Back in school, we were required to select Literature as one of the subjects whose exams we would sit for at the Ordinary Levels (O’ Level). Reading had been a part of me from much earlier and I didn’t have a problem with English. However, Literature was something else. In the beginning, it appeared to be boring. Lots of reading of long poems written by famous English poets, like George Gordon Byron.
Lord Byron was one of the leading figures of the Romantic movement. He is regarded as one of the greatest English poets. He was renowned for his personal beauty, his athleticism, a lame club foot, a great love for animals and strange eating regimes. He was also famous for some rather notorious reasons: his sexual escapades and scandals.
Enough of the man himself. A bit more of his work, his poetry. A notable work written in 1816, The Prisoner of Chillon, chronicles the imprisonment of a Genevois monk, François Bonivard, from 1532 to 1536. The poem describes the afflictions of a lone survivor of a family who have been martyred. It is the opening words of this poem that has remained with me for all these years:
“My hair is grey, but not with years,
Nor grew it white
In a single night,
As men’s have grown from sudden fears:
My limbs are bow’d, though not with toil,
But rusted with a vile repose,
For they have been a dungeon’s spoil,
And mine has been the fate of those
To whom the goodly earth and air
Are bann’d, and barr’d—forbidden fare;”
Here is my point. Grey hair is associated with age- years on earth. The greyer the hair one has, the older the person is, usually. Some few people acquire grey hair on their heads at an early age, even before they turned ten. That’s plainly a matter of genes. Most of us acquire grey with age and stress. A cursory examination of the pictures of most presidents will show their ‘freshness’ at the start of the office terms and the weary look of a weather-beaten sailor’s face at the end of their terms. So yes, stress produces gray hair. Their hairs become grey but not with years. The ‘prisoners of Chillon’- like the popular phrase: ‘stress nkoaa!’
Beyond the Stress and Grey
For each of us, in a determinate number of years, we shall enter into the era of retirement, if death does not take us before then. There’s very little we can do about altering this. It shall most certainly and naturally occur. However, there’s so much we can do to prepare for that time.
We may have spent so many years receiving an income each month from our employers that we may have forgotten how it is like to have no regular income to support ourselves and our dependents. For some of us, it only takes casting our minds back to secondary school or university days, when we had not begun formal work, yet had commitments and no benefactors. Retirement without a pension would be just like that. There would be medical bills, utility bills, feeding costs and transportation costs to keep us going. There are also social costs, like funeral donations, contributions to a cause and so many others to make all the time. How would we keep up with these? That is the question.
Without doubt, some people have relations they will depend on. It may be offspring, siblings, close relations or friends. It is not so pleasant to be dependent on the most well-meaning of people, especially for money. We would all rather have people to help us with things we ourselves would pay for because there is comfort in being financially self-reliant. As we OctaneDC tag line has it: …Wealth creation and financial independence. That’s is crucial because self-worth is important to us all. And with a steady inflow of income, our retirement years would be less stressful. Most of our expenses would be covered by our own income from pension or other sources.
The Question: How?
How then, do we prepare for a more financially self-reliant retirement. How do we avoid the prisoner of Chillon greys hairs?
A pension plan is very critical for us all, for these reasons. Firstly, we have a limited number of working years to use to prepare for pension. With each passing year, it dwindles and we approach retirement. As the Chinese proverb says, “The best time to plant a tree was twenty years ago. The second-best time is now.” Now. Right now!
When Rose turned forty-four years, she began to think seriously about life in retirement. She had consistently worked since she had been twenty-six, the only two-year break being when she had gone overseas to study for her master’s degree on a scholarship. That meant sixteen years of work, sixteen years of contributing to the national pension scheme. Also, since the inception of the three-tier pension regime, she had contributed to her tier-two scheme for five years.
Aside that, Rose really had nothing set aside for her retirement and it made her worry. She estimated that the monthly pension payment that she would receive from SSNIT (Tier One) would be about a third of her current salary. Definitely, that would make her a pauper in no time. She could invest her lump-sum payment from her Tier Two scheme when she received it. That would potentially earn her an additional fifteen per cent of the salary. Combined, she would be receiving almost half of her current salary in retirement (Which she complains is not enough, anyway). Still not enough because she estimated that, at the barest minimum, she would need seventy-five to eighty per cent of her current salary to get by each month, barring any unforeseen expenses.
First action. Rose spoke with her investment adviser. She was going to have to make several adjustments to her spending. Major adjustment: no more embarking on trips abroad (unless her husband was paying!) till she had a solid plan towards retirement in plan. Any savings she made towards that would now be channeled into an investment plan towards retirement. If she worked on this really hard, her estimates showed she could maintain her income level even in retirement.
K-Dua, a spare parts dealer at Abossey Okai, rummaged through the new stock of parts that had just been off-loaded in front of his shop. In good times, he made a tidy sum and his earnings would compare well with his brother’s who worked at a bank.
He had done this for the past fifteen years and had built a home for his family at Kasoa. His children seemed uninterested in his work, except the youngest. Earnings supported his whole family but he wondered for how long he would be able to work and if at that point his youngest child would be able to run the business well enough to ensure continued earnings. That was going to be imperative.
The owner of the shop next to his told him he had noticed grey streaks in K Dua’s hair. He had been pondering a lot lately, about retirement (You remember stress and grey?). K-Dua began to evaluate his finances. He required a pension plan, one he could sustain. If every week, he set aside a certain sum, he could build up an investment which would release cash in retirement whenever he needed some. His investment adviser helped him set up a pension-type investment and another for more immediate expenses.
He did not have to be too frugal in his spending. He just needed to be careful, more purposeful, more intentional and planned. He reasoned that, after fifteen to twenty years of consistency, he would have built a reasonably good retirement investment and would not suffer, even if the parts business was not doing so well. Maybe, just maybe, even his ‘prisoner of Chillon’ greys would become black again.
Too Early or Too Late?
Perhaps, the ones with the best chance to start a retirement plan are those in senior high school or a tertiary school, or at least sixteen years. The ones who may feel they are too late are those fifty-five and above. It is never too early to have an investment towards retirement for ourselves. Adulthood (threshold of eighteen years) should trigger a plan. True, most of us missed that and some may be fifty-eight, say, currently. Better to have a plan for what income we are making and what lump-sum payment we would receive in a few years’ time than to fold our arms or thrown up our hands in despair.
Retirement beckons (not to say ‘looms’). Let us have a few greys if it is from stretching ourselves a bit to reap later in retirement. We should not resign ourselves to our fate, like the prisoner in Lord Byron’s poem:
“In quiet we had learn’d to dwell;
My very chains and I grew friends”
For us, we shall say finally:
“So much a long communion tends
To make us what we are:—even I
Regain’d my freedom with a sigh.
Our retirement planners and investment advisers will help us navigate these troubled waters to get to still waters and green pastures in retirement. Talk to yours today and let them help you.
About the Author
Through his writings Kwadwo has discovered his love and knack to simplify complex theories spicing them with everyday life experiences for the benefit of all. The Head of OctaneDC Research, Kwadwo Acheampong, has over a decade experience in fund management and administration, portfolio management, management consulting, operations management and process improvement. Feel free to send him your feedback on his article. Email: [email protected]