Retirement Account

1 min read

The question of retirement is in the minds of all people who are working whether in the formal or informal sector so it's a matter of choosing where to keep your funds. At old age, most people prefer in investing in risk-averse items such as retirement homes, farming for personal consumption, bank securities, and insurance funds. But before reaching the goal of getting a pension entities put their money in retirement accounts. Wherever your employer is deducting your pension keep in mind there are two major retirement schemes and that is :

1. Defined contribution plans-When an entity pays a fixed amount to a retirement fund but has no obligation to extend his contract when the retirement fund has become insolvent or is not able to pay its obligations of the past, present and the future. The benefits are acquired as a result of the fixed contributions.

2. Defined benefit plans- These are benefits that accrue as a result of contribution but they don't end when the fixed contributions have stopped. The benefits though are related by the amount contributed. 

What you should look out for in your account

1. Date of employment

2.Date of retirement

3.Date of joining scheme

4. Number of pensionable service years before retirement

5. Date of retirement

6. The registered portion both by the individual and employer

7.Unregistered portion both by the individual and employer

8.Interest earned

9.Service cost

10. Tax free lumpsum

11. Taxable lumpsum

12. Withholding tax

10. The person preparing  your payments 

11. The dates of payment

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