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Are you on the other side of 45 and have little or no retirement savings? Have you ignored this most important stage of your life and suddenly find that retirement is looming?

Very few of us save enough for retirement and most people will fall short. Research has suggested that retirees will require about 60 to 70 per cent of their pre-retirement income to live just moderately well during retirement.

There are many diverse reasons why people find themselves in this precarious position.

Some have simply lacked the focus or discipline to save, whilst others find themselves at the centre of some catastrophic life event such as the loss of a loved one, a major illness, disability, or divorce that can have dire financial consequences.

Do a reality check

Be realistic about your actual situation – how prepared or unprepared are you? First, find out how much you have right now. Start by pulling together financial information such as your bank statements, and your projected pension payout or a gratuity, if you are fortunate enough to have one.

Take stock of all your assets. Even if you haven’t been saving as judiciously as you might have, you have probably built up some assets that could play a role. Then determine how much income you think you will need in retirement.

Finally, look for where that income could possibly come from.

Cut right back on your expenses

How much are you spending today? You must have a clear idea of where your money is going before you can ascertain where additional funds will come from. You will need to cut back drastically on any unnecessary expenses.

If you still have dependent children and elderly parents to support, prioritise and do only what absolutely must be done. If you have become the one stop shop for bailing out members of the extended family and friends, you really must learn to say ‘no’.

Retirement savings must become your priority and everything else has to take a back seat. Non-essential expenses like eating out often, travel, and shopping can easily get out of control.

Start saving as much as you can

It is important to seek professional advice. A financial advisor will dispassionately consider your current and projected circumstances. If you are in debt, start applying as much as possible to reduce this to free up money for retirement savings over time.

An advisor will recommend various options that might include an automated savings plan where funds are debited directly from your salary and into savings; this could include fixed income, balanced or equity funds, as well as other investment vehicles.

Don’t be too aggressive

You cannot afford to ignore your risk tolerance in your attempt to make up for lost time. Volatility is a reality in investing; as retirement approaches, there is little room for error and one must be more conscious of protecting the nest egg from the risk of loss.

A severe market downturn can be disastrous, as you will have far less time for the market to correct itself or for you to recover from poor investment decisions.

At the same time, you can’t afford to be too conservative and have inflation eat away at all your savings.

Your home can play a role

Do you have equity in your home? If your home is relatively valuable and your children have left home, if you are not too overwhelmed by sentimental attachment, a house that has appreciated in value can be sold and a smaller less expensive home purchased in its place.

Be conscious of the fact that falling property prices and a liquidity crunch have made it more difficult to sell property at a premium. If you live in an area with a high cost of living, moving to a less expensive area could make a big difference in your ability to amass a tidy sum.

Postpone retirement?

If you’ve done all your sums and clearly still won’t have enough in retirement, you have two choices: You may need to scale-back your retirement goals and lifestyle drastically, or you may have to postpone your retirement date.

Working a little longer or part time can improve your financial prospects significantly, as you will be able to invest these earnings and feed your retirement portfolio until you have to dip into it.

Leverage on your skills or talents

Can you create another stream of income to devote to retirement savings? Explore your options; it may well be something that you may have taken for granted and would do for free, that could turn into a side business.

Time is precious

No matter how precarious your finances might be approaching retirement, there is always some way to improve your situation.

You cannot make up for an entire career of not saving by trying to fast track your saving in the last 10 years of your working life. But there is enough time for you to make an appreciable difference in your retirement lifestyle.

Don’t let doubt or discouragement keep you from starting right away, regardless of your age.

All is not lost, but time is a critical factor, so don’t procrastinate a minute longer.

Food price hikes
are hitting Africa’s urban populations harder now than in 2008 and pose
a serious challenge to some of the continent’s leaders, who face
elections this year, a World Bank official said.

Policy makers
across the globe are fighting rising food prices, currently 36 per cent
higher than levels this time last year and near peaks from 2008,
according to the World Bank’s food price index.

