Last Sun­day af­ter­noon, I was sit­ting at a ta­ble just out­side the restau­rant at the far end of the Pi­geon Point Her­itage Park in To­ba­go, when I was ap­proached by a man who asked me if I was Wil­son. I said I was and asked him his name, which he gave me. He in­di­cat­ed that he is a re­tired pub­lic ser­vant, who knew my name from read­ing this col­umn. He told me he had re­ceived his lump sum for his years of ser­vice and al­so gets a month­ly pen­sion, which he said did not go far enough be­cause the cost of liv­ing was ris­ing, but his pen­sion was not.

His state­ment that his pen­sion does not go far enough res­onat­ed with me be­cause I turned 60 last year and had an ex­pec­ta­tion that my Na­tion­al In­sur­ance and oc­cu­pa­tion­al pen­sions—from my 35 years of em­ploy­ment as a jour­nal­ist—would have been more. And had I stayed at Guardian Me­dia, which has (or had) a de­fined ben­e­fit pen­sion plan, for all of my ca­reer, it would have been more. For­tu­nate­ly for me, I got bit­ten by the in­vest­ment bug when I was 18 and have re­mained a con­sis­tent in­vestor for all of my life.

But I would haz­ard a guess that most of the T&T pop­u­la­tion aged over 60—which the 2025 Re­view of the Econ­o­my es­ti­mates at 182,989, amount­ing to 13.37 per cent of the coun­try’s to­tal pop­u­la­tion—is strug­gling to “make ends meet,” as they are faced with ris­ing cost of liv­ing and in­creased health­care ex­pens­es that ac­com­pa­ny the ag­ing process.

The de­mo­graph­ic fact that the pop­u­la­tion of T&T is get­ting old­er—as peo­ple live longer, fam­i­lies have few­er chil­dren and more of us mi­grate—means the num­ber of na­tion­als over 60 is on­ly go­ing to in­crease.

This has im­pli­ca­tions for the re­tire­ment pen­sions de­liv­ered on a month­ly ba­sis to thou­sands of peo­ple by the Na­tion­al In­sur­ance Board of Trinidad and To­ba­go (NIB).

In lay­ing the au­dit­ed fi­nan­cial state­ments and the re­port on the op­er­a­tions of the NIB for the fi­nan­cial year end­ed June 30, 2025 in Par­lia­ment on Feb­ru­ary 27, Min­is­ter of Fi­nance, Dav­en­dranath Tan­coo, made the im­por­tant point that the pre­vi­ous ad­min­is­tra­tion’s fail­ure to re­form the Na­tion­al In­sur­ance Fund led to a widen­ing of the deficit be­tween con­tri­bu­tions to the Fund and pay­ments of ben­e­fits by it.

“Dur­ing the 2025 fi­nan­cial year, the num­ber of con­trib­u­tors de­clined by 3.0 per cent to 473,707 while the num­ber of ben­e­fi­cia­ries in­creased by 1.8 per cent to 230,722. The num­ber of long-term ben­e­fi­cia­ries in­creased by 2.2 per cent in 2025. Pay­ment to this group to­talled 96.1 per cent of the to­tal ben­e­fit ex­pen­di­ture record­ed in 2025.

“What does this mean? Few­er con­trib­u­tors. More re­tirees. Longer life ex­pectan­cy. These are ac­tu­ar­i­al re­al­i­ties. And they do not dis­ap­pear be­cause a gov­ern­ment choos­es in­ac­tion,” said Mr Tan­coo.

He said for its 2025 fi­nan­cial year, the NIB re­ceived con­tri­bu­tion in­come of $5.o bil­lion and its ben­e­fit ex­pen­di­ture amount­ed to $6.62 bil­lion. As a re­sult of that deficit, a to­tal of $1.9 bil­lion was with­drawn from the Na­tion­al In­sur­ance Fund to fund the dif­fer­ence be­tween its in­come and ex­pen­di­ture and al­so the op­er­a­tions of the NIB.

As a re­sult of the $1.9 bil­lion with­draw­al, the to­tal Fund bal­ance de­clined from $28.09 bil­lion in 2024 to $27.36 bil­lion by June 30, 2025.

“Con­tin­ued deficits at that tra­jec­to­ry would have placed the Na­tion­al In­sur­ance Fund on a path to­wards even­tu­al ex­haus­tion with­in the next six to sev­en years or by 2033 to 2034. What would that mean? It means that our el­der­ly would not have been able to ac­cess pen­sion pay­ments- cit­i­zens would not be able to get med­ical ben­e­fits such as fi­nan­cial grants (sic). That is what the PNM closed their eyes to,” said Tan­coo.

The cur­rent ad­min­is­tra­tion has made many mis­takes in its over 10 months in of­fice, but its ac­tions in re­form­ing the Na­tion­al In­sur­ance Sys­tem—by in­creas­ing con­tri­bu­tion rates and grad­u­al­ly push­ing back the age at which peo­ple qual­i­fy for a NIS pen­sion of at least $3,000 a month—are de­serv­ing of na­tion­al con­grat­u­la­tions.

Where does that leave re­tirees?

For peo­ple who are think­ing about fund­ing their re­tire­ments, one ar­ti­cle has been quite in­flu­en­tial. It was the first in a two-part se­ries from Bourse Se­cu­ri­ties, pub­lished on Ju­ly 28, 2025 in the T&T Guardian. The piece was head­lined ‘Con­ser­v­a­tive in­vest­ing right for you?’ and it analysed in­vest­ments through the lens of risk tol­er­ance.

