The Sooner You Plan For Your Retirement, The Better

By Korir Isaac / Published May 11, 2022 | 10:25 am

KEY POINTS

If you are employed in the formal sector, you can register to be a member of the National Social Security Fund (NSSF) and have your employer deduct your monthly contributions from your salary and remit them for you.

KEY TAKEAWAYS

Planning ahead for retirement allows you to decide when and how you will retire, and whether you will continue to work. It is important to give yourself the best chance for a happy and secure future!

Most people don’t think about retirement or spend any time thinking about what will happen when they stop working. For this reason, many people are unable to retire when they’d like to because they were unable to plan for their retirement.

The good news is that even if you haven’t begun planning for your retirement, you can still start preparing yourself at any time. It’s never too late to start anything. All you need to have is the right amount of will and determination.

Planning ahead for retirement allows you to decide when and how you will retire, and whether you will continue to work. It is important to give yourself the best chance for a happy and secure future!

Here are some tips to help you start on your retirement plan:

Set a Retirement Goal

To get anywhere in life and achieve success, you need a goal. It is the same when it comes to retirement.

Start by envisioning what you see as a successful and financially secure future in retirement.

Ask yourself some of these questions: Do you want to have financial independence? What does that look like for you? Does that mean you will live independently or with family? Do you want to travel or would you prefer to stay in your community?

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Any retirement plan starts with setting your own goals and envisioning your desired outcomes.

Start Saving More for Retirement Now

Most people find it unrealistic to start saving for their retirement in their early working years given that they do not make much during this time.

However, waiting until you’re in your 40s or 50s to start thinking about retirement is a very big mistake because by this time you have passed up the opportunity to let your savings grow over time.

People need to realize that when they begin saving earlier in their career life, they don’t have to save as much later on to reach their retirement goal.

Setting aside even 3 percent of your paycheck for retirement adds up over time. When you include retirement planning in your budget at a younger age, you also develop good habits early on instead of trying to learn them later in life.

Reduce and Avoid New Debt

The best and easiest way to avoid debt is to live within your means. This is one thing that most people don’t seem to understand.

However, if you are already down that road where you’re already in debt, it’s not too late if only you purpose and plan to reduce it.

Additionally, try to avoid taking on new debt at this point in your career, since your ability to repay the debt may decline when you leave your full-time job.

How to Start Saving for Retirement

NSSF is available to Kenyans above 18 years of age, and it allows you to build a social savings net by making monthly contributions for your retirement. The minimum amount one can save with NSSF is Kshs.200. However, contributing more is highly recommended to enjoy the benefits of more funds when you retire.

You can also choose to be a voluntary member where you will pay a minimum of Kshs.200 to activate your membership and contribute the same amount, or more, every month as you build your social savings net.

If you are in the informal sector, you can opt for the Haba Haba product by NSSF. The product, which is accessible through USSD code *303# gives members in the informal sector a chance to save a minimum of 25 shillings a day, with the option of withdrawing 50 percent of their contribution after consistently contributing for a minimum of 5 years.

This is unlike other benefits NSSF offers in the formal sector where members have to retire to access their savings. NSSF is currently working with members in the matatu sector, Bodaboda sector, and digital taxis, among others to bring more Kenyans into the social security net.

For instance, through the NSSF partnership with members of the Boda Boda Association of Kenya, operators can use the code *303*2# to access pension, medical cover, and welfare at 60 shillings per day.

Market vendors, on the other hand, can access medical insurance from NHIF, Pension from NSSF, loans from KCB, and airtime from Safaricom at 100 per day. Digital taxi drivers can access the same services with the same amount as well.

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Conveniently, Haba Haba is also committed to the social protection of Matatu operators in Kenya, which are mostly run by youth. As such, under the NSSF’s ‘Haba Haba Nikujipanga’ product, matatu operators can now redeem their Bonga Points for NSSF savings and opt in to any of the available packages.

How to Register for NSSF

You can register with NSSF using the USSD *303# or by visiting the nearest NSSF office. Click Here for more information on member registration.

If you are an employer interested in registering yourself/your company with NSSF, please Click Here for more information on employer registration.

About Korir Isaac

A creative, tenacious, and passionate journalist with impeccable ethics and a nose for anticipated and spontaneous news. He may not say it, but he sure can make one hell of a story.

View other posts by Korir Isaac