“This time, because
it is a more broadly based price increase, because it brings in fuel
prices as well, the impact is more urban-based,” Karen Brooks, the
bank’s Africa agriculture sector manager, told Reuters, citing
increased pressure on wheat and maize costs.

“It is also coming
at a time of many elections in Africa, and so this goes into a
political context which makes it very challenging for governments to
manage,” she added.

The 2008 spike in
food prices led to violent demonstrations across much of Africa.
Protests have returned to the streets of some capitals, while tense
elections are due later this year in Cameroon, Liberia, Democratic
Republic of Congo, amongst others.

Ms Brooks said the
bank was particularly worried about the situation in Uganda, where the
opposition has latched onto complaints over rising prices and organised
protests, some of which have turned violent.

“It is not on the scale that we are seeing in North Africa, but there are very great concerns,” she said.

In the aftermath of
the 2008 crisis, world leaders in 2009 pledged some $20 billion to spur
agricultural investment in poor nations and fight hunger.

Ms Brooks said
investors were excited about African agriculture, but that the
continent was still missing out due to lingering fears over land
rights, taxation and stability, as private funds flow into Latin
America and Central Asia.

African leaders
have committed to devoting 10 per cent of their budgets to agriculture,
as part of efforts to bridge investment gaps. But Ms Brooks said
results were mixed.

“There were
substantial commitments made, but it has been very difficult for the
donors to actually follow up on the commitments as the financial crisis
hit,” she said, adding that complex accounting methods by donors meant
it was a puzzle to work out what had been delivered by whom so far.

Four pillars

Meanwhile, some
African nations have made progress in adopting policies and most have
recognised the urgency, but just a handful are meeting the 10 per cent
budget target.

Better weather has supported harvests this year, but the deficit remains vast.

“Of course, they
aren’t doing enough. There is such a deficit of investment in
agriculture that has accumulated over the last 20 years that there is
quite a lot that has to be done,” Ms Brooks further said.

She added that the
bank was focusing on four main issues: land and water management,
technology, agricultural markets and infrastructure, and food security
and vulnerability.

“There are so many
accessible advances in science that could be applied in Africa, but
they require the participation of African scientists in order to figure
out the best varieties,” she said, citing as an example the choice of
best hybrid maize for different conditions.

Rising food prices
have ramped up investor interest in agriculture, with Boston-based farm
consultancy, High Quest, seeing inflows of private capital in the
sector more than doubling to around $5 billion to $7 billion in two
years.

Africa is still only partially cashing in.

“What we are
finding is that there is a high level of excitement. However, because
the business climates in many African countries are less well-advanced
… Africa is still lagging,” Ms Brooks said.

Poor infrastructure, weak financial services, and concerns over land
rights are among the key concerns the World Bank is trying to tackle,
to encourage investors to turn to Africa, rather than other regions
where returns are quicker, she added.

REUTERS

Michael Itegboje, the president of the Chartered Institute of Stockbrokers (CIS), says stockbrokers should not be singled out for the stock market crisis that was also due largely to regulatory lapses.

How would you assess the capital market in the first quarter of the year?

Nothing much has
changed except that the market is a bit more stable now, unlike a year
ago. Since January, things have been better.

The market has
moved up slightly, though it also went down slightly. It is moving up
gradually now as more company results come in. People have confidence
in the ability of the companies to perform.

2010 performance
has shown that the companies are improving and most of them have
overcome the difficulties thrown up between 2008 and 2010.

Overall, you can say the market has gained about seven to 10 per cent.

Would you attribute this recovery to any deliberate effort by the regulators?

Like I said, the
companies’ performance are the major indices and not through any
regulatory effort. Companies are releasing their result, and investors
are beginning to see that there is improvement in their performance in
terms of profit, growth, and improvement in the balance sheet of many
of them.

What would you say about the environment in which you operate today?

The environment is hostile to stockbrokers in Nigeria. It is terribly hostile, especially from the regulatory point of view.

