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NSSF Members Discouraged From Early Benefits Claims

Members of the National Social Security Fund (NSSF) have been discouraged from accessing their retirement benefits at an early age to avoid mismanagement of the funds.

According to the new NSSF Uganda Act, members are allowed to access their savings as early as 45 years of age instead of the 55 years age limit dictated by the law before.

However, NSSF Managing Director, Richard Byarugaba warned today that allowing savers to withdraw money at that age will be a disservice to them as the money will not fulfill its purpose of guaranteeing a comfortable retirement plan for the members.

According to research that was done by NSSF in 2017, 98% of the retirement beneficiaries waste away their benefits in the first two years which affects their old age.

“At 45 years, a person still has a lot of responsibilities like school fees, health bills and other nonprofit expenditures. These should be catered for by the 95% of your salary. The 5% of the money you save with NSSF is for your retirement” he said.

Byarugaba noted that most of the members that want to access their funds have not planned properly for their retirement benefits and where they intend to invest in that will give them lasting returns with less Labour input

This was during the NSSF Money talk conference held at Serena hotel on Monday. The conference was aimed at empowering Ugandans in financial literacy and on how to make legit investments that give returns.

Kenya’s Pius Muchiri, Managing Director Nabo Capital who made a key note address on achieving financial freedom advised Ugandans to focus more on creating investments that can offer them passive income instead of depending on active income from monthly salaries.

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“1% of the richest people in the world do not depend on salaries to cater for their immediate needs. They have made investments that bring in money even without any input from the investors. These may include rentals dividends, capital markets shares, bonds among others,” he said

Keith Kalyegira, the Capital Markets Authority Chief Executive Director advertised the attendees to be aware of fraudsters as they go about investing in capital markets and also to always seek out the advice of professional financial advisers before they make investment decisions

“There are investments that are high risk but give high returns while others are low risk but also give low returns. Making an investment decision varies depending on someone’s income and age” he said

 

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