Business

How to use your pensions for mortgage

Published

2 years ago

September 26, 2022

The National Pension Commission recently approved the guidelines to access Retirement Savings Account balance for payment of equity contribution for residential mortgage by RSA holders.

The approval was in line with Section 89 (2) of the Pension Reform Act 2014, which allows RSA holders to use a portion of their RSA balance towards payment of equity for residential mortgage.

PenCom however specified conditions to access the funds. A major condition is that the applicant must be in active employment, either as a salaried employee or as a self-employed person.

It stated that application for equity contribution for residential mortgage must be in person and not by proxy.

How to apply

Anybody who is interested can approach his PFA to get explanation on the process. The PFA will print the statement of account and determine the 25 per cent.

Speaking with our correspondent, the Spokesperson, PenCom, Abdulqadir Dahiru, said, “Then when you have that, you can now go back to your mortgage lender, get a letter of offer of your property, go through their own due diligence to agree for them to finance because the pension is only giving you 25 per cent; 75 per cent will still be financed by somebody.

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“That person must give you an offer letter for a loan that he is ready to finance you, and this is the equity contribution you are required to bring. So if you have that equity contribution with that letter of offer, which has been validated by the mortgage lender, that is when you can approach your PFA to request for your 25 per cent.”

Maximum amount allowed

PenCom stated that the maximum amount to be withdrawn is 25 per cent of the total mandatory RSA balance as of the date of application, irrespective of the value of equity contribution required by the mortgage lender.

Where 25 per cent of a contributor’s RSA balance is not sufficient for payment as equity contribution, the RSA holders may utilise the contingency portion of their voluntary contributions (if any).

Consent form

If a person had accessed part of the funds before either for leaving paid employment before retirement age, he will still get lump sum at retirement. He can still get part of the funds for mortgage after meeting specific conditions stated in the guidelines, but he must sign a consent form to get it.

Aisha Dahir-Umar, DG National Pension Commission

Dahiru said, “If you have taken 25 per cent for temporary loss of job and then you get employment again, and you continue contributing and you come to collect for a mortgage, you will sign a consent to say that I’m fully aware that this money I want to withdraw to finance a house will affect the amount I may likely take when I retire, I understand and whatever.

“So, basically you are indemnifying the PFA that you understand so that at the point of retirement, if your benefit is lower compared to your colleagues you will not complain.”

Mortgage lender

To qualify as a mortgage lender for the purpose, the company must be licensed by the Central Bank of Nigeria, comply with the Contributory Pension Scheme and have valid Pension Clearance Certificate, according to PenCom’s guidelines.

Eligibility

According to PenCom, a worker must have an offer letter for the property duly signed by the property owner and verified by the mortgage lender. The RSA of the applicant must have both employer and employee’s mandatory contributions for a cumulative minimum period of 60 months (five years). A contributor under the Micro Pension Plan is also eligible, provided he/she has made contributions for at least 60 months (five years) prior to the date of his/her application.

Age limit

RSA holders that have less than three years to retirement are not eligible.

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Dahiru explained, “If I am an employee and working in an organisation where the retirement age is 55 years, if I am 50, or 51 years, I can access because I have five years or more than three years to retire. But once I get to 52 that, means I have three years which I cannot access.”

According to PenCom’s guidelines, married couples, who are RSA holders, are eligible to make a joint application, subject to individually satisfying the eligibility requirements.

Data recapturing

RSA holders, if registered before 1 July 2019, must have their records updated through the RSA data recapture exercise.

Dahiru said, “But it’s very important that RSA holders have done their recapture. When you have not done your data recapturing, we can’t process it.”

Insufficient 25 per cent contribution

The PenCom spokesperson said, “Where the 25 per cent the mortgage lender is asking for is equal to the 25 per cent of your RSA, definitely we will process. But if what mortgage lender is asking for is higher than what you can get from your PFA, you will have to look for the difference and pay and show evidence to your PFA.

“For instance, if your mortgage lender is looking for N2.5m and the mortgage is N10m, and the mortgage lender says bring 25 per cent as equity contribution, and your own 25 per cent in your RSA is only N1.5m, you will have to look for that difference of N1m and pay; then come with it with your offer letter for the property and the evidence that I have paid, then your PFA will give you the balance of N1.5m which is your 25 per cent.”