It seems in order
to bring confidence back to the market and correct anomalies of the
past, the regulators seem to blame everything on the stockbrokers,
forgetting that the whole crisis that happened in Nigeria and the rest
of the world was mainly due to regulatory failure.

The regulators
failed to do their job. In trying to do that, the regulatory
environment does not have to be hostile for sanity to prevail. Yes, we
all have learnt our lessons because if there is no business in the
market, there will be no other business for stockbrokers to do. Once
investors are not forthcoming, brokers suffer because there will be no
business.

That is why we have
been redirecting our resources to bring confidence to the market so
that our businesses can grow. Right now, our businesses are not growing
as we should expect.

While
brokers can be blamed partly for the crisis, what safeguard has the
institute put in place to ensure that your members do not repeat the
abuses of the past?

We have put some
things in place since October and have been training our members on the
code of ethics and standard of professional practice that would guide
them.

Secondly, we
introduced the continuing professional development programme in which
we are training our members on the current skills and knowledge in
capital market. The training is serious because credit points are
awarded for training a member who attends. We believe with that our
brokers are better prepared to face the task of the present and the
future.

Not only that, new ways of doing business in an environment that is dynamic. We are working on those areas.

I was actually
expecting you would talk about disciplinary measures put in place
against errant members to put off some of the hostilities of the
regulator?

Now, let’s get
something straight. The Chartered Institute of Stockbrokers has a
tribunal and on that tribunal, there is an assessor.

Previously, the
assessor used to be a SAN (Senior Advocate of Nigeria) but as part of
our reform agenda, we decided to make the assessor a retired justice
and we have right now, a retired justice of the Supreme Court on the
tribunal.

We also have a
prosecutor who is a SAN of many years standing. Over the years, even
before this crisis, this disciplinary tribunal has been there trying
cases and convicting brokers and any broker convicted, the press is
invited at the judgement to carry out widespread publicity of the
judgement we have given in the past.

But a case readily comes to mind here.

Which one?

Peter Ololo.

Yes, Peter Ololo is
a broker, but he doesn’t have any illegal transaction as a broker. Did
you notice that when some firms were suspended, his firm was not
suspended? So what is the problem with that?

If he did other
businesses outside the market, that is outside the market and not
inside the market. And then, that is something that is already in the
law court.

In terms of the stock broking profession, we can’t do anything unless the court finds him guilty.

So you are waiting for that judgment?

We just have to. We
cannot try him twice. Supposing we try him and say he is guilty and the
court finds him not guilty or the court finds him guilty and we find
him not guilty? So, we cannot do anything.

That case is in the
public domain and not within our purview for now. When the court
decides and passes judgement, we just have to accept the judgement.

What are your expectations from the new CEO of the Nigerian Stock Exchange?

One good thing
about the new CEO is that he is a stockbroker and he has practised in
what I may call an advanced market. That is a plus for him, the
Exchange, and the stockbrokers.

We have had
opportunity to discuss and share our views with him. We believe he is
putting his plans together and when he is through, he will release his
agenda.

We will work with
him to build a better organised market. He believes he can bring in new
product and new ideas. We will work with him.

What do you foresee, going forward?

It depends on the
regulators. They are building a world class market and we want to see
how they build it and we want to encourage them to make sure they
define it, so that in the process, it will not kill or destroy the very
owners of the business.

Whatever the
regulators do, they must take the interest of the brokers into account.
Though operators, they are members of the Exchange and as long as their
interest is not taken into account in whatever the future of the growth
of the Exchange will be going forward, it will not work.

We are interested
in a better regulated environment, a market that has a human face. A
market that is considerate of not only the investors, but also the
operators.

What is the missing link?

I believe that over
the years, SEC has paid too much attention to regulatory issues. SEC
should begin to look at developmental issues.

The government that
is interested in employing people should begin to look at the capital
market sector. There was a window of opportunity given to textile,
agriculture, and entertainment industries. We believe the time is ripe
to have a window for stockbrokers.

