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2019 | 35 | 150-171

Article title

An assessment of adequacy of pre-retirement savings for sustainable retirement income under the Nigerian 2014 pension scheme


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Aim/purpose – The main objectives of this article are to estimate percentage of preretirement savings that is needed, based on the current salary scale, to sustain academic and non-academic staff of Federal Universities in Nigeria in retirement using University of Lagos as a case study. Design/methodology/approach – The methodology of the article was designed by modifying the life-cycle model of household behaviour combine with the target replacement ratio benchmarks for different income levels as used by Pension Commission 2004, expressed in 2013 earning terms. Finding – The research findings show that the lowest income earner with entry age of 25 years and retirement age of 65 years should, without any interruption throughout the service years, contribute a minimum of pre-retirement savings of 28.01% on an annual basis from his or her emolument to maintain the pre-retirement standard of living once he/she has ceased working. Research implications/limitations – The scope of this research study is subjected to some limitations: (1) scarcity of pension financial data in Nigeria; (2) the academic and non-academic staff of Federal Universities in Nigerian using University of Lagos as a case study. Originality/value/contribution – The study has established the minimum contribution rate into the Retirement Savings Account so as to meet the internationally acceptable replacement ratio for employees of the Nigerian Federal Universities.






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  • Department of Actuarial Science and Insurance. Faculty Business Administration. University of Lagos, Akoka, Yaba, Lagos, Nigeria
  • Department of Actuarial Science and Insurance. Faculty Business Administration. University of Lagos, Akoka, Yaba, Lagos, Nigeria
  • Department of Actuarial Science and Insurance. Faculty Business Administration. University of Lagos, Akoka, Yaba, Lagos, Nigeria


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