Punch

Business

Naira strengthens, gains N29.89 against US dollar

Published

2 days ago

March 15, 2025

Trends Admin

Naira strengthens, gains N29.89 against US dollar

The Nigerian Naira closed the week on a positive note, appreciating by N29.89 against the US Dollar in the official market.

According to data from the Central Bank of Nigeria (CBN), the Naira traded at N1,517.93 per dollar on Friday, reflecting a 1.9% increase from Thursday’s closing rate of N1,547.82.

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The currency’s recovery comes after a period of decline since March 5, offering a sign of relative stability. In recent months, the Naira has traded within a range of N1,500 to N1,900 against the dollar across both official and parallel markets.

This uptick suggests ongoing efforts to stabilize the currency may be yielding results, as market watchers remain hopeful for sustained improvements.

Naira strengthens, gains N29.89 against US dollar

Auto

How to lower fuel consumption of your car

Published

2 days ago

March 15, 2025

Trends Admin

How to lower fuel consumption of your car

When President Bola Tinubu announced an end to fuel subsidy at the inception of his regime in 2023, many motorists were jolted by the expected impact it would have on the cost of keeping their vehicles on the road.

Many Nigerians were also concerned about the impact it would have on the cost of living, especially the prices of goods, services and transportation.
And their fears were genuine; prices of goods went up astronomically and there were complaints of hardship all over the country.

This led to a swift drop on the sales of big cars, especially Sport Utility Vehicles. Many Nigerians quickly parked these cars in their homes and some immediately put up theirs for sale while others quickly bought smaller cars that they presumed would consume less fuel. They forgot that the rainy season would not be fair to the roads and their new small sedans, especially the bumpers and underneath the cars.

Those living in flood-prone areas like Lekki and some seasonally flooded areas in Rivers, Delta and Bayelsa states can attest to the advantages of SUVs over sedans from their expenses. With some of these expected challenges, it didn’t take long for the average Nigerian motorist to adjust and live with the negative impacts of the fuel subsidy removal.

Though the challenge persists, coupled with the poor state of the roads across the country, it has been almost impossible for Nigerians to totally do away with their big cars and SUVs which are renowned for higher fuel consumption. It is the classical case of choosing between the devil and the deep blue sea.

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Today, Vanguard offers you some tips on how to ensure maximum fuel economy in your vehicles at a time like this. It is clear that by improving your car’s fuel economy, you’re helping to reduce the drain on your wallet. With some simple driving tips and habits, your fuel can take you further. A combination of good driving habits, and proper vehicle maintenance of your car is essential.

The Tips

*When driving, accelerate and brake gently, quick starts and stops waste fuel, but smooth driving boosts your kilometres per litre. Driving at slower speeds leads to better fuel efficiency.

Reducing speed by 10-20 kph can help. Keep a steady speed, you may use your cruise control on motorways because when you drive at a consistent speed, you save fuel.

•Watch the traffic ahead, it will help you predict what other drivers will do or intend to do. This helps you to avoid braking and speeding up.

•Also avoid idling your engine for long periods even when it is stationary as it wastes fuel. Switch off the engine if you need to stop for more than a minute.

•Also limit short journeys, and be aware that cold starts use more fuel.

•As a motorist, ensure that your tyres are appropriately gauged. Soft tyres cause drag and waste fuel. Check pressures often and inflate correctly.

Many drivers don’t know that proper inflation of their car tyres contributes significantly to the fuel economy. Under inflated tyres have a higher rolling resistance on the road. This means that your tyres generate more friction and rolling resistance and will increase fuel consumption.

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If your four tyres are underinflated by 10 psi, this could increase your fuel consumption by 10 per cent. Car manufactures always have the recommended tyre gauge inscribed on the drivers door frame. Gauge your tyre accordingly and reduce your fuel consumption.

•Correct wheel alignment is vital. It reduces tyre wear and drag. This also saves fuel.

•Many motorists carry all sorts of things in their boots which they hardly need and this adds to the weight of the car, this should be avoided. Note that every extra 50kg of load in your car increases fuel consumption by about two to three percent.

Some used cars from abroad come with a heavy bar attached to the rear for pulling boats and other heavy objects from where they have been imported which is hardly needed in this part of the world. It is advised that you remove them to avoid unnecessary weight.

Some people however believe that this serves as protection when another vehicle hits them from behind, unknown to them that they are paying more to fuel their cars. Lighten your load and remove extra weight from the car. Less weight means better fuel economy.

•Also, reduce drag by removing roof racks as they increase wind resistance which wastes fuel.

