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The short answer
Under Nigeria's Contributory Pension Scheme you can draw retirement benefits from your RSA when you retire under your terms of employment or reach age 50, whichever is later. You then take a lump sum plus either programmed withdrawal from your PFA or a life annuity from an insurer, and the lump sum is allowed only if what remains can pay a pension of at least 50% of your annual remuneration at retirement. Earlier access is limited to cases such as the 25% job-loss withdrawal and retirement on health grounds.
Fifty is the age most RSA holders hear about, and it causes confusion in both directions. Some people think they can collect their whole pension on their 50th birthday while still working; others assume nothing is available until 60. The actual rule sits between those, and the options at that point matter as much as the age.
The rule: retirement or 50, whichever is later
PenCom's Guidance Note on the Revised Programmed Withdrawal Template (Version 2, published December 2024) applies benefit calculations to an RSA holder at retirement or at age 50, whichever is later. TrustFund Pensions' benefits page puts it the same way: normal retirement benefits are for those who retire under their terms of employment or reach 50, whichever comes later.
In practice that means two conditions. If you retire at 48 under your employer's rules, you generally wait until 50 for retirement benefits. If you turn 50 but are still employed, you generally wait until you retire. Some press reports have described the threshold as 55; PenCom's own guidance note uses 50, and that is the figure to rely on unless PenCom says otherwise.
The three ways benefits are paid
- Programmed withdrawal
- Your PFA pays you monthly or quarterly from your RSA, calculated on your balance, final salary, age and gender using PenCom's template. The money stays invested with the PFA.
- Retiree life annuity
- You use your RSA balance to buy a regular income for life from a life insurer licensed by the National Insurance Commission.
- Lump sum
- A one-off payment at retirement, taken alongside programmed withdrawal or an annuity, subject to the 50% test below.
Our comparison of programmed withdrawal and annuity sets out the trade-offs.
How much lump sum you can take
The guidance note says a lump sum is permitted only if the balance left after it is enough to buy an annuity or fund programmed withdrawals of not less than 50% of your annual remuneration as at the date of retirement. The same note lifted an earlier restriction that capped lump sum access at 50% of the RSA balance, so the size of the lump sum now turns on the remaining-pension test rather than a fixed share of the balance.
The calculation uses PenCom's template, including the A55 adjusted mortality table and the assumed rate of return and fees the Commission sets. Your PFA runs it and shows you the result before you choose.
Worked example
Example only, with invented figures. Ngozi retires at 52 with an RSA balance of ₦20,000,000 and a final annual remuneration of ₦3,600,000. Her pension after any lump sum must be at least 50% of ₦3,600,000, which is ₦1,800,000 a year or ₦150,000 a month. Suppose her PFA's template shows that funding ₦150,000 a month for her expected lifespan needs ₦14,000,000. The remaining ₦6,000,000 (₦20,000,000 minus ₦14,000,000) is the most she could take as a lump sum. If she wants a larger monthly pension, the lump sum shrinks.
Where your money sits as you approach 50
PenCom's 2023 FAQ sets out the multi-fund structure: Fund II is the default for contributors under 50, Fund III is for those aged 50 and above, and Fund IV is for retirees. In practice your RSA moves towards the more conservative funds as you near and pass 50, and into the retiree fund once you start programmed withdrawal. Ask your PFA which fund you are in now and when it will move you, so that a market fall just before retirement does not surprise you.
There is no upper age at which you must start. The same guidance note says the template now accepts retirees aged 65 and above, so someone who keeps working past 60 can still take programmed withdrawal or an annuity when they finally retire. Benefits are worked out on the balance and final salary at that later date.
Exceptions: access before retirement benefits
- Job loss: if you leave a job and do not find another within four months, you may withdraw up to 25% of your RSA balance, once. See how to apply for 25% of your RSA.
- Health grounds: TrustFund Pensions' page says holders certified unfit to work by a qualified medical board or physician may access their balance on leaving employment.
- Small balances: where the balance cannot provide a pension of one-third of the prevailing national minimum wage, the whole balance may be paid at once (en-bloc), according to the same page.
- Mortgage equity: up to 25% of the balance for a residential mortgage deposit, under separate PenCom guidelines.
What to check first
- Complete data recapture with your PFA; benefit requests depend on it.
- Get a current statement and confirm every employer's contributions are in (see checking remittance history).
- Ask your PFA for a programmed withdrawal computation and, if you are considering an annuity, quotes from approved insurers.
- Compare the monthly figure, the lump sum and what happens to the balance on your death under each option.
- Plan where the lump sum goes before it lands.
Where Pryme fits
A lump sum often arrives with several jobs to do. Pryme's Naira Savings Boxes let you separate it into a Flexible Box for near-term needs and Fixed Boxes for dated plans, with rates shown in the app before you commit.
Questions people ask
Can I collect my pension at 50 while still working?
Generally no. Retirement benefits apply at retirement or age 50, whichever is later, per PenCom's programmed withdrawal guidance. Earlier access is limited to cases such as job loss or ill health.
How much lump sum can I collect from my pension?
As much as leaves enough to pay a pension of at least 50% of your annual remuneration at retirement. Your PFA computes it using PenCom's template.
What is the retirement age for pension in Nigeria?
Your employer's terms set when you retire; RSA retirement benefits start at that point or at 50, whichever is later.
Can I withdraw all my pension at once?
Only if the balance is too small to fund a pension of one-third of the national minimum wage, in which case it may be paid en-bloc, according to TrustFund Pensions' benefits page.
Sources
- Guidance Note on Revised Programmed Withdrawal Template Version 2, PenCom (Dec 2024) · accessed Oct 2026
- Benefit Payment Types, TrustFund Pensions · accessed Oct 2026
- Frequently Asked Questions 2023, National Pension Commission · accessed Oct 2026
- Highlights of the Pension Reform Act (PRA) 2014, Standard Bank Community · accessed Oct 2026
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