That way, we
address the issue of liquidity in the market. Margin trading is
exciting because it brings liquidity into the market. The government,
through CBN, can open a window of say N200 billion that stockbrokers
can access on behalf of their customers who want to do margin trading.

The investor does
not have to go to the bank. All he has to do is go to his stockbroker,
do all the paper work, and gets the fund for margin trading with a
regulation that once it gets to a certain percentage, he puts in more
funds.

The scenario you have just painted points to the absence of market makers.

Margin trading is
not for market makers. Margin trading is done between an investor and
his broker, not the one the banks were doing. The banks were simply
giving loans.

Margin trading has
set guidelines. If you bring 30 per cent and the broker buys for you
one hundred, once the market depreciates the money you bring, you have
to bring in more funds because you are not supposed to be exposed to
more than 70 per cent.

If you can’t, they
sell the shares and take you out. We did not follow that. Margin
trading is one way we can bring liquidity back to the market.

Have you made this position to government?

We have raised it somehow. We have raised it with the minister and we are still canvassing it.

Quite frankly, do you think this market needs market makers?

This market, for it
to develop the way it should be, needs market makers. I agree. We have
always said it. But then, what are they going to make? They need funds
to do market making, and it is not just borrowed funds.

SEC has approved
some market makers but why are they not operational? Because it is a
business decision they have to take and if it is not worth the
business, why do you have to make it? Nobody can force you to be a
market maker.

See the full interview at 234next.com

Operators at the Nigerian Stock
Exchange (NSE) are optimistic that some of the successes recorded at
the just concluded elections in the country should restore investors’
confidence and further boost market performance.

Finance analysts at Vetiva Capital
Management Limited, a financial service company, said the market is
expected to perform better in the coming months, barring any negative
surprises on the political front, adding that “a post-election rally in
the equities market and increased portfolio flows from developed
markets” are expected as investors search for higher returns.

Market analysts also said that the outlook of the bond market will be positive in the coming months.

Rilwan Belo-Osagie, managing director
and chief executive officer of the First Securities Discount House
(FSDH) Group, said, “At the moment, bond yields are high because
interest rates are high. Maybe in the next two years the bond yield may
drop, but for most of this year I still see interest rate being high.”

Fragile confidence

Ese Onosode, chief executive officer of
FSDH Securities Limited, a stockbroking firm, said investors’
confidence in the market is still a little bit fragile, especially
retail investors within the system.

However, Mr Onosode said it will no longer take time for investors’ confidence to be restored.

“For now, what we are seeing in the
market is more foreign investors who are taking bold steps in
investment. But with time, we (operators) believe that by the time the
election results are fully out and there is a certainty as to stability
in our economy, even the retail investors’ confidence should pick up,”
he said.

He added that all international signals
from foreign investors give optimistic projection in the Nigerian
market, “therefore, what we are hoping now is that the confidence seen
internationally will filter down to local investors and make our market
a bit more buoyant.”

Speaking on the proposed
demutualisation of the NSE, Mr Onosode said, “We support the whole idea
of demutualisation, especially since it is some time that even the big
stock markets around the world already started.”

Demutualisation is transforming the Stock Exchange from being a self-regulatory organisation to a public company.

“For instance, the New York Stock
Exchange and London Stock Exchange are private entities. So the whole
process of privatising the Nigerian stock market is a good idea going
forward,” he further said. However, he said what stockbrokers expect is
a transparent process whereby all the major players involved are
carried along in the process “so that it doesn’t look like a process
whereby certain people corner the shares of the NSE when it becomes
privatised.”

Current market performance

At the close of trading activities last
Friday, the NSE market capitalisation of the 194 First-Tier equities
closed lower at N8 trillion from Thursday’s figures of N8.081 trillion,
reflecting N81 billion losses or one per cent decline.