•Use your air-conditioning system. Driving with an air-conditioner has an advantage to fuel economy but most drivers think otherwise.

Apart from keeping the interior of your car clear of dust and ensuring the safety of the driver from attacks, it also saves fuel. Driving with windows down at a speed faster than 80km/h causes a lot of wind resistance and more fuel consumption. It is more fuel efficient to drive with your air-conditioner on.

•Maintain the right speed. Avoid over speeding and going slowly too.

While both have safety consequences, they also have an impact on your fuel consumption. It has been established that on highways, your engine works hard to overcome wind resistance.

This means that you will burn up to 15 per cent more fuel at 100km/h and 25 per cent more at 110km/h. On the other way round, if you drive at a speed slower than 50km/h your engine would drop to a lower gear thus using up more fuel. It is advised that driving between 50km/h and 90km/h gives optimal fuel efficiency.

•Many people accelerate their cars as if they are running at Formula 1 Race thereby wasting their fuel unknowingly. Avoid revving your accelerator to a high revolution per minute (RPM). Your engine uses less fuel when it is revolving slower at a lower RPM.

•It is also important to note that aggressive braking is not only a disadvantage to the brake pad but increases fuel consumption.

Slamming on the brakes increases fuel consumption as the car needs to accelerate again. Give a reasonable distance between you and the vehicle in front of you. If you have been driven by a pilot before, you would understand what it means to drive with caution.

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They are very cautious of the vehicles in front of them and avoid them from afar. I am sure that if we take count of professionals who hardly get involved in traffic accidents, the pilot would take the number spot.

•Avoid hard acceleration when moving your car from complete stop or climbing hills as it increases fuel consumption. Most people who drive vehicles with automatic transmission hardly know the advantage of one special feature in the car called cruise control.

If you are driving an automatic car, you can make use of cruise control to keep your speed constant. But if you are driving a manual car, maintain a higher gear when appropriate. This ensures that your engine goes through less revolutions per minute, RPM and ensures less fuel consumption.

•Driving in traffic causes higher fuel consumption. Stop-start traffic puts a lot of pressure on your engine and burns more fuel. Avoid peak traffic if possible. Turn off your engine when it is parked. As long as your engine is on, the fuel is burning. The choice is yours to keep the engine steaming when that car is not moving. It is your fuel that is burning which you can use to cover some kilometers.

•Regular servicing with quality engine oil is key to the longevity of your engine. If your engine is poorly maintained, it will lead to sludge and corrosion build-up which will prevent the engine from working smoothly. Regular maintenance is key.

•Follow your vehicle’s schedule, a healthy engine works better. A clean air filter lets the engine breathe freely. Good airflow improves fuel use. Use the right oil type to reduce friction and boost engine performance. When buying a new car, think about fuel efficiency. Pick a model that fits your needs. If your car has a fuel-saving mode, then use it.

How to lower fuel consumption of your car

Vanguard

Business

Electricity: TCN blocks access to data from DisCos

Published

2 days ago

March 15, 2025

Trends Admin

Electricity: TCN blocks access to data from DisCos

Different interest groups in the Nigerian Electricity Supply Industry (NESI) yesterday raised the alarm as the Independent System Operator (ISO) of the Transmission Company of Nigeria (TCN) blocked access to distribution companies (DisCos) daily load profile on its website.

The section of the website has been inaccessible for over a month with no one offering explanation.

Meanwhile, the Transmission Company of Nigeria (TCN), spokesperson, Ndidi Mbah did not answer calls to her mobile line. She also refused to respond to the WhatsApp message sent to her for inquiry.

Responding to the situation, Sage Consulting, Lead Power Sector Analyst, Mr. Bode Fadipe said the fact that the TCN barred access to the DisCos load profile for this long raises the question if it has something to conceal from the stakeholders.

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He described the website’s daily load profile as the tool with which customers and other members of the public can assess the performance of the energy distributors.

Fadipe stressed that platform should be a validation measure for holding the DisCos accountable.

He said allowing the DisCos to operate without access to the load profile could aid them to reject load.

His words: “If other information is accessible on that platform and it is not a technical issue what could be responsible for that? Do they have anything to hide?

” If they have resorted to that, we call for greater transparency so that it can help us to see performance. I think it is not a very good sign because the power sector is supposed to be a transparent industry where people can pick up information and the public can monitor all the time and be able to hold DisCos responsible.”