APA Life Assurance CEO Eric Wanting, APA Apollo Group CEO Risper Ohaga and Enwealth Financial Services CEO Simon Wafubwa during the APA Life Pension Masterclass /HANDOUT
With Kenya's life expectancy reaching roughly 67 years and the mandatory public service retirement age remaining at 60, retirees are spending more decades out of the workforce.
Financial and retirement experts are now urging Kenyans to start contributing to retirement schemes early to avoid outliving their savings.
According to the experts, the push to rethink retirement planning stems from various key factors that Kenyans are faced with especially the longevity gap whereby retiring at 60 means that retirees are funding between 20 to 30 years of life after formal employment, leaving many vulnerable Kenyans to old-age poverty if they fail to save.
The experts who spoke during a pension forum organized by APA Life Assurance in Nairobi warned that longer life expectancy and rising healthcare costs are making retirement more expensive.
For instance, medical expenses for aging individuals are inflating at approximately 11% annually, pushing retirees to factor personal health cover into their long-term savings.
They also observed that low pension penetration among Kenyans has been a major reason why millions of Kenyans face the danger of struggling financially at old age.
Only about 26% of the Kenyan workforce has an active pension plan, exposing a large portion of informal and low-income workers to future financial insecurity.
APA Life Assurance Chief Executive Officer Eric Wanting said that retirement planning should help people remain financially independent throughout their later years.
"Retirement is no longer just about reaching a certain age or building a pension fund. It is about creating lifelong financial resilience that allows people to live with dignity, independence and confidence. As life expectancy increases, retirement planning must address investment growth, healthcare, financial literacy and ongoing engagement. Through this Master class we are giving Kenyans the knowledge, tools and support they need to prepare for the future with confidence." The CEO said.
The forum also examined the Kenya’s economic outlook, changes in pension regulations, investment options and the growing need for medical cover after retirement.
Participants including pension trustees, employers, human resource professionals and financial advisers said that improving financial literacy and encouraging people to start saving early would help more Kenyans enjoy a secure retirement.
They also called for greater awareness of retirement planning as economic conditions and longer lifespans continue to reshape how people prepare for life after work.