The ar­ti­cle made the point that the con­ser­v­a­tive in­vestor tends to dis­play the fol­low­ing traits:

• Risk aver­sion. Con­ser­v­a­tive in­vestors seek lit­tle to no volatil­i­ty (low risk) in their in­vest­ments: con­tent to ac­cept low­er re­turns in ex­change for greater in­vest­ment cer­tain­ty;

• In­come-ori­ent­ed. Gen­er­al­ly, these in­vestors pre­fer fi­nan­cial in­stru­ments that pro­vide a steady in­come stream in the form of coupons, in­ter­est and even re­li­able div­i­dends;

• Cap­i­tal preser­va­tion/loss aver­sion. Pro­tect­ing their ini­tial prin­ci­pal/in­vest­ment is a pri­ma­ry con­cern for risk-averse in­vestors, with em­pha­sis on avoid­ing loss­es;

• Liq­uid­i­ty. This in­vestor val­ues rel­a­tive­ly quick ac­cess to funds, opt­ing for in­vest­ments with de­gree of con­vert­ibil­i­ty to cash in a short time with lit­tle to no loss in val­ue; and

• Time Hori­zon. Be­cause of this liq­uid­i­ty pref­er­ence, the Con­ser­v­a­tive in­vestor tends to have short­er in­vest­ment time hori­zon. In­vest­ments are most­ly with­in 1-3 year tenors, with some de­ployed in medi­um term (five to sev­en years) in­stru­ments.

The ar­ti­cle res­onates be­cause peo­ple who have re­tired at age 60 or 65, should be, by defin­tion, con­ser­v­a­tive in­vestors af­ter decades of per­haps be­ing fair­ly ag­gres­sive ones.

I be­lieve US-dol­lar bonds are ap­pro­pri­ate for risk-averse, in­come-ori­ent­ed in­vestors in T&T who are seek­ing cap­i­tal preser­va­tion and liq­uid­i­ty. US-dol­lar bonds, as well, are use­ful if the ad­min­is­tra­tions of this coun­try con­tin­ue to record fis­cal deficits, which con­tribute to high­er debt loads and make the flota­tion of the TT dol­lar more like­ly. In oth­er words, US-dol­lar bonds are a nat­ur­al hedge against fis­cal ir­re­spon­si­bil­i­ty.

This is how Bourse de­scribes in­vestors who are near or in re­tire­ment:

“One com­mon strat­e­gy among con­ser­v­a­tive in­vestors is to ad­just their in­vest­ment al­lo­ca­tion based on their age. As in­di­vid­u­als get clos­er to re­tire­ment, they may shift their port­fo­lio to con­tain a high­er per­cent­age of low-risk as­sets such as fixed-in­come se­cu­ri­ties.

“With less time to re­cov­er from po­ten­tial mar­ket loss­es, their fo­cus shifts to pre­serv­ing cap­i­tal and gen­er­at­ing in­come. Peo­ple at or near re­tire­ment are al­so typ­i­cal­ly at peak as­set ac­cu­mu­la­tion; in­vest­ment re­turns from low­er risk/con­ser­v­a­tive so­lu­tions are usu­al­ly able to fund lifestyle ex­pens­es at this stage of life.”

Bourse al­so out­lined in­vest­ments that may be suit­able for con­ser­v­a­tive in­vestors: in­come funds; re­pur­chase agree­ments; fixed de­posits; in­vest­ment grade bonds; and to a less­er ex­tend div­i­dend-yield­ing stocks.

The in­vest­ment ser­vices com­pa­ny ad­vanced a sam­ple con­ser­v­a­tive in­vestor port­fo­lio, which it stat­ed “might com­prise”:

* 10 per cent in in­come funds

* 35 per cent in re­pos/fixed de­posits;

* 35 per cent gov­ern­ment bonds; and

* 20 per cent in div­i­dend stocks

“Based on pre­vail­ing re­turns across these as­set class­es, the ex­pect­ed weight­ed re­turn on such a port­fo­lio would typ­i­cal­ly range be­tween 3.5 per cent and 4.0 an­nu­al­ly,” ac­cord­ing to Bourse.

In my view, this is where the analy­sis of the in­vest­ment ser­vices provider falls down some­what. What in­vestor would be able to fund their re­tire­ment with a re­turn of 4.0 per cent? A 4.0 per cent re­turn on a re­tire­ment lump sum of $500,000 yields the re­tiree $20,000 a year or $1,666 a month. A 4.0 per cent re­turn on a re­tire­ment lump sum of $1 mil­lion yields an an­nu­al re­turn of $40,000 a year or $3,333 a month. Is that enough to con­tribute to a de­cent re­tire­ment pot?

I think more ap­pro­pri­ate ad­vice for T&T na­tion­als in re­tire­ment, or close to it, would be to build a mod­el port­fo­lio com­pris­ing 80 per cent US-dol­lar bonds yield­ing be­tween 7.5 per cent and 9.0 per cent. The 20 per cent of the port­fo­lio could be eq­ui­ties pay­ing a five per cent div­i­dend in US dol­lars.

But where does one find US-dol­lar bonds pay­ing up to nine per cent? My sug­ges­tion is to please di­rect that ques­tion to your bro­ker or in­vest­ment ad­vis­er.

Dis­clo­sure: I am NOT an in­vest­ment ad­vis­er; I am a jour­nal­ist. I would ad­vise any­one who wants more per­spec­tives on their re­tire­ment port­fo­lios to seek the ad­vice of an in­vest­ment pro­fes­sion­al.