Retirement from work has been associated with many challenges. These challenges range from strained finances, feeling of loss and the need to re-adjust in life, dependency, lack of proper medical covers, debilitating illnesses and even early death. Besides, most people are plunged into the reality of entering their old age without a proper source of income . For most employees approaching retirement age, the dilemma has always been how to survive the tough economy and what to engage in daily, once their working life is over and their main source of livelihood is no longer there.

In Kenya, the retirement age has been 55 years for a long time but since 2009, this age has been changed to 60 years.

Concerns were raised on this as many Kenyan’s felt that this would deny the youth employment because essentially, retirement creates employment for the younger generation. This clearly demonstrating that most of the Kenyans and the government as well is more concerned about the youth than the retirees, which is to be expected, because people are well aware that retirement is coming, 20 or even 30 years to come.

With this awareness, it is expected that people will anticipate and plan for their retirement but this is not always the case with many Kenyan employees. According to Retirement

Benefit Authority ( RBA), it is estimated that only 15% of Kenya’s 12 million labour force are covered under a retirement benefit scheme. Majority of those covered are in the formal sector where the cover is readily available either through employer-sponsored occupational schemes or because of the statutory requirement that any employer with more than five employees must enjoin the workers to the National Social and Security fund(NSSF, 2013). This means that upon retirement, for sustainable most Kenyans will depend on savings and such investments as stock, land and others.

Saving for retirement in Kenya is one of the most neglected financial obligations in the country. Most young people hardly spare a thought to saving for retirement until old age

comes knocking. One of the reasons why it may be quite hard to save is because for most people meeting their daily expenses leave alone save for the future is such a hassle.

What next?

“lifestyle one chooses to live today determines how they will retire later in terms of their financial planning. Those who live below their means are usually disciplined and down to earth so as to live a lifestyle lower than they could easily afford. They spend quite a large amount of their income on savings for their future and that of their children, helping the less privileged in the society rather than on pleasures and things they can do without.“Says Nguru-(Researcher)

According to research there are two major reasons why most retirees lack adequate financial resources: poor planning and catastrophes  such as illness. As most insurance companies do not insure people past a certain age, retirees need to take insurance cover before attaining the maximum age so that they can continue renewing it, which is allowable. As people get older , they tend to spend more on health because they get ill quite often. This is why insurance companies hesitate to insure an aged person who previously had no cover.

It is often suggested that retirement is fine for the professional classes because they can continue to work if they wish to but that the poor do not have the same privilege. What it really boils down to is that the rich can afford to retire but the poor cannot. Inherent, therefore, in any thinking on retirement is the fact that we must provide adequate pension rights to enable people to live without the fear of the stigma of ‘charity’. RESET Kenya provides forums to share experiences in life, social interactive sessions in real life solutions across all aspects of their lives.

RESET Kenya engages retirees and ensures they get skills  in ago-processing, value addition and manufacture of various consumer products for sustainability.

Pension and succession

In Kenya a retiree can take a lump sum of their pension, it is advisable that they invest part of it in a secure place such as in a unit trust,Sacco, real estate or in stock portfolio managed by a professional fund’s manager. The retirement package in whole or in part can be converted into a fixed periodical payment, usually monthly so that it looks like another salary for the rest of the retirees’ life or his spouse’s life. This is called annuity. However this mode or retirement package does not factor in inflation. Whereas people who are employed enjoy occasional pay rises to reflect inflation and other economic factors that drive the cost of living a retiree may continue getting the same amount every month for the entire period of post-working life which could extend to as long as 40 years. RESET provides opportunities to impact the retirees on skills and mentorship on succession.

This typically means if they utilize all their monthly pensions on items such as foodstuff, utility bills, entertainment, clothing and other basics with no savings, they will not afford these as time goes by and prices go up unless they have other sources of income. They will either cut down on their expenses or look for other sources of income.


Retirees who are starters in the business world, have limited sources of refinancing and less time to recover and learn from mistakes unlike young people venturing into business, for whom time is their greatest asset. They can afford to make mistakes and learn from them. They can fail in one business and start another one. They can afford to lose everything and start all over again. This is not so with old people who other than the time factor, usually do not have the agility and stamina to hop from one venture to another. They also are already tired and ill prepared to cope with the challenges that go along with pioneering a business. It would be better for one to start a business while still working. This way one has resources and fall back plan should the business fail. It also gives one enough time to learn the rules of the game. RESET walks with the retirees after their active years of employment, to guide, mentor and create re-employment in retirement that will keep the retirees busy.

RESET Kenya thrives to tap The invaluable experience and knowledge held by retirees which is sometimes indispensable and this occasionally calls for some elderly workers to be allowed to continue working though on a different level and they remain socially active for relatively longer.