July.7.16Retirement Planning
Money Matters with Nimi

Many families consist of not only the nuclear family, which is made up of parents and their children, but of the extended family, which embraces several generations of people who are related by blood, marriage, or adoption. In Nigeria, for example, the family is the very foundation of a nations social fabric and includes siblings, grandparents, aunts, uncles, cousins, and even more distant relatives.

The unwritten rule

The extended family system (EFS) has evolved into a homegrown version of a more formal welfare system. Traditionally, the elderly have been revered and adored and after all their sacrifice they do deserve rest and comfort in old age. Care of the elderly in our midst is culturally rooted and is part of a nation’s core values. It has indeed become a shining example of a form of social security within communities.

Through this basic economic unit, family members – typically adult children – are usually charged with the responsibility for the provision of informal care and support for the elderly. Such care and support is generally voluntary and reciprocal and seen as a duty that has been assumed and embraced and that comes without any form of formal compensation.

The unwritten rule is that ones’ children will play an important role in providing economic security and care for aged parents, and in turn, these parents once they become old, should be able to rely on their children.

The changing structure of the family

More recently, there has been a gradual but noticeable shift away from the traditional family towards the nuclear family at the expense of the wider family network and particularly of the elderly, for whom this social phenomenon has served as a form of insurance. It was the traditional economic safety net for old age.

The traditional role of families in caring for their elderly is gradually diminishing due to economic realities that have hindered the willingness and indeed the ability for family members to give. That sense of duty is being overtaken by the daily challenges that family members face in taking care of their own most basic needs. Rural-urban migration, modernization, and influences from foreign cultures are also leading to the gradual disintegration of our communal sense of living. According to a study by sociologists, the past ten years have seen a 70 percent increase in Indian households with nuclear families; this community, like African communities, has traditionally maintained a communal existence.

Rural-urban migration

With more than half of the world’s population moving towards towns and cities, there is a trend towards urbanization. Advances in careers often require mobility, which usually means migrating from family in search of employment. The elderly thus remain in their hometowns without adequate care and attention.

Homes for the elderly

Whilst the concept of senior citizen’s homes seems almost alien in African culture, such practical steps must be encouraged where there is no alternative and families are unable to provide even the most basic care for their elderly. Currently there are very few homes that provide for the destitute elderly or those without family or savings or for those too frail to work.

Ageing as a policy issue

With the lack of a formal comprehensive and effective social security system, and with fledgling pensions and healthcare insurance market schemes in many developing countries, the diminishing role of families involved in care for the elderly leaves a huge void. There is thus an urgent need to refocus on the issues of ageing in Africa and elsewhere. Ageing has become a global phenomenon and indeed a critical policy issue with serious implications. With shifts from the traditional issues of high mortality and high fertility, to reduced fertility and greater longevity, developing countries face an aging crisis.

The private sector should also begin to direct its philanthropy to include provision for the elderly. Non-governmental organizations and religious organizations such as the Senior Citizens Care Foundation, the African Gerontological Society, (AGES), and the Catholic Church, among others, have made laudable efforts in providing assistance to older people through daycare centers, residential homes, and regular medical check-up’s.

Planning for your old age

In today’s world is it unrealistic to assume that your adult children will take care of you when you are old? What makes the best sense is to start planning early to make provision for that phase of your life after active retirement, so that you are prepared for it whether or not they are able to provide the required support. Without adequate planning for retirement, with family resources stretched to the limit, and confronted by increasingly expensive healthcare, many people could face a grim old age.

Financial security is a factor in successful aging and will help the elderly maintain dignity, independence, and autonomy beyond the active retirement years. The main contribution made by a balanced portfolio consisting of shares, bonds, cash, and real estate, is in providing access to a decent standard of living and in being able to afford long-term healthcare where it is not readily available within the family.

Nowadays, there appears to be a dwindling regard for our elderly. A nation in which the elderly are neglected and even abandoned is reprehensible. It is thus important for all of us to take individual responsibility looking after and protecting the elderly in our midst.

Until an organized and effective welfare and social security system is in place, it is expected that the extended family system will continue to play a crucial role in the social welfare of its members. At the same time, it is clear that as cultural values, socioeconomic conditions, and technology continue to evolve so too will the face and structure of the extended family in our contemporary society. In whatever form it takes, it is our responsibility to protect it.

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