Retirement Planning in Kenya
Craft a worry-free retirement by building guaranteed income with a pension plan
5 Consequences of Retiring without a Plan:
- Financial Instability
- Inadequate Healthcare
- Increased stress and anxiety
- Reduced quality of Life
- Dependence on others for financial support
5 Advantages of setting up a pension plan:
Tax Benefits
Contributions are often tax-deductible, reducing your taxable income during your working years.
The growth of investments within the plan is tax-deferred, meaning you won’t pay taxes on the gains until you withdraw the funds in retirement (after 65 no taxes at all)
Guaranteed Income in Retirement
Provides a reliable and predictable income stream in retirement, helping to ensure financial stability and covering essential living expenses once you stop working.
Protection from Market Volatility
Some pension plans offer a predictable payout regardless of market conditions, protecting your retirement income from market fluctuations
Disciplined Savings
Pension plans encourage regular savings, as contributions are often automatically deducted from your salary/ income. This disciplined approach ensures you consistently build a retirement fund over time.
Financial Security and Peace of Mind
Knowing that you have a pension plan in place offers peace of mind, as it helps to secure your financial future and allows you to enjoy your retirement years without the worry of running out of money.
How does it work?
How much do you need to save per month to retire?
The earlier you start planning for retirement, the better. See below:
Goal: To receive Ksh 300,000 per month upon retirement
Age of Retirement: 65
FAQ:
Do I need an Individual Pension Plan if I have a group pension through my employer?
Yes, so that it is easy to transfer from your group to your personal pension when you resign. Helps with consolidation of pension plans from all your previous employers
If I leave employment what happens to my contribution?
You can withdraw your part of the contribution (not recommended)
You can transfer to your individual pension plan. Take control of your money and let us help you transfer the funds to your individual plan.
What happens to the pension savings if I die?
Paid out to designated beneficiaries.
How do I know how much I have contributed to the scheme and the interest I have earned?
At the end of every year, the insurance company sends a statement to each member reflecting the contributions made by the member and the interest attained.
Can I use the benefits as security to borrow money?
Yes. A member can assign up to 60% of their accumulated benefit as additional security for a mortgage in line with RBA regulations
Can I lose my retirement fund?
No if you contribute towards a guaranteed fund. Contributions have 100% capital guarantee
The insurance company managing the fund bears the loss (in case money is lost in the course of an investment) You do not bear the risk of the investment.
Are the fund managers you work with regulated?
Yes, by the Retirement Benefits Authority.
Plan Your Legacy with Le’Risque Africa Today
Secure your future with Le’Risque Africa’s reliable retirement planning services. Our comprehensive approach ensures that you save effectively today to enjoy a comfortable and financially secure retirement tomorrow.