The NSE All-Share Index last Friday
also declined by one per cent or 251.48 units to close at 25,041.68
basis points, from the previous day’s figures of 25,293.16 basis
points.

The NSE had recorded a total loss of
N449 billion in March, after recording significant losses of N260
billion in the preceding month.

In the mean time, while Emmanuel
Ikazoboh, the Exchange’s interim administrator, completed his term last
Friday, Oscar Onyema, the new CEO of the NSE, is expected to roll out
his full plans for the market to give investors a sense of what he has
to offer.

Mr Onyema, who resumed office on April
4th, had said that part of his agenda is to further boost foreign
participation in the market while he continues to woo indigenous
investors.

David Amaechi, an executive member of the Shareholders Association
of Nigeria, said Mr Onyema should make demutualisation of the NSE one
of his priorities, “to enable the market community own the Exchange so
that few hands don’t hijack the whole market.”

To discourage the use of raw cash in economic transactions in
the country, the Central Bank of Nigeria (CBN) has taken steps to promote the
use of electronic payment systems.

The CBN yesterday in a circular to all banks, Cash-in-Transit
(CIT) operating firms, payments system service providers, as well as money card
acquirers, issuers and processors, said that the new policies, including
payment of increased penalties for cash transactions by individual and
corporate bank account holders, are to help reduce the high usage of cash as
well as moderate the cost of cash management among operators in the country’s
financial system.

The CBN’s director, currency operations department, Muhammad
Nda, said in the circular that the increasing use of cash in transactions has
dire consequences on the overall economy, particularly concerning cost of cash
management to the banking industry, security, and money laundering.

To limit the negative impact on the economy, Mr Nda said the CBN
has directed all deposit money banks (DMBs) in the country to ensure that,
effective June 1 next year, daily cumulative free cash withdrawals and
lodgements by individual and corporate customers do not exceed a maximum
ceiling of N150,000 and N1 million respectively.

Cut down on cash
transactions

Consequently, he said the CBN has imposed a penalty of N100 per
N1000 on all individual cash transactions in excess of the limit, while
corporate customers that go contrary to the new policy are to pay a fee of N200
per N1000 withdrawn above the stipulated cumulative limit.

The circular added that, “Contravention of this policy shall
attract a fine of five (5) times the amount that the bank waives as a first
offender, while the bank shall, subsequently, pay ten (10) times the charges
waived.”

Though commercial banks are allowed to charge their customers at
least an interest of N5 per N1 million as cost of transaction (COT), there is
no approved rate stipulated by the CBN for overdrawn accounts, as the customers
are allowed at the discretion of their bankers.

With effect from June 1,this year, operators of card payment
schemes, processors, switching companies, service providers, and banks risk
being suspended for a month or licence revoked by the CBN, for not acquiring
approved operational agreements/contracts for local currency Point of Sale
(POS) card scheme.

“All financial institutions, including Deposit Money Banks (DMBs),
Savings and Loans, Mortgage and Microfinance Banks shall comply accordingly.
Compliance with the policy shall be monitored by the Banking Supervision
Department and the Other Financial Institutions Supervision Department with
appropriate sanction applied to erring institutions,” the CBN warned.

Similarly, in line with the new policy, third party cheques by
individual customers in excess of the N150,000 limit would no longer be
eligible for encashment over the counter, as the value for such cheques will be
required to go through the clearing house.

Besides, the CBN said where a bank allows a third party cheque
encashment in violation of the stipulated regulation, such a bank would be made
to pay higher than the sanctions between 10 per cent of the face value of the
cheque and N100,000 fine.

On cash-in-transit (CIT) lodgement services rendered to
merchant-customers, the CBN ordered its immediate stoppage, effective June 1,
2012, adding that customers interested in such services should engage the CBN
licenced CIT operators to aid cash movement to and from their banks at agreed
terms and conditions.

The new arrangement, which is to be operational initially in
some major cities, including Abuja, Lagos, Port Harcourt, Kano, and Aba,
attracts a fine of N1 million per specie movement for violators.

