Low-earning pensioners can now choose to withdraw their total retirement savings as a lump sum or continue receiving their monthly pension until the Minimum Pension Guarantee is approved.
This new directive, issued by the National Pension Commission (PENCOM), follows a revision to the regulation governing retirement and terminal benefits. The change, outlined in a memo signed by A.M. Salem, Head of PENCOM’s Surveillance Department, was prompted by the recent increase in the National Minimum Wage to N70,000.
Previously, retirees could only access one-third of their total Retirement Savings Accounts (RSAs). The memo, dated November 27, 2024, states that retirees whose monthly pensions are less than one-third of the new N70,000 minimum wage (approximately N23,333.33) can now choose to either receive their full RSA balance in one lump sum or continue with their current pension payments.
Pension Fund Administrators have been instructed to apply the new minimum wage in processing retirement benefits, in line with the revised regulation. Retirees opting for a lump-sum withdrawal must submit necessary documentation for approval by PENCOM. The updated regulations take effect immediately.
