Online Reporter
Nick Mangwana-Government Up Close
Written on the sidelines of the Public Service Commission’s National Retirement Planning Conference in Bulawayo.
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MY first cousin had done everything right. For over three decades, he served a major mining company, climbing the ranks to a senior management position. He was the epitome of diligence, contributing faithfully to what was considered a decent and reliable company pension fund.
When he finally retired, it was with the well-earned expectation that his years of toil would now pay back, cushioning his golden years with well-deserved rest. He had retired at what should have been the moment of his greatest financial security. Instead, he retired at the worst possible time: the peak of Zimbabwe’s hyperinflation.
Almost overnight, the value of his lifetime of savings was utterly wiped out. The system he had trusted implicitly had failed him.
Today, he is 83 years old, an octogenarian who should be enjoying his legacy. Instead, he has relocated to the United Kingdom, where he still works odd jobs to make ends meet.
His story is the very reason why initiatives like the ongoing Public Service Commission (PSC) National Retirement Planning Conference in Bulawayo are not just commendable but essential.
Under the apt theme of “Securing Dignity Beyond Service: Building Resilient Retirement Futures,” this conference represents a crucial national conversation. It is a powerful and welcome awareness move that brings the issue of retirement planning from the shadows of anxiety into the light of proactive strategy.
We must applaud the PSC for taking this leadership role.
This shift in mindset at a national level has been ably championed by the PSC Chairperson, Dr Vincent Hungwe.
Under his stewardship, the Commission has undertaken the critical task of moving public service pensions from a vulnerable pay-as-you-go model to a more sustainable and secure system.
Dr Hungwe’s leadership has been pivotal in wisely investing workers’ pension contributions, building a tangible asset portfolio designed to withstand economic fluctuations and protect the value of civil servants’ futures. This strategic move from a passive system to an active, growth-oriented one is a monumental step in restoring the trust that was so brutally broken during the hyperinflation era.
The Silent Leak: When Bank Savings Erode Instead of Grow
However, for the average Zimbabwean trying to save, a formidable modern-day challenge persists—one that inadvertently punishes the act of saving itself. In most parts of the world, the fundamental principle of banking is that your money grows, however modestly, when deposited.
Interest accrues, encouraging citizens to save. In our context, we face an anomalous and deeply discouraging reality: leaving money in a bank account often leads to a gradual but sure erosion of value through a barrage of monthly maintenance fees, transaction charges and other levies.
Your balance doesn’t increase; it decreases simply for the privilege of being in the system.
This reality poses a significant psychological and practical barrier.
When citizens see their hard-earned savings slowly nibbled away by charges, it reinforces the traumatic lesson from the hyperinflation era: the system is designed to work against you. It actively discourages the very culture of formal saving we are trying to promote.
We must admonish this status quo. Our financial service providers, who should be the chief architects of a savings culture, are often inadvertently its greatest underminers.
There is an urgent need for innovative, low-cost savings products that protect the nominal value of deposits as an absolute minimum. The journey towards a savings culture cannot succeed if the path is paved with charges that make saving a guaranteed loss-making activity.
My cousin’s story is not unique. It is a quiet, gnawing anxiety that lives in the heart of countless Zimbabwean families. We are a generation that witnessed the evaporation of lifetimes of sacrifice.
The trauma of hyperinflation, a period triggered by the severe illegal economic sanctions that crippled our national economy, did not just destroy currency — it shattered a fundamental social contract.
This legacy of loss has bred a dangerous but understandable cynicism.
“Why save?” many ask. “Why plan when it can all be wiped out tomorrow?”
This sentiment is a rational response to an irrational past. Yet, succumbing to it is the greatest risk we can take for our future selves.
The very instability that makes planning feel futile is the precise reason why deliberate, intelligent, and diversified retirement planning is more critical than ever.
The PSC’s approach provides a national model; our personal task is to build our own diversified portfolios that look beyond traditional bank savings. We must acknowledge the pain of the past, but we cannot let it paralyse our future. The journey to a dignified retirement must begin not in the twilight of one’s career but on the very first day one earns a salary.
The Ghosts of Pensions Past: A Nation’s Trauma
To speak of retirement planning in Zimbabwe without first acknowledging the elephant in the room would be an act of profound insensitivity.
The hyperinflation of the 2000s was not merely an economic statistic; it was a personal catastrophe for millions. Hardworking teachers, civil servants, and private sector employees, like my cousin, watched in helpless horror as the value of their pension funds melted into nothingness.
The life savings painstakingly built over 30 or 40 years of work were rendered worthless.
This was a betrayal that cut deep into the national psyche. It was a consequence of a complex interplay of internal economic challenges and the devastating impact of external illegal economic sanctions, which constricted the very arteries of our national financial system.
The result was a collective lesson, seared into our consciousness: that formal systems can fail. This lesson, while born of truth, has mutated into a dangerous fallacy — that all planning is futile. We must reframe this thinking.
The lesson is not to avoid planning but to build diversified plans that are more resilient, diversified, and personally controlled than the systems that failed us before. We cannot change the past, but we can learn from its harsh teachings to navigate the present.
The First Paycheque: The Most Important Investment You’ll Ever Make
The single most powerful asset in retirement planning is not the amount of money but time. For a young person landing their first job, retirement feels like a distant, abstract concept.
