In a move to address the pressing challenges facing the retirement benefit schemes, trustees have been urged to shift their focus towards the younger generation.
Speaking during the opening ceremony of the Zamara 2023 trustees convention, the Director at the School of Pension and Retirement Studies, Dr. Edward Odundo highlighted the importance of early planning. “The younger members of the workforce that is today the larger component membership of retirement benefit schemes is notorious for not being very focused on many things long term such as preparing and saving for future retirement. They want to live for the here and now and not for tomorrow,” he said.
“This represents a challenge we must rise to as a society and as a sector. There are no alternatives to savings. We cannot innovate ourselves out of the need to save for our future needs. Savings requires that we put aside the lure of instant gratification. This is a battle we must be ready to fight and win today so that we can face the challenges tomorrow will bring”, Dr. Odundo said, adding, “Our collective responsibility is to empower and educate the younger generation about the significance of long-term financial planning, which includes retirement savings.”
To address this issue, a collaborative effort is required from parents, employers, trustees, and other stakeholders. A multi-pronged approach is needed to create better awareness and develop effective strategies for incentivizing savings among the young population. The growing temptation of instant gratification must be countered, as savings require individuals to set aside the lure of short-term pleasures.
On his part, James Olubayi, Executive Director, Zamara said that the need for savings is universal, and without proper planning and engagement, the younger generation may face uncertain financial futures. This concern underscores a critical challenge that both society and the retirement benefit sector must tackle head-on.
“The retirement benefits sector is at a pivotal juncture, and it must adapt to the evolving needs and attitudes of its membership base. Trustees have a critical role to play in steering the course toward a secure and prosperous retirement for all members, regardless of age. The time to act is now,” he said.
The second such conference held this year by Zamara seeks to chart a course towards advancing pension solutions that are not only robust but also resilient, capable of withstanding the tests of time. Themed, safeguarding futures advancing pension solutions, the conference taking place over the next three days will see industry players dig into trends and insights on pension adequacy, investment, and contributions, and share the progress of the industry in Kenya.
The conference also provided a platform for experts as well as major industry players to network, and share experiences on the emerging trends and happenings within the pension sector which has witnessed a noticeable growth to the level of Sh 1.7 trillion with a contributor population of 4.3 million, representing a coverage of 26 percent of the working population.