A significant portion of Kenyan retirees are facing financial strain as they shoulder the responsibility of supporting adult dependents, well into their retirement years. The dependency burden highlights the impact of growing joblessness, particularly among young adults. 

Data from the Pensioner’s Survey 2024 show that 39 out of every 100 retirees provide financial support to children aged over 25, demonstrating a growing dependency strain that may be eroding the adequacy of retirement benefits. 

The Retirement Benefits Authority (RBA) survey conducted across 43 counties with responses from over 500 retirees found that nearly half of the respondents had at least one dependent relying on them financially after retirement. 

While the traditional African family model emphasises intergenerational support, the findings suggest this dynamic may be placing unexpected pressure on pensions that were already insufficient to maintain pre-retirement living standards. 

“Retirees should be more informed about the expected dependency burden to encourage greater retirement savings,” the report recommends, calling for targeted education and policy intervention.

With income replacement rates averaging just above 50 per cent, many pensioners are being forced to stretch limited monthly payouts across wider familial responsibilities than they had planned for.

The dependency strain is compounded by the fact that most of these retirees were employed in the formal sector and expected their retirement packages to meet their individual needs.

However, the realities of modern family dynamics, rising costs of living, and prolonged economic hardship among younger adults have meant that pensioners are increasingly becoming secondary providers for adult children and, in some cases, grandchildren. 

The report also found that 53 out of every 100 retirees believe that financial support from children should be voluntary rather than expected.  

This subtle shift in perception reflects the frustrations among pensioners who may have assumed that financial responsibilities would lessen with age.  

Instead, many are finding themselves locked in a cycle of continued provision, often without adequate income buffers or diversified retirement investments. 

The situation is made worse by the low uptake of voluntary pension contributions during active employment.  Eighty-one out of every 100 retirees reported they did not make additional voluntary contributions to their pension schemes, meaning they now rely heavily on statutory payouts that are not structured to cover extended family obligations.

A significant proportion, nearly half, indicated they had some savings in Saccos, underlining the importance of alternative saving vehicles outside the pension system. 

Furthermore, the survey showed that 67 out of every 100 retirees felt they should have saved more in preparation for retirement.  

These feelings of regret were often tied to the surprise of having to cater to family needs, which in many cases were not anticipated during financial planning. 

The demographic shift in dependency patterns, where adult children are still reliant on their parents, adds a layer of complexity to retirement planning that is rarely addressed in policy discussions or personal finance education. 

Key expenditure items 

Healthcare and education costs continue to be key expenditure items for retirees.

While personal health ranked as the most important post-retirement concern for 32 out of every 100 respondents, educating children and grandchildren also featured prominently, further indicating that retirees are using their limited income not only for personal upkeep but also for investments in their family’s future. 

The report suggests that government and pension sector stakeholders should incorporate dependency awareness into pre-retirement training and financial literacy programmes. 

Such training could help retirees anticipate post-employment financial obligations more realistically and adjust their savings behaviour accordingly.  

Currently, only half of retirees reported having received any form of retirement training, with most of those trained receiving it just a year before their exit from employment. 

The report underscores the need to introduce mandatory retirement training early in employees’ careers to encourage better savings habits, highlighting that earlier interventions could improve long-term financial outcomes.  

Policymakers are also being urged to consider reforms that address the multi-generational economic roles retirees continue to play, particularly as average life expectancy increases and economic recovery for younger generations remains uncertain.