It is an established fact that real estate is highly lucrative and profitable. Yet so many people run away from it due to some disastrous experience they had or heard of. The investment may be too huge to lose. That is why it is important to be fully updated on what you are getting into. Knowing the nitty-gritty before delving into it is a nice idea. Realtors are making several millions daily, some make billions in a single deal. As a result of the success stories of experienced realtors, many just attempt real estate investments without knowing precisely what they are getting into. There will always be opportunity in real estate investments, hence there is no justification for rushing into it without having adequate details of what you are investing in.

Like many other businesses, best practice is to start with what you have. Your extra cash or savings from your income is enough for your first investment. Securing loan for your first real estate investment is not a good idea at all. Hence, start with what you have. If you have taken that in, it is time to know the different areas of real estate you can invest in as a beginner.

  • Real estate agency: This is one of the simplest areas you can establish your business in real estate. It can help you garner a lot of relevant experiences. All you need is to identify properties available for sale or lease, reach an agreement with the owner to transact on his behalf, agree on the commission to be paid and advertise among your network circles. It is easier for you as a professional because your colleagues will find it easier and comfortable to turn to you than an outsider whenever they are in need of any of your listed properties or similar ones. This particular business does not necessarily need you to have any start-up capital.
  • House or Office rent: How this work is simple. Build a house or office complex, and let it out. You continue to earn your income as long as the property remains yours. You may decide to hand it over to an agent to manage for you or you may manage it yourself but you are sure to receive a monthly or annual income on it. The size of investment is dependent on the amount available.
  • Land Flipping: This refers to buying of land and reselling it in a short while after purchase for profit making. This requires market access and strategy. If you are able to identify a ready market, buy a piece of land according to the capacity of your financial resources, then sell it off in the short period afterwards, and go ahead to buy another. Re-investing your capital and gains, you will sooner than later be able to transact large estate business that will run into hundreds of millions. What is required of you in land flipping is access to buyers, knowledge of the area and landowners, confirmation of authenticity of ownership and a smart strategy of reaching buyers. You are on your way to becoming a billionaire.
  • Open space leasing: this is just taking extra initiative on putting your property to work while you wait for it to appreciate. How do you do that? Purchase a land in a good location and lease it out for temporary use pending the period the land appreciates. You earn while you wait and when the time is ripe to sell, you sell at a very good price. Hence you earn double.
  • Property development: This is the most elaborate investment plan in real estate. It requires more finances than any other plan. Investors in property development most times pool resources together from a team of investors or even go ahead to secure loan from financial institutions to achieve their goals. They identify the ideal location to site luxury apartments or commercial real estates that they sell with very high profit margin. It requires the highest financial commitment and usually produces the highest returns.

Understanding which option best suits you is the right place to start. It is also advised that you start from the simple options and systematically graduate to the complex options. Experience is a very valuable requirement when it comes to real estate business. Luckily enough, such experience can be obtained with little investment.

As we know that if there is a viable business idea, the next thing will be to appraise the available financial and human resources. Upon appraisal, the next step will be to augment any observed deficit appropriately and adequately.

A very viable business idea is consultancy. Most people think they need an elaborate system and facility to start a consulting firm. Not at all. The most important thing you need is experience in the particular field you chose to consult in. Even if you have limited experience, you should preferably build a team of highly experienced individuals, who are also motivated to drive your vision. Consulting is highly synonymous to experience sharing. Lots of young risk takers do it.

A consultant is one who consults for people and other businesses. He shares his experience in that field with the clients and also advises the clients on best practices. Consulting can be done in all industries and for almost every sector and activity in the business world. Talk of corporate infrastructure, logistics, IT projects, PR projects, furniture, planning, record management, marketing and business performance. Therefore, no matter what your field or area of expertise is, you can become a consultant in that field. Your competitive edge is very outspoken. Your experience and your network. You must have built a strong network of people who need your services and who know that you are quite skillful and experienced in that particular field. Except you did not have your employment experience on earth. That is where to start.

Consulting is a business that you can always conduct at your home office. You can telecommute. Hence, start-up is always low budget for anyone that wants to do it as an additional source of income. In fact, your office can be your digital gadgets such as smart phone, laptop computer or tablets. In such instance, all you need is constant internet connection, a strong social media presence for marketing and communication purposes and a developed interpersonal communications skills which you must have developed strongly in the course of your employment. A consultant is also a person with integrity. You must be able to keep your clients information confidential and at the same time honor your agreement at all time.

Now that you know that there is an ever-growing market for consultants, you also need to know if you are cut for the job before jumping into it. Hence, you need to assess yourself in the following areas:

Expertise: You need to evaluate your expertise in the chosen sector in which you want to establish your consulting activities. You need to be clear on why your clients will hire you. It is either you are highly experienced in that field or you intend to be trained in that field. You should be able to comfortably anticipate your clients’ questions, and answer them excellently. You should have knowledge of recent trends in that field so as to be able to offer updated services in line with trending best pratices.

