A 2023 Deloitte Gen z and Millennials survey describes millennials as an experiential generation who spends their hard-earned money with no consideration for the future despite the rising cost of living. For this group it is easy to overlook the value of savings and investments while being surrounded by available instant gratification options.
It is every millennial’s dream to live a comfortable and financially secure life. However, the question that remains is why most people in this generation are unable to save or invest? A big proportion of millennials find themselves believing in instant gratification living by cliché slogans like ‘You Only Live Once’ (YOLO).
However, according to the 2019 census data by Kenya National Bureau of Statistics the dependency ratio is at 70 per cent. This means, among 10 individuals, seven are dependent while two are working majority being millennials.
Saving and investing are powerful tools for economic transformation and crucial to attaining financial freedom. Even with the high dependency rate and the uncertain economic conditions, it is important for millennials to know that it is not late to start planning for their future. Savings provide a safety net for the unexpected such as a medical emergency or job loss while investing works better the earlier you start.
There is an array of investment and savings options available for the millennials especially in the insurance industry Financial advisors need to offer financial literacy on these options to ensure Kenya’s millennials achieve financial security.
As millennials, we need to diversify our investment options and CIC Asset Management (CICAM) is a great place to start. CICAM runs collective investment schemes and pension products offered in the Kenyan market. Some of the investment options offered by the company are:
- Money Market fund- A low risk investment that preserves your capital while earning an interest.
- Fixed Income fund -A high return, moderate risk investment suitable for investors seeking a reasonable level of current income and a steady growth of their capital.
- Balanced Fund- This is a medium risk fund that seeks to achieve a reasonable level of current income and offers investors long-term capital growth. This fund is ideal for investors looking for a mixture of safety, income, and capital appreciation.
- Equity Fund -It is designed for investors seeking long term capital growth and can manage high risk. With this fund, investors seek to create an asset base that offers capital appreciation over a medium to long term period seeking superior returns and a higher tolerance for fluctuations of the investment value.
- Income Drawdown- It is ideal for someone who wants to access their retirement benefits as a regular income through an investment fund from which retirement benefits payments are given.
- CIC Dollar Fund- It is a low risk investment that preserves capital while earning an interest for investors who have dollars.
