Uganda: Experts Advise Ugandans On How to Cope Up With Life After Retirement

The National Social Security Fund(NSSF) recently indicated that 80% of its beneficiaries use their entire savings after only two years.

The National Social Security Fund(NSSF) recently indicated that 80% of its beneficiaries use their entire savings after only two years.

In this study by NSSF, at least 20% of Ugandans achieve a semblance of managing their savings and living a comfortable life.

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Worse still, only 5% of retirees in Uganda achieve financial independence after retirement according to the 2018 Finscope survey.

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Financial experts attribute this to employees who spend their entire life working for organizations and when retiring, they venture into small-scale businesses but lack entrepreneurial skills to sustain and manage them hence losing their lifetime savings.

Claire Kateregga, the Marketing Manager at Buildnet, observes that investing in real estate is a smart way for employees to safeguard their hard-earned savings.

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Kateregga notes that Ugandans can use their life savings to purchase properties like condominium apartments and rent them out to earn a monthly income that caters to their needs.

"Unlike conventional businesses, real estate offers salaried employees inexperienced in running businesses a chance to buy and rent out properties that earn them an income with limited management costs," she said.

The journey to invest in long-term assets like real estate starts with a dedicated savings plan, it is an integral part when it comes to investing in real estate as a retirement plan, according to Kateregga.

Bank of Uganda's Deputy Governor Mr. Atingi-Ego, said there is a need for several social transformation initiatives to assist Ugandans to embrace a culture where they save to invest.

According to the financial capability report by the Bank of Uganda, only six out of ten adults save, and of these 54% of them had saved for consumption (food), and only 25.4% had saved for investment.

Rosemary Ssenabulya, from Uganda Retirement Benefits Regulatory Authority-URBRA, notes that retirement is an inevitable part of life; however, many young people do not plan for it.

"Once one gets employment and starts earning an income, the focus is on satisfying immediate needs. Unfortunately, the needs keep on growing so one gets engrossed in spending with little regard to what will happen in the future," says Senabulya.

"If you want to retire and live in comfort, a retirement plan and commitment to saving are vital. People in their 20s, 30s or 40s are especially advised to start planning, saving, and investing for retirement.

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