Skills: Knowing the skills you have that will give you an edge above other consultants is very important. Some people are not comfortable with talking for long, if you are in that category, maybe you should consider another option. Or you are highly irritable by complaints. The reason clients will approach you in the first instance is because they have some problems they need you to solve. They might present their problems as complaints or whichever way, you need to be a good communicator, as a matter of fact, an empathic communicator to succeed in consulting. Your skills should determine where your consulting will focus on. Your skills could be writing skills, organization management skills, IT skills, financial management and so on. Expertise alone is not sufficient.

Certification: Certain businesses and profession require licensing to operate while some do not. You need to be sure if you need certification or licensing to operate in that field, know what the certification is and what it entails and go for it immediately. It is always advisable to do the right thing at the right time. You may be afraid of the requirement for certification. You need not be. Usually, education and experience are the most important criteria for obtaining most certification. Being licensed means you can always operate by standard of bigger companies and charge similar rates. In fact, it is another way of boosting your firm’s image.

Personality: Finally, you need to be sure of your personality, if you are the man for the job. You may not be a successful consultant as an introvert because you will meet new people continuously. You need to be able to socialize with clients and make new friends fast so as to earn trust and build your network. You also need to be independent, objective and creative.

With all these in place. We shall be talking about how to set up your consulting business as an experienced professional.

A few years ago, an Aunt of mine retired after 25 years in her banking organization. She had gotten a generous gratuity, which she used to start a shopping centre. Although she couldn’t get access to her pension scheme yet because she was below 50 years of age, she already had a well-thought out retirement strategy and was also able to maintain a lifestyle similar to the one she had before retirement. When I asked about her strategy; she educated me on having a Retirement Savings Account (RSA), ensure that your employer makes a contribution of 7.5% of your total income to your RSA, and have an investment plan.

For a young career minded individual between the ages of 22-35, thoughts about retirement are a back burner. There are a lot more pressing issues like; promotions, contracts, loans, marriage, children, building projects and car payments, etc. It should be in your best interest to consider long term concerns such as your own retirement plans. Regardless of whether you’re 10, 15, or possibly 30 years away from retirement, being on the right side of things is the best place to be.

Some common concerns, retirees are usually worried about are:

  • Longevity: Most retirees usually outlive their retirement payment checks/savings. This occurs when the pension scheme has an age clause of 10-20 years payment schedule.
  • Health: Some retirees face health challenges that usually come with old age. Access to medical care and health insurance providers will come in handy as they grow older.
  • Income: Retirees especially those with previous experience in the corporate world, require a monthly income equivalent to salaries that could help out in monthly expenses.

The Federal Government of Nigeria in 2004 put in place a pension system known as The Pension Reform Act 2004 that would address the issue of pension administration.

This gave rise to what is now known as Contributory Pension Scheme (CPS), instead of the then Defined Benefits Scheme (DBS). The scheme provides for retirement saving options geared at putting a retiree on monthly income even after he or she must have retired from active service.

There is a common assumption that savings, in addition to pension scheme and a less expensive lifestyle  will all add up to financial security at old age. For some, this may turn out to be true, but such success stories occur as a result of good luck and rare on most occasions. Don’t get me wrong, I’m not recommending that you don’t save at all, as a matter of fact; putting away a percentage of your income every month from now until you retire, can do away with financial anxieties many retirees face. But there are also other forms of investing money and making it work for you.

Having a retirement strategy is a sure guaranty of stability and economic independence in your later years.

You can adopt these effective investment plans for your retirement, below:

1. Programmed Withdrawal: The Programmed Withdrawal (PW) is a retirement product offered by the Pension Fund Administrators (PFA) for periodic payments (monthly/ quarterly) to a retiree. The Retirement Savings Account balance is spread over the expected life span of the retiree but an initial lump sum can be collected while the remaining funds in the account are managed by the Pension Fund Administrator. Under this model, the monthly pension is at least 50% of the last monthly income. Programmed monthly or quarterly withdrawals are calculated on the basis of an expected life span, in other words, Programmed Withdrawal provides a retiree with guaranteed income for a period between 10-15 years and after this tenor, he ceases to earn further income from his PFA. Within this period if death occurs; the balance in the PW is transferred to a named beneficiary under a will or letter of administration. A retiree on Programmed Withdrawal with a PFA can move to another PFA and can also change to annuity with an insurance company. The Return on Investment (ROI) on any money market instrument purchased by the PFA’s belongs to the retiree in his RSA.

