Several years after the reform of the pension scheme in Nigeria, there is still trepidation about the success of the scheme. A particularly knotty issue is the mode of collecting benefits after retirement. It would seem that many retirees prefer programmed withdrawal to annuities without considering their individual circumstances. This portends a dangerous trend for the pension scheme. In this paper we attempt to bring in the individual characteristics into the decision making process by comparing the replacement rates of a potential retiree under the programmed withdrawal with that of life annuity. Our study reveals that life annuity may be the future direction if the scheme is not to face the same fate as the previous defined benefit scheme.