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Popular Excuses For Not Saving For Retirement

“Planning is bringing the future into the present so that you can do something about it now.” – Alan Lakein.

When one is young, or even middle-aged, retirement seems to be a distant reality, thus saving for that time which may or may not come does not seem like a priority.

There are numerous excuses for spending your money on something more immediate and practical than saving it for retirement. Below are some common excuses we give for not saving, and why these excuses need to be dropped.

  1. I Don’t Make Enough Money

No matter what you earn, there is always room to cut an expense somewhere and save a few shillings every month, say at least 5% for retirement. Whatever you can spare, saving on a regular basis adds up over time. When your income increases, you can increase the amount you save. As interest compounds on your savings, the money also accumulates. Over a lifetime of working, a substantial nest egg accumulates to enable you retire in comfort.

  1. I Do Not Have A Regular Income

You don’t need a regular income to save for retirement. Today, retirement plans like the Zimele Pension Plans are flexible allowing you to save even a minimum of Ksh.100 at your own pace. We understand that for many entrepreneurs in the new economy, their income is not received every end month, so we don’t expect you to save money every end month either. We let you custom your retirement plan to your income pattern.

  1. My NSSF Benefits Will Meet My Retirement Needs

Saving into the National Social Security Fund (NSSF) is mandatory and is a good place to start, but it is by no means sufficient on its own. Making good use of personal pension plans or employer-sponsored pension plans is one of the best decisions you will ever make for safeguarding your future in retirement.

If you contribute Ksh.1,000 to the NSSF for 30 years, will have accumulated to a total of Ksh. 360,000. At a hypothetical rate of return 7% compounded annually, it will total to Ksh. 1,176,506, which will amount to a monthly stipend of ksh.4,902 over the next twenty years, which will be nowhere near what you will need to maintain your lifestyle.

  1. When I retire I will cut expenses and embrace a more frugal lifestyle

When it comes to retirement income, many experts swear by the 80% rule. They advise that you will need 80% of your salary to cover your retirement expenses. That’s based on the salary you receive just before you retire. So, if you were earning Ksh.50,000 every month on your final working year, you will need Ksh.40,000 monthly income to sustain your lifestyle in retirement. It is not practically possible to cut back enough to stretch your savings in retirement.

  1. I have too much debt and too many current expenses

If you are burdened with debt and ongoing expenses, it is time for you to draw up a balanced (or surplus) budget and make optimal use of it. Review all your monthly expenses and see what can be reduced or eliminated.

Try to live within your own means if possible. If you can get a surplus of cash from these efforts, stash it away for retirement. It really is that practical and simple.

[Read more: Budgeting Strategies That Work]

  1. I do not know anything about investing

The good news is, you don’t need to be an investment expert, just join a personal pension plan since they are managed by professionals who make investment decisions on your behalf. Ensure that you join a pension plan licensed and regulated by the Retirement Benefits Authority (RBA), which safeguards the safety of your retirement benefits.

  1. I’m too old and I missed my chance

Unless you have reached retirement age, it is never too late to join a personal pension plan. There is a plan for every age group. Younger savers are encouraged to take advantage of growth funds such as the Zimele Personal Pension Plan. The fact that a portion of the funds is invested in shares and treasury bonds enables younger savers to enjoy the higher returns associated with risky assets. Those who are closer to retirement age are advised to focus on less aggressive funds such as the Zimele Guaranteed Personal Pension Plan which offer guaranteed returns and are not affected by stock market volatility.


Think about the reality of old age poverty. The unfortunate reality is, if you don’t save for retirement and live to see retirement, you are setting yourself up for a life of dependency and loss of dignity in your old age. You might become a burden to your loved ones, and society as well. You can change all this by joining the Zimele Personal Pension Plan today.


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