The latest Old Mutual Financial Services Monitor 2024 report reveals a concerning financial landscape for working Kenyans. Despite economic struggles, many remain resilient, adapting strategies to secure their financial well-being.
Financial Challenges Increase Among Kenyans
The report highlights that financial stress is mounting. Almost 80% of working Kenyans report earning the same or less than the previous year, making it difficult to manage household expenses. The high cost of living, increasing taxes, and business downturns are the primary reasons for low economic confidence.
Kenyans are responding by cutting expenses, budgeting carefully, and seeking alternative income sources such as side businesses. Yet, borrowing remains a widespread coping mechanism, with many turning to loans from financial groups, friends, and mobile lending platforms to stay afloat.
Financial Planning and Priorities
Income security remains the top financial priority, with 51% of working Kenyans worried about job losses. Additionally, cutting expenses and securing investments rank high among financial goals. More consumers prioritize savings for their families’ future, medical coverage, and retirement planning.
Financial Stress and Dependency
The report indicates that 47% of Kenyans experience financial stress, which affects their mental and physical health. Many people find themselves in the “sandwich generation,” responsible for the care of both their children and aging parents or other adult dependents. This dual responsibility often leads to increased financial strain. Approximately 48% of respondents fall into this category, with a significant gender gap—52% of women versus 44% of men.
Entrepreneurship and Financial Resilience
Despite economic hardships, Kenya’s entrepreneurial spirit remains strong. About 50% of working Kenyans own businesses, and 20% engage in side hustles to supplement their income. However, financial pressure has forced 41% of business owners to borrow money to sustain operations.
Access to formal financing remains limited. Most business owners rely on personal savings, reinvested profits, or community savings groups (Chamas) instead of banks and microfinance institutions. The report emphasizes the need for better access to structured financial solutions.
Optimism for the Future
Despite financial hardships, six in ten working Kenyans expect their financial situation to improve within six months. Many anticipate better job opportunities, business expansion, and increased savings and investments. Proper budgeting and disciplined financial planning are among the strategies individuals use to navigate these difficult times.
The report highlights a critical need for financial literacy and professional financial advice. Kenyans can improve their financial stability and long-term prosperity by adopting structured saving strategies and reducing reliance on debt. The Kenyan economic future depends on empowering individuals with the right tools and knowledge to secure their financial well-being.