Ihave written about individual retirement plans and why they are important for your personal finance success journey. Contributions are tax deductible up to Kes. 20,000 per month and earn compounding interest. In addition, there is flexibility in terms of contributions and portability if you need to move to another provider. 

While these are excellent avenues for self-employed individuals and anyone in the informal sector, an individual retirement plan can also come in handy if you are employed. It allows you to consolidate contributions from your employer’s scheme. Imagine the headache of managing and following your pension contributions with previous employer schemes. Too hectic! 

Most importantly, an individual retirement plan ensures you have more than your NSSF contributions during retirement. Which are not much, to be honest. NSSF’s contributions are low. Worse, the interest returns are much lower than what individual plans from private institutions provide. Now, let’s talk about providers to consider.

Related read Retirement Planning: Why I am Counting On More Than My NSSF

Pension Plan vs. Provident Plan

When getting an individual retirement plan, you will be asked to settle for either a pension or a provident plan. Understanding these two is crucial as it affects your retirement fund payout. 

• A pension plan only pays one-third of your accumulated benefits as a lump sum. The rest, two-thirds, must be put in either an annuity or income draw-down
• On the other hand, a provident fund pays out all your accumulated retirement savings and interest as a lump sum. However, if you do not want to take out all the money, you have the option of purchasing an income drow-down or an annuity with the money. 

Top Individual Retirement Plans in Kenya to Consider

There are numerous providers. Whichever provider you settle for, ensure they are registered and regulated by Retirement Benefits Authority. Other features to look at include the minimum guaranteed return, the flexibility of contributions, and portability in case you ever want to move your contributions to a different provider in the future. 

The below-recommended providers are registered by RBA. So, without further ado, and in no particular order, here are some companies to consider:

Related post: Individual Retirement Plans vs. Life Insurance Policy; What You Need to Know

1. Britam Individual Retirement Plan

Britam offers individual retirement plans with the option of either a pension or a provident fund. The returns are decent, with the last interest for 2021 being 10%. The key features of its plan include:

• A guaranteed return of 5% p.a. 
• A low minimum contribution amount of Kes 500.00 per month
• Your employer can contribute directly 
• Varied contributions with a minimum of Kes. 2,000 per frequency 

I have started with Britam because I am currently using it for my IPP. Besides the above key features, one of the things I love about them is the ease of access to my account. You can either log in to your customer account through their app or online. This gives you access to all your financial products, including life insurance and home policies. That includes the ability to download your statements and make payments and withdrawals. Second, there are several ways to top up your contributions, from Mpesa to direct bank transfers and debit cards. Your withdrawals are also processed fast — if ever it gets to this.  

On the downside, there are times when the app or their online portal are not available. It is not that often, but when it happens, it takes days before you can access your account using either of the methods. 

2. ICEA Lion Personal Retirement Scheme

ICEA’s personal retirement scheme has both a provident and a pension fund. The fund has had some decent returns over the years. For example, the last recent return of 2021 was 9.25%. The key features to note are:

• Minimum guaranteed interest return of 4% p.a
• A minimum monthly contribution of Kes. 1,000
• Flexible contributions, monthly, quarterly, semi-annually, or annually, as long as your minimum monthly contribution is Kes. 1,000
• Several contribution methods, including Mpesa, bank transfer, or salary deduction 

3. Jubilee Personal Pension Plan

Jubilee’s Personal Pension Plan is another option to consider. The returns are also decent, with the most available details showing an interest return of 10% in 2019 and 8.81% in 2020. The fund’s key features are:

• Minimum guaranteed interest return of 4% p.a
• No set-up fee
• Payment of contributions through Mpesa, cheque, cash, or bank
• Flexible contributions, depending on your situation 

While the website is a bit complicated to navigate when looking for information, its personal pension portal is an excellent feature once you locate it. It includes a pension calculator where you can estimate how much you could receive at retirement age based on your current age, contributions frequency, and retirement age. I have also seen there is an online portal for customers. 

4. Octagon Personal Pension Scheme (OPPS)

Octagon Africa’s OPPS is another option. What I like about Octagon is the pension clinic. They do webinars on retirement topics, an excellent way to learn more about retirement planning and life. The plan’s key features are: 

• Minimum guaranteed interest return of 
• No minimum contributions 
• Flexible contributions 
• Several options to pay contributions, including Mpesa and bank transfer
• Online access to your account through a mobile app and online portal 
• Your employer can contribute directly to your OPPS
• Quick processing of your withdrawals 

5. CIC Jipange Plus Personal Pension Plan

Last but not least on my list is CIC Jipange Plus Personal Pension Plan. The key features are:

• Minimum guaranteed interest return of 5% p.a
• A minimum contribution of Kes. 500
• Online customer portal 
• Flexible contributions 
• Allows employer contributions 

I have found the available handbook about the plan quite comprehensive. It makes it easier to learn more about retirement planning and the provider’s plan. Still, it is a bit hard to get more information, especially about previous returns.  

In Conclusion 

The above are just a few examples of providers you can consider. I settled on these primarily because of the availability and ease of access to information. The RBA list of providers is an excellent guide to use as you search for a provider, as it ensures whichever provider you settle for is licensed by the regulator.

Before settling for any company, you must do due diligence. Call the providers, and get all the necessary information, including previous and guaranteed return rates. It also helps to do a Google search. Also, go through reviews and comments on their social media pages. This will help you gauge their customer service.