1. What is the Nigerian Pension Calculator?

The Nigerian Pension Calculator estimates monthly pension under programmed withdrawal using the Retirement Savings Account (RSA) balance and annuity factor based on life expectancy. This calculation helps retirees plan their financial future under Nigeria's contributory pension scheme.

2. How Does the Calculator Work?

The calculator uses the pension formula:

Where:

• \( RSA\ Balance \) — Retirement Savings Account balance in Nigerian Naira (NGN)
• \( Annuity\ Factor \) — Factor based on life expectancy and interest rates (unitless)
• \( Pension \) — Monthly pension amount in NGN

Explanation: The annuity factor represents the present value of a monthly pension stream based on life expectancy and assumed interest rates, converting a lump sum RSA balance into regular monthly payments.

3. Importance of Pension Calculation

Details: Accurate pension calculation is crucial for retirement planning, ensuring sustainable income throughout retirement years, and making informed decisions about retirement options under Nigeria's Pension Reform Act.

4. Using the Calculator

Tips: Enter your RSA balance in NGN and the appropriate annuity factor provided by your Pension Fund Administrator (PFA). Both values must be positive numbers.

5. Frequently Asked Questions (FAQ)

Q1: What is an RSA balance?
A: RSA (Retirement Savings Account) balance is the total accumulated savings in your pension account, comprising your contributions and your employer's contributions plus investment returns.

Q2: How is the annuity factor determined?
A: The annuity factor is calculated by Pension Fund Administrators based on life expectancy tables, interest rates, and other actuarial factors specific to the programmed withdrawal option.

Q3: What is programmed withdrawal?
A: Programmed withdrawal is one of the retirement benefit payment options where monthly pensions are paid from the RSA balance while the remaining funds continue to earn investment returns.

Q4: Can I change my pension payment option later?
A: The choice between programmed withdrawal and annuity is usually made at retirement and may have limited flexibility to change afterward. Consult your PFA for specific rules.

Q5: Are there minimum pension amounts?
A: Yes, there are regulatory guidelines on minimum pension amounts. Your PFA can provide current minimum requirements and ensure compliance with pension regulations.