By Patricia Osman
National Social Security fund has today launched a benefits payment plan dubbed NSSF Draw Down Payment Plan.
The funds’ deputy managing director Patrick Ayota says the savings plan will allow qualifying members the option of receiving a portion of their savings while retaining the balance of their savings with the fund. Innovation will be eligible to members who qualify for Age Benefit and Withdrawal benefit.
According to the NSSF Act Age benefit is paid to a member of the fund if he or she attains the age of fifty years and has retired from regular employment, or if he or she attains the age of fifty-five years.
Withdrawal benefit is paid to a member of the fund if he or she attains the age if fifty years and if he or she has not been employed under a contract of service for a period of one year immediately preceding his 0r her claim.
Withdrawal Benefit is also paid to any person who ceases to be a member of the fund by virtue of being employed in excepted employment.
Speaking at the launch of the plan at workers house, Mr Ayota says the plan will enable qualifying members to utilize their NSSF savings slowly as they work through a retirement plan or investment that works for them. *We have received several requests from qualifying members to pay them a portion of their savings and pay the balance in installments as they finalize their investment plans for the large sums saved* Ayota said. *it helps extend income security during retirement because a member can decide how much they wish to retain their NSSF account and when they wish to claim it. This will enable our members to avoid the risk of burning out life’s savings upon payment of a lump sum at a go by cushioning against losses, which may arise out of making rushed investment plans for the large sum saved* Ayota added.
Ayota also says that members who enroll for the plan would continue to receive annual interest on their balances retained by the fund in line with the interest that will be declared by the responsible minister in a given financial year.
This plan comes after a survey conducted by the fund amongst 45-60-year-old members where 62% said they would consider the payment of their benefits in installments rather than receiving them in a lump sum.
Now according to an earlier internal survey by the fund, more than 70% of the beneficiaries had depleted their savings received within 2 years, and most wished they had had an opportunity to receive their savings in bits.