A new report by Old Mutual reveals that 70% of Kenyans have seen their incomes decline in 2024, with 47% experiencing significant stress affecting their physical and mental health.
The Old Mutual Financial Services Monitor (OMFSM) 2024, launched in Nairobi, examines the financial wellbeing of employed Kenyans aged 20 to 59 in urban and peri-urban areas.
It highlights growing financial insecurity, with many Kenyans losing confidence in the economy due to rising living costs, high taxes, food price increases, and unemployment.
Only 30% of households consistently cover their expenses with money left over, forcing many to cut costs by downsizing, switching to cheaper brands, moving children to affordable schools, and reducing non-essential spending like entertainment and travel.
To cope, many Kenyans are turning to entrepreneurship.
The report shows that 50% of Kenyans now own a business, but only 30% of these businesses are formally registered, and just 16% have insurance, leaving them vulnerable.
Most rely on personal savings, business profits, and savings groups (Chamas) for funding.Despite financial struggles, 85% of Kenyans acknowledge the importance of saving for retirement.
However, confidence in having enough for retirement has dropped from 12% in 2023 to just 7% in 2024.
Many rely on employer pension schemes, savings groups, and personal investments.
Anthony Mwithiga, Group Managing Director at Old Mutual Investment Group, noted that more Kenyans are shifting to the informal economy.
“People are starting small businesses and offering services like tutoring and food delivery, often bypassing formal employment,” he said.
The report highlights the urgent need for economic stability and financial planning as Kenyans find innovative ways to navigate tough economic times.
