it will catch the attention of the public and arouse people’s interest. I look around and can see a lot of people suffering from the negative effects of unplanned retirement. Our company must solve this problem for as many people as possible. We should be seen as eradicating old age poverty.”

He went further to talk about retirement for the next twenty minutes or so and finally opened the floor for contributions.

What an interesting evening! Each person had something to say about one uncle or aunty that suffered the fate of unplanned retirement. Examples upon examples were given, and we all agreed that we needed to do something about it. That evening therefore marked the beginning of countless hours of discussions, drawings, calculations, presentations, facts findings, interviews, and pages upon pages of writings. Finally, a new product was born and we named it Personal Pension Plan (PPP).

Something stood out during those many hours of preparation, and it continued to make waves well after the launch of the product. That was the product’s flagship picture of a wretched, dejected, and poverty-stricken man we called Mr. Jack. The picture had the caption, “All work and no retirement plan makes Jack a sad man.” It was rather unusual in the history of life insurance marketing in Nigeria. Everywhere we turned, people would immediately remember Mr. Jack before even remembering the name of our company. The name “Mr. Jack” immediately became associated with the company. We had Mr. Jack’s posters everywhere; at the entrance of our offices, on our vehicles, on billboards…just name it. Mr. Jack became the talk of the town.

In our numerous presentations of the PPP product at that time, we told people that Mr. Jack was a man who spent many years in office and eventually retired at the age of 70. Though the official retirement age was 60, he refused to leave until 10 years after. He succeeded in beating the system by smuggling in a new Sworn Affidavit that cut his actual age by 10 years. He desperately wanted to continue to look young hence he resorted to dying his hairs with black substance.

Why did Mr. Jack have to do all this? Simple: He was scared! He was afraid of what would befall him after retirement. This was a man who had everything at his beck and call while in office. He was a senior officer at one of the Government Ministries. He had more than 15 official cars in his compound at every point in time. His office occupied an entire floor of a building. He travelled abroad almost every two weeks. He was fond of going on overseas holidays with his wife and extended family members with all bills footed by him. He was entitled to thousands of dollars per night as overseas travelling allowances. He belonged to almost all the expensive social clubs in town. His official residence was a big mansion in the highbrow area of Lagos with 24-hour electricity supply through an installed giant generator.

Mr. Jack’s two kids were in schools outside Nigeria. One was in the University in the UK while the second was in the High School in America. Each of the schools was one of the top five in their respective countries.

Mr. Jack’s wife was a full time housewife. She needed to be because of the number of important dignitaries that thronged their house on a daily basis. Someone had to attend to all of them. Yet, Mrs. Jack didn’t need to be personally involved with any of the house chores. She had ten domestic servants to take care of everything. All she needed to do was supervise. And that was what she did daily. The cleaners, the gardeners, the drivers, the cooks, the technicians; all were Mrs. Jack’s staff. So, she was actually an “Executive Housewife.”

Everywhere in Mr. Jack’s mansion smelt of wealth. All the available floor areas were fully clothed with expensive rugs of different shapes and colour. Every room, including the toilets and Mrs. Jack’s kitchen, had powerful air conditioners installed in it, and they all worked on a 24-hour basis! Did someone wonder, “including toilets and kitchen?” Yes, they were all fully rugged and fitted with powerful ACs. Money was really talking in Mr. Jack’s house.

In Mr. Jack’s mansion were many rooms. And in those rooms were many people living on Mr. Jack’s money. Those people included Mr. Jack’s relations, his wife’s extended family members, some church members, Mr. Jack’s friends’ children, his wife’s friends’ children etc. They all numbered 25. What a great man Mr. Jack was!

None of Mr. Jack or his wife ever moved alone. They moved in a convoy.  When there was any important ceremony to attend, at least four cars must accompany either of them. And at least six people must be with Mr. Jack at every point in time – apart from the two special police escorts that were ever at attention. One person would carry Mr. Jack’s briefcase, another one would carry his purse which was usually full of Naira notes and foreign currencies. His Personal Assistant would be nearby with his diary in case Mr. Jack suddenly remembered something or needed to give someone an appointment. On a day that Mr. Jack wore his three-piece agbada traditional flowing dress, someone must be at hand to carry the top-piece agbada for him in case he suddenly got tired of wearing the three together.

In a nutshell, Mr. Jack and his family lived in splendor and abundance. They lacked nothing. They, indeed, knew how to enjoy life.

