Ghana’s National Pensions Regulatory Authority (NPRA) has called on citizens to actively enroll in voluntary Tier 3 pension schemes to bolster retirement savings amid concerns over the adequacy of the country’s mandatory pension system.
Speaking at the 2025 B&FT–Ecobank Money Summit, NPRA CEO Christopher Boadi-Mensah emphasized that reliance solely on compulsory Tiers 1 and 2 pensions risks leaving retirees without sufficient income in their later years.
“Our current two-tier system provides a foundation but cannot guarantee a dignified retirement. Tier 3 exists to empower individuals to take control of their futures through voluntary, tax-incentivized savings,” Boadi-Mensah stated. Under Ghana’s pension structure, Tier 1 is managed by the Social Security and National Insurance Trust (SSNIT), while Tier 2 involves privately managed corporate schemes. Tier 3, however, allows both formal and informal workers to make additional contributions, yet participation remains low due to its optional nature.
The appeal comes as rising living costs, longer life expectancy, and a large informal workforce strain traditional retirement models. Nearly 85% of Ghana’s labor force operates outside formal employment, limiting access to employer-backed pension plans. Boadi-Mensah argued that shifting perceptions of Tier 3 from an “optional extra” to a critical investment strategy is essential. “Retirement planning isn’t a luxury it’s a necessity. Delaying voluntary savings jeopardizes financial stability when earning capacity declines,” he added.
The NPRA’s push aligns with broader efforts to strengthen Ghana’s domestic savings pool, which remains below the sub-Saharan African average of 17% of GDP. Increased participation in Tier 3 could channel more capital into local markets, supporting infrastructure and business growth. Financial institutions and employers are urged to educate clients and employees on the scheme’s benefits, including tax deductions of up to 16.5% on contributions.
Despite these incentives, uptake has been sluggish. Analysts cite low financial literacy, distrust in pension systems, and immediate economic pressures as barriers. The NPRA plans to collaborate with stakeholders to simplify enrollment and expand outreach to informal workers, who represent a critical yet underserved demographic.
The call to action reflects global trends where aging populations and shifting employment patterns force reforms to retirement frameworks. For Ghana, fostering a culture of proactive savings could mitigate future fiscal pressures while empowering individuals to retire with “peace of mind and purpose,” as Boadi-Mensah noted.
As the government explores reforms to enhance pension inclusivity, the success of Tier 3 may hinge on addressing systemic challenges from improving trust in financial institutions to tailoring products for gig workers and rural populations. With nearly 60% of Ghanaians lacking pension coverage, the urgency for scalable, flexible solutions has never been greater.
