By Mercy Mumbua
In an effort to tackle Kenya's alarmingly low retirement savings rates, the Retirement Benefits Authority (RBA), in partnership with the Media Council of Kenya, conducted an extensive training session for journalists at Voyager Beach Resort in Mombasa. This initiative aimed to equip media professionals with the essential knowledge needed to educate the public on the significance of saving for retirement.
According to the RBA, a mere 26% of Kenya's working population, roughly 7.6 million people, are currently saving for retirement. "We have seen that we have a problem whereby only 26 percent of Kenyans are saving for pensions," stated Jackson Nguthu, the Director of the Retirement Benefits Authority. "We should all work together to spread the word so that people, especially the youth, start saving. Retirement will come at a later time, and it's essential to begin saving early so that everyone can depend on themselves in old age."
Jackson Nguthu, the director of the Retirement Benefits Authority, talking to the media during the training on reporting on Retirement savings in the media. Photo: Courtesy.
During the training, key aspects of the RBA's mandate were highlighted, including the regulation and supervision of retirement benefits schemes, the protection of scheme members' interests, the promotion of the retirement benefits industry, and the advice of the National Treasury on policy matters. Additionally, the RBA's role in implementing government policies related to pension plans was emphasized.
The training addressed various challenges and misconceptions surrounding retirement savings. Journalists were informed about the significant benefits of Saving, such as tax exemptions on contributions up to KSh 20,000 per month and tax-exempt investment income. Nguthu underscored, "Saving has been a voluntary act for the longest time, and this has not effectively encouraged people to save. To improve coverage, a National Retirement Policy was adopted last year, and we are now working on its implementation. We expect to see changes in the next two or three years."
Key sessions included discussions on the importance of saving, payout processes, and options available to individuals retrenched before reaching retirement age. Fatuma Buku from NTV inquired about the fate of savings in cases of retrenchment. The training provided solutions, stating that individuals have three options
· leave the money until retirement age,
· transfer it to a new occupational scheme or
· withdraw 50% immediately and the remainder upon reaching retirement age.
Journalists taking part in the training organized by the Retirements Benefit Authority and the Media Council of Kenya. Photo: Courtesy
The training also tackled the societal issue of reliance on family support, emphasizing that "your children are not a retirement plan." With job security not guaranteed, saving is crucial to ensure financial independence.
The Retirement Benefits Authority outlined its strategic goals to increase the percentage of people saving for retirement in the coming years. It involves ongoing public education efforts and the potential introduction of mandatory retirement savings policies. Nguthu concluded, "It's crucial that we start saving early. Everyone needs to understand the importance of preparing for retirement to avoid dependency in old age."
By empowering journalists with accurate and comprehensive information about retirement benefits, the Retirement Benefits Authority aims to enhance public awareness and encourage more Kenyans to participate in saving for their future.