2. Annuity: This is a contract agreement between an annuitant (Policyholder) and an insurance company (licensed by NAICOM), whereby the Annuitant deposits a lump sum to the insurance company which ensures a fixed sum is paid to him by the insurance company at an agreed time interval e.g. Monthly, Quarterly, Half Yearly or Yearly for a tenor of 10 years, although payments could continue for the rest of the annuitant’s life. However, this payment ceases upon the unfortunate death of the annuitant, therefore it is not eligible for inheritance, but in the event that the annuitant dies before the guaranteed tenor elapses the beneficiaries will only be paid for the remaining period of the agreed years or in a lump sum. Annuities are appropriate financial products for individuals seeking stable, guaranteed retirement income. Annuitants never outlive their income stream, which edges its longevity risk over Programmed Withdrawal. The annuitant can only move to another insurance company after two years but cannot switch to Programmed Withdrawal with a Pension Fund Administrator.

3. Money Market Instruments: These instruments include but not limited mutual funds, bonds, equities, shares, stocks, etc, that are traded in the capital markets. Capital markets create a channel between you (the investor) and the end user which could range from businesses, private individuals and the government. These investments mature over time, with dividends paid into your bank account or reinvested by your capital asset managers. This industry is overseen by the Securities and Exchange Commission of Nigeria.

4. Real Estate: The National bureau of statistics reports that in the first quarter of 2016, real estate services sector contributed to 6.46% of the Nigeria’s GDP. Due to the large housing demand, the market is rosy, and ripe for the picking. With the average rental price for a two bedroom apartment edging towards N500,000 in large cities like Lagos and N250,000 in smaller towns, and cities, A supply gap of affordable housing units can create significant investment opportunities.

In conclusion, if you intend to consider these options for your retirement plan, please research them thoroughly, and commit to a good company/provider before deciding whether it’s an appropriate investment for someone in their situation.

There’s never a right time to start planning for retirement; it will be unwise to not have a pension plan for old age!

You must retire in style!

is a fluid concept because it connotes different things and it offers different experiences for different people. While some individuals feel it’s something that would be worried about at a much later time, others view it positively and anticipate it with all wistfulness and some others dread it with great anxiety. Thus, it could be said that it is not a homogenous experience for everyone, but being as it may, someday in the life of every worker, he would be facing the reality of retiring days and the only underlining factor that determines retirement days, is the conduct of a person’s present lifestyle.
With the extravagant lifestyle of workers in civil service across the nation, it seems that only very few number of workers think about their positions some 30 or 40 years from now. It’s a concept so many assume to be so distant and as much as possible; would prefer to avoid the subject entirely. This avoidance could stem from a lot of factors which include fear of the unknown because growing old is a grey issue and the fact that nobody wants to grow old. Women deny their age, and so do men. For those who value their youthfulness and still hold on in the hope of discovering the fountain of youth in beauty products, surgery, natural remedies to avert physical ageing, retirement and the senior life would really be a frightening proposition, some would resort to colouring the grey hair, use skin tightening procedures to maintain young-looking skin, and other countless procedures.
Retirement is a time of significant transition as far as the use of time is concerned. However, it’s importance is made more glaring by the fact that the retired person is made to face some challenges because of his/her new status (as a retired person), hence one’s present lifestyle has a long way of affecting retirement days. It has been noted that retirement is a stressful experience for many because of its associated decision change in the matter of life arrangement generally. And most times, the moment retirement comes knocking on the door of a worker, it enters with challenges and expectations.
It is typically associated with stress for the average civil servant in Nigeria as retirement in Nigerian civil service is guided by Decree 102 of 1979 which deals with pensions and gratuity. The statutory age of retirement of public officers is 60 years while it is 65 years for judicial officers and 70 for academic staff of universities. However, with the reform of the civil service decree, No. 43 of 1988 retirement age has been put at 60 years or 35years in service whichever comes first. It must be stated here that irrespective of the type of retirement, the transition is associated with some stress situations like economic, social, psychological and occupational stress. These stress could emanate from different sources which include money, health, aging, search for a meaningful activity, caring for other family members, e.g. grandchildren or elderly parents, relocation amongst others.
Hence it presents a worse situation when the retiree is not adequately prepared to face this ultimate phase of life. Retirement life demands great managerial ability, and this would be best achieved with early preparation, it wouldn’t be too early to begin as soon as one gains his/her first employment. It has been observed that the retiree in order to experience a pleasant post-retirement lifestyle would have to device effective means of managing some challenges inherent in retirement as he will soon be confronted with the challenge of managing insufficient retirement benefits that come at the end of the month to cater for his needs especially if he still requires to securing residential accommodation, the challenge of a new and low social status; difficult health and declining health condition.
Planning for retirement is a necessary and important part of everyone’s financial plan as making positive plans at an earlier life with little savings reserved purposely for retirement, the better off since to live a comfortable life after retirement demands little sacrifice all along working days. Adequate financial preparation for retirement thereby would ease incidence of retirement adjustment failure. Also, there is an innate need for every worker to adopt a meaningful lifestyle that would not affect the future years of retirement because trying to adjust to low social status will pose a more difficult problem
Therefore, retirement planning should reflect every individual’s dreams, hopes, and aspirations in addition to meeting day to day obligations. It is essential that all prospective retirees should begin with a personal goal setting exercise that reflects how the individual wants to spend the last days of his/her life. Besides the financial preparation, one’s family style can equally affect retirement days, as loneliness is a major fear, but people who recognized the importance of good moral upbringing and have reared their children well, taught them the right values of respect such as caring for the elderly, love for parents, etc. would be most likely cared for by their descendants until their last days, as they would not be abandoned to lonely lives.
Hence to avoid the independence and physical challenges associated with seniority, individuals should ensure that in all life expense, they should consider the future financial freedom and independence, the challenge of living alone, retirement home, medication, health, and others. So the best option is for everyone, irrespective of income, to plan ahead by investing properly. Get creative in planning for retirement by collecting things for the sole purpose of selling them at a high return for extra money upon retirement.
Cut down on huge cost and avoid living an extravagant life that leads to squandering income as it comes. It would be great to have some positive influence on the life’s ultimate destination. This is why, despite the not so nice picture usually associated with old age, retirement, seniority, and related issues, the need for adequate concern for some 30-40 years ahead is indispensable.

