81% of Kenyan Pensioners Working to Make Ends Meet

Dennis Gitau | Apr 2, 2020

81% of senior citizens need to work to meet their basic needs in Kenya, calling into serious question the sustainability of pension pay outs and retirement benefits coverage. The quarterly jobs report released by the Kenya National Bureau of Statistics revealed that a whopping 708,902 out of 869,338 persons over the age of 60 were still in employment as of December 2019 with another 40,296 people over 50 years still actively looking for jobs.

With fewer younger people taking care of pensioners and the average pension being much less than the recommended percentage of income, elder poverty is about to reach crisis level.

In fact, many Kenyans are working way past retirement age in order to make ends meet.

The recommended pension savings should give retirees a monthly income of 75-80% of their salary upon retirement. However, the few Kenyans with a pension are saving barely half of that. On top of that, many prefer to have their retirement benefits paid out in a lumpsum instead of an income drawdown. As a result, they burn through their pension within a short amount of time and are forced to return to work. Additionally, the country has insufficient pension coverage, with over 70% of Kenyans retiring without ever having a pension.

The situation is dire, with the state sending a Kshs 2,000 stipend to everyone under the age of 70 to help combat elderly poverty. However, even this is insufficient and unsustainable. Clearly, more needs to be done to address this issue.

Kenya using tech in war on pandemic

Kenya is among African countries leveraging various forms of technology to fight the Coronavirus pandemic. Kenya is also the leading African country in digital payment adoption. In a contin...