This archive report was first published on 30 October 2019.
Retirement planning has become a pressing concern for many employees, especially in today's unpredictable work environment. Gone are the days when employees worked until the official retirement age, with some working extensions possible. In the past, civil servants worked under permanent and pensionable terms that ended at 55 years of mandatory retirement age.
However, the landscape has changed significantly, with terms like retrenchment, golden handshake, voluntary early retirement, right-sizing, downsizing, and restructuring becoming common. This has led to employees working in constant fear, often thinking of retirement as soon as they are hired.
Financial Independence ¶
Many employees fail to plan for their financial needs in retirement, relying on NSSF contributions, institutional pensions, and terminal lump sum payments. However, experiences from retired people have shown that these payments are often exhausted within a short period after retirement. To avoid financial embarrassments, employees should begin saving adequately now, using their savings to obtain SACCO loans for investing in income-generating assets or other profitable investment instruments.
Increasing contributions to employer-registered pension schemes and raising NSSF contributions can also boost the retirement kitty. Acquiring skills in personal financial planning through training on money management would be handy, enabling employees to understand their spending habits and accumulate more savings than incurring unplanned expenditures.
Retirement Home ¶
During their working years, employees often stay in staff, rented, or owner-occupied houses. However, cases have been reported of employees being evicted from staff quarters or rented houses at the end of their employment period. On planning for retirement, working people are expected to own retirement homes that meet their needs and lifestyle.
One of the controversial issues on retirement matters is relocation to either the rural area or within town. Anyone intending to return to the rural area where they do not own a house will be forced to use their terminal money to construct one. Moving to a cheaper residential area within town will be a temporary solution, but owning a house in whichever location will enable a fresh retiree to start their retirement on the right footing.
Side Hustle ¶
In recent years, more than ever before, full-time employees have resorted to starting and running side hustles to meet their financial needs. If the side hustle businesses survive beyond the entry stage, it would become a soft landing when employment is terminated for whatever reason. The working class is continually combining side hustles with full-time employment as a retirement planning strategy.
Healthy Lifestyle ¶
Although key components of a healthy lifestyle are better nutrition and regular physical exercises, many people ignore these living aspects. Forgetting the adage “you become what you eat”, they feed on unbalanced diets some of which cause medical conditions such as obesity. As one plans for retirement, it is advisable to develop and implement balanced-diet meal plans and undertake regular physical exercises.
Family Relationships ¶
The state of one’s family relationship plays a key role in determining how an individual manages life issues. Living in a stable family enables one to weather both internal and external storms of life. People whose families are unstable do not obtain the necessary family support system in times of need. It is essential to nurture good family relationships during employment time to facilitate future smooth transition into retirement.
Friends and Community ¶
Social well-being is a key factor in enhancing one’s interactions both at work and in the community. Friends that people make while working may be available to lean on at different times. Such friends would become a sounding board when grappling with retirement issues some of which do not have ready resolutions. Continual identification with community development matters would prepare one for future leadership roles, making it easier to become productively occupied in retirement.
