BY ALBERT AMEKUDZI
NBC GHANA Trust has charged Ghanaians to make a deliberate effort and invest in the Tier 3 pension scheme for a better future.
Chief Executive Officer (CEO) of NBC, a leading private pension scheme administrator, William Asiedu Yeboah indicated that the surest way to a happy old age is to save towards retirement, hence, the need for workers both in the formal and informal sector to invest in the Tier-3 pension scheme.
He said this while sharing his views on the importance of investing in pension schemes and how to enjoy life after retirement.
Mr Yeboah explained that “every worker retires with the hope of enjoying good life after their working life cycle, but some get disappointed at the end because some employers fail to pay their workers’ contributions as expected.”
He stated that the introduction of the two new pension tiers: Tiers 2 and 3, have paved the way for employers and employees to contribute more for a better future.
As per the Pension Act 2008 (Act 766), Ghana operates a three tiered pension scheme. Tier-1 is made up of a mandatory monthly contribution of 13.5% of basic salary managed by SSNIT. Tier-2 is a mandatory contribution of 5% basic salary managed by a licensed Fund Manager. Tier-3 is an optional contribution also managed by licensed Fund Managers.
In addition, the Tier-3 is voluntary and it is up to the employee and or employer to determine how much of the employee’s salary would be contributed to this tier.
He further noted that one of the benefits of investing in the Tier-3 pension scheme is that the tax benefits can increase the retirement benefits, adding that “government will give tax relief on your pension at retirement. Also, you can take your pension savings as a tax-free lump sum upon retirement.”
Mr Yeboah further stated that most pensioners go home with relatively huge lump sums as retirement packages, but their monthly packages may not be able to sustain them over a long period, thereby forcing them to fall on relatives for help.
The CEO of NBC Ghana Trust also called on workers to make conscious effort to start a Provident Fund under the Tier-3 pension scheme.
He stressed that “it is important to do this with a registered pension scheme administrator to avoid disappointment as being witnessed by people who have lost their jobs recently.”
Mr Yeboah said it was painful to lose one’s job but it was worse to lose the money personally saved during one’s working life.
He noted that “it is important for pensioners to have an idea about their pension package before retiring, to help them plan well and enjoy their post-working life.”
According to him, investing with the right pension scheme administrator will save you from the trauma and make it easy for one to receive bulk sum whenever one decides to do so.
He added that NBC Ghana Trust had built a robust system that could help clients know their investment anytime.
“While it is good to invest in a pension scheme, it is also important for people to consider the right pension scheme administrator to invest with. An administrator with a strong operating system capable of managing huge data is the best administrator to invest with,” he reiterated.