Most workers, supposedly, hope that their retirement benefits will keep them going when they exit their workplaces but this is hardly the reality, pensioners revelations have confirmed.

Speaking to the Daily Trust, the National President of the Federal Universities Pensioners Association (FUPA), Dr Ayuba Audu Kura, said most of his contemporaries have failed to plan ahead of their retirement.

“We failed to think of what to do when we are not working and some of us are paying for that mistake now,” Kura said.

He said though he now engages in several businesses to augment his meager pension, he would have been better off if he had planned for his retirement.

“Many of us, when we were working, we never knew there will be a day when the rain will come. I told my children that I have been ‘a good-morning-sir somebody’ but I don’t want my children to continue to be ‘a yes-sir boy’ as we were when we’re working.”

Daily Trust’s investigation shows that most retirees receive less than N10,000 as pension monthly, which is less than the current minimum wage in the country.

The Chairman of the Nigeria Union of Pensioners (NUP) in Abia State, Comrade Chukwuma Udensi, laments that the state’s N1, 200 minimum amount of pension is the least in Nigeria.

Similarly, Plateau State Government last reviewed its minimum monthly pension of N2, 000 to ten years ago, reviewing the amount upward to N5, 140.

With the nation’s level of inflation, workers have no option than to plan for their retirement in order to have alternative sources of income.

“I engage in so many businesses, sometimes, I don’t so much look at the pension,” Kura Said.

A retired teacher, Mr Joshua Ochendo, told Daily Trust that most of what he does now as a retiree, he initiated them after retirement.

Ochendo, who now runs a non-governmental organization (NGO), said as a teacher in Anambra State, he did not plan for his retirement until he found himself out of employment and discovered he was not yet tired.

“I retired from work but I was not tired,” he said. “When I realized that, I started looking for what to do.”

“I was used to getting up and going to work. All of a sudden, I found myself at home every day. All my children are all grown up and there is no one at home to talk to. I told myself that if I don’t start doing something fast, I may start hallucinating.”

He founded his NGO to earn money and contribute to the society’s development.

He advised workers to consider current happenings in states where workers and pensioners are owed salaries, for months, as a pointer to the fact that if they do not plan for their retirement they would live to regret it later.

Since last year, states have been battling to pay workers salary and pension, a development that forced pensioners to stage several demonstrations to protest non-payment of their entitlements.

Between last year and this year, pensioners have staged a protest in Delta, Bayelsa, Plateau, Abia Osun, and Ekiti states to press home their demands.

In an exclusive interview with Daily Trust, the Head of Regulatory and Public Sector (North) of AIICO Pension Managers Limited, Mr. Sani Mustapha, said he met workers who lived in quarters provided them by their workplace, all their working years, who did not plan for where to relocate after retirement.

Mustapha said workers need to attend retirement planning workshops to learn how they can plan for their retirement.

Pension experts advise that if a worker’s retirement savings are broadly on track, the worker can still take steps to improve his sources of income at retirement.

After taking steps to improve your pension pot, Mustapha advised that workers can develop themselves academically to venture into consultancy after retirement.

He said: “If workers develop themselves before retirement by adding to themselves more academic value, I’m sure after they retire, they can still be useful and people will still look out for them for their services.”

He called on the government to desist from engaging international consultants to solve simple problems that local retirees, with an immense wealth of experience, can solve.