This step, many believe, would help curb incidents of violent
robberies which have become common because people move huge volume of cash
around.

However, there are concerns about the implementation of this new
policy, especially as it would mean transiting from a cash-based economy to a
near cashless one in just one month. A medical equipment supplier who gave his
name as Monday, said the policy would cause some distortion in the economy in
the short term.

“For instance, some of my customers always insist on cash
payment before they would release their goods. How do we make this change all
within one month,” he asked.

He said the CBN ought to have carried out sensistisation
programme to prepare Nigerians for the transition.

Currency outside the banking system is currently put at over
N1.025 trillion, as at February, according to the latest official figures
released by the Central Bank.

The figure stood at N927 billion as at December 2009, due
largely to skepticism about the efficiency of the Nigerian banking system.

The latest move is expected to reduce the amount of currency
outside the banking system.

Customers of First Bank and GTB yesterday had hard times
transacting business at the banks as their networks broke down. Normal services
were not resumed until after midday, leading to frayed tempers in the banking
halls across Lagos.

The banks have been showing signs of network challenges, either
technology migration induced or just service breakdown. Visits to branches of
the banks showed that the challenges faced by the banks before the long Easter
breakstill persisted, as both had their banking halls filled with aggrieved
customers.

Tough business day

The network challenges made it difficult for customers to
transact business. Mostly affected were those who wanted to withdraw money from
their accounts through the Automated Teller Machines (ATMs), as the banks
continued to accept deposits but could not post them immediately.

Funmi Adekoya, a customer said, “Last Thursday, I was here and
they officially announced to us that they were having network challenges; that
we should bear with them, because their services would be below expectation. I
initially thought it was because of the rush for withdrawals by customers
because of the long break ahead, but a week later, I am surprised that am
starring at even a worse situation.”

Some of the customers were so frustrated they refused to switch
off their phones while some picked their calls, despite caution from the bank
attendants.

“How do you expect me to switch off my phone? Do you know how
long I have been here? So I should not pick my calls? If you don’t want me to
pick my calls, then give me my money and let me go. It is only when you are
rendering your services efficiently that you can expect me to obey your rules,”
a customer told an official in anger.

First Bank, in some of its branches, could not carry out any
transactions for its customers till noon yesterday.

“The network was just restored a few minutes ago,” a bank
attendant at First Bank, Oba Akran branch, said, around 12.20 pm. “It has been
down since morning. We have not been able to make any payments or perform other
transactions,” she said, looking at the crowded hall.

According to her, there was no need heading for another branch.
“The truth is that it is everywhere; it’s affecting all our branches” she
added.

The bank’s hall was filled to capacity, despite the fact that
some customers were turning back, as soon as they sighted the queue. At the
GTBank, it was no different. At 12.30pm however, the banks had begun responding
to customers.

On Wednesday, GTB on Facebook apologised to its customers for
the downtime experienced with its challenges during the Easter holidays.

The bank had said, “We want to sincerely apologise for the
downtime experienced with our Internet Banking Service during the Easter holidays.
We recently migrated to our Superdome Servers, which will provide our e-Banking
Channels with a more robust, secure, stable & reliable platform.

“Over the next few days, you may notice some service disruptions
across certain branches and e-Banking Channels. This is also a result of
Internal Migrations and Platform Reboots. Please be rest assured that our other
e-Channels (ATM, Mobile & GTConnect) will continue to function throughout
this upgrade/ migration. Thank you for your understanding and know that we do
this because we want to serve you better,” the statement said.

The spokesperson for the First Bank, when contacted on phone,
said he was out of Lagos and could not speak on the problem.

Service breakdowns are not totally avoidable. It is not known
when the banks service breakdown would be fully addressed, but customers say
banks should devise a more effective way to address their internal challenges,
without having to put their customers through such extreme discomfort.

One of the several strategies adopted by companies to entrench
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The ultimate goal was to enable the subscribers experience the
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