While working is commendable, for an elderly person, it should not be a means for survival; rather, a hobby or way of keeping occupied. That is why it is paramount that youths start saving for their retirement as early as possible.
In Uganda, youths are ranked between 18 and 35 years but in this demographic, employment commences around 23 years after they have completed their education at tertiary level. It is shocking to see that some of the employed youth believe they are still too young to save and procrastinate on this safety net for the indefinite future.
Youths should know that savings will, at length, be a source of future survival. Employment is not perpetual, especially in this era where companies are increasingly downsizing because of rising operational costs.
There is an ill-advised sense of complacency that creeps in, when most of us begin earning money. As a worker, you have between 23/4 and 50 years of gathering savings to cater for the rest of your life.
Therefore, the million-dollar question is: can the current youth lifestyle choices ensure old-age security? The majority of Uganda’s youths have long fallen into the habit of wasteful spending, indulging themselves in alcohol and drug binges and parties.
According to police records, 2,463 adult males and 151 adult females were involved in narcotics or drugs in 2017. The drug vice is eating at today’s youths and a quick and permanent solution ought to be found in order to numb this habit. These shortcomings among the youths are deterring their efforts for growth.
At the moment, Uganda Retirement Benefits Regulatory Authority (URBRA) has devised various ways for people to cater for those ready to save for the future without feeling the pinch.
One much scheme is the National Social Security Fund, regulated by URBRA, which deducts five per cent off your salary, is bolstered by your employer who adds 10 per cent to be dedicated to your retirement savings.
The savings are entitled to interest earnings on an annual basis, which will be given to you at 55 years, upon your request. Last year, members of NSSF earned a 15 per cent interest on their savings attributed to the good performance of the fund.
While NSSF caters for those formally employed or previously formally employed, URBRA licensed Mazima and KACITA retirement schemes that allow the informal sector to save for their retirement.
In many aspects, Uganda’s informal sector, which makes up 80 per cent of the country’s labour workforce, has lagged behind in terms of saving for retirement. Through the years, the informal sector schemes have given opportunity to the informal community to save for the future. These savings are also subjected to interest earnings since their savings are invested.
One may want to argue that many youths are unemployed, which is true. According to the Uganda Bureau of Statistics, 13.3 per cent of the youths in the 18-30 age group are unemployed.
In a bid to support the unemployed youth, government has introduced many projects aimed at helping youths acquire skills to create their own jobs as well as seed capital for businesses. The projects are also not in isolation of the private sector which has strongly empowered the youth to acquire skills and knowledge to prosper.
It is now incumbent on the youth, especially those in the formal education system, to seek experience prior to completion of university. For instance, if youth started volunteering and interning while in their first year at university, they would graduate with at least three years’ experience in their work of interest.
So, fellow youth, old-age security is guaranteed on savings accumulated through your youth, which calls for hard work and planned spending.
The author is the Communication & Public Affairs Officer, URBRA.
