12 Things You Must Know About Withdrawing From Your Retirement Savings Account

AIICO Pension Managers Limited, a licensed pension fund administrator with over 40 locations spread across Nigeria is managed by seasoned and well-tested executives with vast experience in Pension Administration, Risk Management, Banking, Capital Market and Asset Management.As it continues to expand service flexibility in the Pension Fund Administration industry, the National Pension Commission (PenCom) has released draft guidelines for making withdrawals from funded Retirement Savings Account (RSA) toward equity contribution for residential mortgages.The top highlights of the draft guideline includes:1. The RSA holder shall be in active employment, either as a salaried employee or self-employed person.2. Mortgage loans can only be obtained from Primary Mortgage Banks (PMB) and Deposit Money Banks (DMB) licensed by the CBN3. A RSA holder can only access a portion of his/her RSA balance as equity contribution towards a residential mortgage loan once in a lifetime.4. An eligible RSA holder will be allowed to access a maximum of 25% of RSA balance as equity contribution for a mortgage loan.5. The RSA holder should have been contributing consistently for a minimum of 10 years, prior to the application for drawdown.6. An RSA holder that has accessed a mortgage loan may not be entitled to a lump sum payment at retirement.7. The loan can only be used to purchase a primary home which will be occupied by the RSA holder.8. The allowable mortgage loan amount will be between a minimum of N1.5million - and maximum of N50million.9. The tenor of the mortgage loan will be for a minimum of 5 and maximum of 20 years.10. The interest rate on the mortgage loan will be fixed for the duration of the loan.11. The RSA holder's Debt to Income ratio shall not exceed 33.33% of his/her net monthly income at the time of applying for the mortgage. The RSA holder's debt shall be the sum of the monthly mortgage repayments and other personal debt obligations that impact on his monthly income.12. The RSA holder shall provide all the required documentation in line with the guidelines.NOTE: The guideline is a draft from the National Pension Commission. Readers will be updated immediately the final version is approved by the Commission.For more information, call 0700-AIICOPFA or e-mail info@aiicopension.com. AIICO Pension Managers Limited is a licensed pension fund administrator with over 40 locations spread across Nigeria. APML is managed by seasoned and well-tested executives with vast experience in Pension Administration, Risk Management, Banking, Capital Market and Asset Management. www.aiicopension.com
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