Retirement training call as old age poverty rises

Tough economic times, blamed for the hand-to-mouth lifestyles, means a majority of elderly Kenyans will remain actively engaged long into their twilight years.

The upside is a large number of matriarchs and patriarchs are unconsciously keeping diseases at bay largely blamed on sedentary lifestyles that come with idleness during retirement.

In its latest study on savings and credit societies’ membership demographics, Sacco Societies Regulatory Authority (Sasra) has called for an urgent review of products on offer with special consideration given to active and experienced young old retirees (Yold)- workers aged 65 years that comprise 273,000 or 5.51 percent of the 4.9 million sacco membership.

In the next decade, their number could rise above one million as another 872,000 now aged between 51 to 59 years, clock the mandatory retirement age of 60 years.

“The traditional practice of employer-based saccos is often that the members normally withdraw from the membership immediately upon retirement from formal employment,” says the report.

Farmer-based saccos had 7.89 percent of their membership being the Yold’s population, teacher saccos (3.5 percent) government saccos (1.8 percent) while private sector saccos membership was at 4.69 percent and at 7.22 percent for community-saccos.

“Deposit taking saccos need to configure their management information systems to capture, reflect and report on age and gender data that can be used to design and formulate member-friendly financial services and products,” it said.

In its latest report on old age saving, market research firm Infotrak says 84 percent of working Kenyans have never heard of old age savings schemes or products.

“Kenyans deem pension schemes to be too costly where information on products on offer remains scanty. The government is not doing enough to increase uptake of pension among young people and the high levels of corruption in the country’s financial institutions emerged as a key hindrance for growth in pensions,” added Infotrak chief executive Angela Ambitho.

RIGHT POLICY

And a research paper dubbed, Retirement Lived Challenges Experienced by Retirees, the Case of Retired Teachers in Makueni County urgently calls for establishment of a national desk in charge of retirement planning training.

Technical University’s Annastacia Katee-Musila, Jamin Masasabi (Moi University) and South Eastern University’s Harrison Maithya sampled 249 respondents (173 were males and 76 females).

“We concluded that inability to plan, save and invest for the future leads to suffering in retirement. Retirees need to cautiously approach ‘new’ societal responsibilities as key leaders, as a way of balancing their time to avoid fatigue and distress,” they recommended.

The study added that retirement training should start long before employees exit employment to equip them with skills on passive income investments, lifestyle skills that promote healthy living as well as money management.

“Lacking post-retirement life skill training sees retirees exiting work without any idea of what to expect and how to deal with the uncertainties of unemployment. Majority go home without medical cover that when life shocks like sickness hit them or their close relatives they end up selling off the few resources they own.

“The problem of poor planning is worsened by the delay in disbursement of pension money that sees retirees taking up new employment roles to complement their meagre savings. Retirees should also reduce the number of volunteer-work in local development committees or meetings they choose to attend to avoid burnout,” they added.

A joint 2019 study by the Institute of Human Resource Management, Enwealth Financial Services and Strathmore University called for a national discourse on retirement study, saying over 80 percent of Kenyans were staring at old age poverty.

Most Kenyans have no idea how much money they need to sustain their lives in retirement, the study said.

Enswealth CEO Simon Wafubwa added, “A majority have no plan at all about their health needs once they retire but instead put their hope in family and friends’ donations. Only one in seven respondents are very confident of outliving their retirement savings and this is a serious crisis in retirement.”

County Pension Fund chief executive Hosea Kili said retiring Kenyans require at least 65 percent of their working salary to meet their daily upkeep needs.

Mr Kili blamed the savings’ apathy for the suffering now witnessed among senior citizens who heavily relied on government welfare stipend and medical services.

Association of Retirement Benefit Schemes council member Jane Gitau concurred saying a national discourse was necessary for Kenya to get a policy that understands old people with funding provided for research, social services as well as guiding formulation of certificate, diploma to degree level curriculum on old age studies.

Interestingly, insurance companies hardly provide products for senior citizens while banks have no incentives or discounts for senior citizens using their services, making for a gloomy outlook for the elderly.