The immediate temptations — a new smartphone, better clothes, a more vibrant social life — are palpable and rewarding. The idea of setting aside even a small percentage of that hard-earned money for a day 40 years away seems irrational. Yet, this is the foundational decision upon which financial security is built.
The principle of compound interest, often called the eighth wonder of the world, is the ally of the early starter.
A small, consistent savings habit started at age 25 will exponentially outperform a larger, frantic savings scramble begun at age 45. Imagine two individuals: Tanaka, who starts saving $100 a month at 25, and Blessing, who starts saving $200 a month at 45. Assuming a conservative annual return, by age 65, Tanaka is likely to have a significantly larger nest egg than Blessing, despite contributing less total capital. The early contributions have more time to grow and multiply.
Therefore, the mantra must be: Start the day you start earning. This is not about deprivation; it is about conscious allocation.
Given the reality of our banking environment, this means seeking out options beyond a simple savings account.
This could be through a formal pension scheme (with a careful eye on the fund’s asset-backed security, following the PSC’s example), a voluntary contribution plan, or a personal investment in assets that historically preserve value.
The act of “paying yourself first” must become as automatic as paying rent. This habit, cultivated early, transforms saving from a burdensome sacrifice into a non-negotiable part of a diversified retirement plan.
The Lump Sum: A Final Harvest, Not a Seed for Grandiose Dreams
One of the most perilous moments in a retiree’s life is the day they receive their retirement lump sum. After decades of modest living, it can feel like a windfall, a jackpot.
This is the moment when decades of disciplined saving can be undone in a few impulsive decisions. There is a powerful, often cultural, pressure to use this money to “show” success — to build a large, imposing house in the rural home, to buy a luxury vehicle, or to fund a grandiose business venture.
This is a catastrophic error. The retirement lump sum is not a reward for past suffering; it is the capital that must fund your future survival.
It is your final harvest, the food that must last you through a winter that could be 20 or 30 years long.
Unlike in your 30s, if you lose this capital in a failed business venture or sink it into a non-income-generating asset like an oversized house, you have no capacity to go back to work and earn it back.
Your productive years are behind you. The learning curve for a new business is steep and unforgiving, and failure at this stage is not a lesson; it is a life sentence to poverty and dependency.
The lump sum must be treated with sacred reverence. Its primary purpose within a diversified retirement plan is to generate a steady, reliable stream of passive income.
This means investing it conservatively in instruments that preserve capital and provide returns — whether in inflation-resistant assets, carefully selected dividend-paying stocks, or rental properties. The goal is not to become spectacularly rich with the lump sum; it is to ensure it never runs out.
A Special Word for the SME Titans: Building Your Own Pension Fund
For the entrepreneurs, the vendors, the artisanal miners, and the shop owners who form the vibrant backbone of Zimbabwe’s SME sector, the concept of a formal pension is often alien.
Your business is your pension — or so the thinking goes. The danger here is that the line between business capital and personal savings is perpetually blurred.
A bad month in the business can mean no savings that month. The business itself, while an asset, may have no value without your daily presence.
SME owners must be even more disciplined in architecting their diversified retirement. Here’s how:
Pay Yourself a Formal Salary: Even if you are the sole proprietor, formalise a modest but consistent salary for yourself. This separates your personal living costs from your business cash flow. From this “salary,” commit to a monthly savings or investment plan, just as a formal employee would.
Build a Parallel Retirement Asset: Do not rely solely on the sale of your business for retirement.
Systematically build a separate investment portfolio. This could be through purchasing residential stands for future value appreciation, buying stocks in more established companies, or contributing to a micro-investment platform. The key is that this asset is untouchable for business re-capitalisation.
Plan Your Business Exit Strategy: Think of your business as a product you will one day sell. Systematise its operations so it can run without your constant, direct involvement. This makes it a sellable asset. A business that is entirely dependent on the owner has no retirement value.
Embrace Formalisation: Where possible, take steps to formalise your business operations. This not only opens doors to larger contracts but can also allow you to participate in formal pension and insurance schemes designed for the self-employed.
A Call to Conscious Action: Reclaiming Control
The scars of our economic history are real, and the fear they instil is valid. The story of my cousin, a capable man now working odd jobs in his eighties, is a stark reminder of what is at stake. But we must not allow that fear to condemn us to a similar fate.
The solution to systemic failure is not individual surrender but personal resilience. The PSC conference in Bulawayo and the strategic reforms under Dr Hungwe light a path.
By starting early, respecting the power of time, embracing diversification beyond eroding bank balances, and treating our retirement capital as the life-sustaining resource it is, we can build a buffer against uncertainty.
We must learn from the past without being held hostage by it. The old model of relying solely on a single pension fund has failed.
The new model is one of multi-pronged, personal responsibility: a combination of formal schemes, personal investments, and income-generating assets, all nurtured over a lifetime — a truly diversified retirement plan. It is a quieter, less grandiose path than building a mansion with your lump sum, but it leads to a far more valuable destination: financial independence and peace of mind.
Let us honour the struggles of those, like my cousin, not by repeating the cycle of despair but by learning from their losses and forging a new, smarter path for ourselves.
Let our sunset years be defined not by anxiety and want but by the dignity and security that comes from a plan well executed. The time to plant that tree is today.
Nick Mangwana is the Permanent Secretary for Information, Publicity and Broadcasting Services