So, who would want such a life of luxury to end? That was why Mr. Jack didn’t want to leave office. But one day, as Mr. Jack settled down in his living room with his wife and one of his junior brothers; eating fried chicken and drinking red wine, an announcement came on the National Television. It was the popular 9.00PM network news. The newscaster was unconcerned. The message was delivered short and straight. Mr. Jack had being retired from service with immediate effect.  He had been replaced with another man from his Ministry, also with immediate effect.

It was like a bombshell. Nobody in that living room could talk for the next five minutes. They all knew the implications of that announcement. Yet, the television did not stop working because of that. The lady newscaster continued to cast the news.

The second day, Mr. Jack and all the people living with him were ejected from the official mansion. That was what “immediate effect” meant in those days. They were not allowed to take anything with them. Not even one of the official cars.

And that was the beginning of Mr. Jack’s problems. He started phoning his friends up and down for assistance. Many of them simply refused to pick his calls. They had heard the news on TV and radio. He was no longer in their class, so why should they answer him? The few that reluctantly answered his calls had one excuse or the other to give. One of them sympathized with him on the phone, “Oh, Mr. Jack, so sad to hear about your sudden retirement. But I’m out of town right now. I will see what can be done to help you when I return next month.” Poor Jack, he never heard from that same friend again. Nobody offered any help; only unfulfilled promises.  

Finally, Mr. Jack had to turn to his church Pastor who was kind enough to harbor him and his wife in the church mission house.

The next few months were very tough for Mr. Jack, to say the least. He was broke to the bone! He had to withdraw his children from schools when he couldn’t meet up with the payment of their fees. His creditors were on his neck every day. He became rejected by the same society that once hailed him as a Capo di Tuti. He couldn’t believe what was happening to him. “So this is what life is?” he kept asking himself.

Mr. Jack had no savings. He had no pension plan. He did not make adequate plans for his retirement. He got carried away with the allure of his office, and his employer’s promise of future pension and gratuity payments. But the government simply included his name as one of the retirees being owed pension and gratuity benefits. When and how that payment would be made could not be determined. Mr. Jack would have to wait for his turn, which could take years.

So, what was our PPP message in my formal company? It was straightforward and clear to everyone, “Plan your retirement properly.” Imagine how different life would have been for Mr. Jack if he had taken care of his retirement financially. What if he had put in place a personal pension plan for himself? What if he had invested his money? What if he had been much more frugal? What if Mr. Jack had prepared for the rainy days? What if he had not relied solely on what the government promised him as retirement benefits? Of course, life would have been better for him.

You may want to say, “But that was before we had the Pension Reform Act 2004 in Nigeria.” Yes, I agree. The Pension Reform Act has changed things for better for Nigerian workers. In fact, it is one of the best things to have come from the government in recent years. Today, each contributor has his or her Retirement Savings Account (RSA) in place. A worker knows that the amount in his account would be paid to him sometime in future, and the money is already kept inside his RSA. He can also check the balance with his Pension Fund Administrator (PFA) at any time.

But that’s not the end of it all. A great number of people are not within the purview of the Pension Reform Act yet. For them, there is nothing like retirement savings account at the moment! We shouldn’t forget that state employees are not covered by the Pension Reform Act 2004. Quite a number of states are yet to imbibe the new Federal culture on pension. And for those who have their Retirement Savings Accounts opened with their preferred PFAs, the amount in each of such accounts is limited to a percentage of their remuneration. The account balance at retirement will also be subject to a number of factors such as investment performance and inflation.

In summary, therefore, the new pension regime is a big relief for Nigerian workers. With time, I believe, those who are yet to join will do so. This means that our Mr. Jack of today may not be the same as the one depicted in my previous employer’s PPP product. However, we must press the clutch and note that there are still thousands of Messrs. Jacks everywhere. The message here is simple: It is the primary responsibility of each one of us to prepare for our future, to think about our retirement, and save against the raining days. The Pension Reform Act provides the basic. It is the start; the foundation for a joyful retirement. We must build on it individually.

I have a beautiful way of ending this kind of discourse. It has to do with the billboard of a particular bank some years back. In that billboard was the photograph of a man balancing steadily in front of a big bowl of amala local food, accompanied by another bowl of assorted meat, and drinks. The man had to himself enough food that could feed four people! It was a vivid picture of an ardent epicure. But the caption of that billboard advert read: “Do not eat your future today.” That is my message to you too. Mr. Jack ate his future while in service. Don’t be like him.

Do a quick scan of your life. Are you in anyway eating your future today? If yes, make amends immediately. The future is around the corner. Be prepared!

I sign off…for now.

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