Land and real estate comprise the largest assets where working age Kenyans invest for retirement, a survey has shown.
However, it says there is a gradual change in the composition of investment portfolio.
The findings are contained in a report released by financial services provider Enwealth in partnership with Strathmore University and the Institute of Human Resource Management (IHRM) last week.
There is reduction of assets invested in business ventures for those nearing retirement in the age group of 51 to 60, according to the report.
There is also an increase in investment in financial instruments in the same age-group.
The report says this demonstrates the need to include investment information when providing financial literacy to ensure the asset allocation process is aligned with the risk profile.
It says that in the case of the age group, the allocation to immovable assets falls slightly, but still accounts for more than 50 per cent of investments.
“An easy-to-remember rule of thumb is that your fixed income allocation should be equal to your age.
So, if the member is in 20s and 30s, keep no more than 70 per cent in equities and the rest in fixed income assets.
Mid-career professionals in their 40s and 50s should have between 50 to 60 per cent in equities, while retirees who need regular income should start reducing their equity exposure to around 30 per cent,” the report recommends.
It also shows that 85.4 per cent of working Kenyans fear their savings may not be enough to cater for post-retirement life.
It adds that the average Kenyan may not be able to meet expenses solely on retirement income saved in a pension scheme.