Low pension coverage and frequent job changes are preventing many Namibians from accumulating sufficient retirement savings, increasing long-term financial vulnerability, industry experts have warned.
Speaking at the Investment Destination Breakfast Seminar, Bianca Schmidt, Head of Individual Client Consulting at Alexforbes, said structural challenges in savings behaviour and labour market dynamics are weakening retirement preparedness across much of the population.
“Low pension coverage and frequent job changes prevent many Namibians from accumulating adequate retirement savings, increasing long-term vulnerability,” Schmidt said.
She explained that these challenges are unfolding against the backdrop of Namibia’s youthful demographic profile. With a median age of below 22 and a dependency ratio of 62%, household finances are under pressure, even as the country holds a potential long-term advantage if young people are supported to save and invest early.
According to Schmidt, Namibia’s large youth population provides a long investment horizon, allowing individuals more time to prepare for retirement and participate in equities and diversified investment structures that can improve long-term financial outcomes.
“This youth population gives Namibia a long investment horizon, but without structured guidance, many young people risk inadequate retirement preparation,” she said.
She added that a broad contributor base could strengthen the sustainability and flexibility of retirement and savings schemes, while also creating an opportunity to embed financial literacy at an early stage of life.
“There is a significant opportunity for financial literacy, enabling young Namibians to develop healthy savings habits from an early age. Young people are also receptive to innovation, particularly technology, which can facilitate savings and investment,” Schmidt noted.
However, she cautioned that this demographic advantage presents only a limited window of opportunity. Without proactive financial education, accessible retirement products and supportive policy interventions, many young Namibians may enter adulthood without adequate financial planning, increasing the risk of future financial hardship.
Schmidt highlighted clear differences in savings behaviour across age groups. Individuals over 65 tend to favour traditional retirement and insurance products, while those aged between 25 and 64 primarily rely on retirement schemes and stockvel-type savings arrangements. Meanwhile, younger adults aged 18 to 24 increasingly gravitate towards digital wallets and technology-driven financial tools.
“The 25 to 64 age group, which constitutes the majority of the population, prefers retirement schemes and stockvels. Their main challenges include managing debt, lack of emergency funds and limited financial literacy. Despite general education, many still do not understand the basics of financial planning,” she said.
Across all demographic groups, gaps in financial literacy and limited access to suitable retirement products remain key barriers to building adequate savings.
Also addressing the seminar, Alexforbes Senior Planner Angelica Kriel said investor behaviour has shifted significantly over the past decade, driven by increased digital access to financial information and the growing use of artificial intelligence tools.
“There is a clear divide emerging between disciplined investors and those who react emotionally to market volatility, and discipline remains central to long-term portfolio performance,” Kriel said.
She noted that while improved access to information has enhanced investor awareness and cost sensitivity, it has also contributed to heightened risk aversion and, in some cases, investor overconfidence.
Kriel added that investors are increasingly prioritising diversification, capital preservation and income generation, particularly in a higher interest rate environment, with risk-adjusted returns guiding allocation decisions in Namibia and across broader African markets.
