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The Scheme at a glance

 

The University of Nairobi Pension Scheme 2007 is a ‘Defined Contribution’ Scheme.

 

 

(i)        How does the Scheme work?

 

Every month a member contributes 10% percentage of their Pensionable (Basic) Salary into the Scheme. Over the period until retirement (or until a member leaves the Scheme if earlier), contributions, along with contributions paid by the Employer on behalf that are allocated to their retirement savings, are invested in the Member Account at the Pension Scheme. 

 

The member account is invested by the Trustees and will grow broadly in line with the returns achieved each year on the investments. The value of the Member Account can go down as well as up.

 

At retirement the value of the Member Account will be used to provide the member with an optional cash lump sum together with a pension.

The amount of the benefits at retirement will depend upon four basic factors:

 

  • The level of contributions a member makes to the Scheme.
  • The contributions that the Employer makes on behalf of the member.
  • The investment returns credited to the Member Account.
  • The prevailing annuity rates payable by insurance companies at the time of retirement.