The Financial Blind Spots of Humanitarian Life

The Financial Blind Spots of Humanitarian Life

Tahir Ali Shah

This article is adapted and contextualized from ideas originally explored by Anthony Pusatory, Founder of The Seven Pillars. I have expanded the discussion to reflect the realities of Pakistani and globally mobile humanitarian professionals.

Most of us entered humanitarian work because we care deeply about impact. We think about vulnerable communities, program design, donor compliance, and field realities. What we rarely think about, at least not seriously, is our own long-term financial stability. We save when we can. Some of us invest in property. Some open savings accounts. A few contribute to formal pension schemes. But very few of us step back and ask a hard question: if my contract ends tomorrow, or if I reach retirement age, am I genuinely prepared?

Humanitarian careers are structurally different from stable domestic employment. Contracts are temporary. Funding cycles are uncertain. We move cities and countries. Benefits appear generous while they last, and then disappear completely. Because transitions are normal in our sector, financial gaps quietly accumulate in the background. They remain invisible until a crisis forces them into view.

The first blind spot concerns pensions and retirement contributions. Retirement always feels distant, especially when you are negotiating your next posting or managing an emergency response. But pension systems are mathematical. They reward continuous contribution and penalize gaps. In Pakistan, many private-sector employees are covered under the Employees’ Old-Age Benefits Institution, commonly known as EOBI. The idea behind EOBI is simple: both employer and employee contribute during working years so that a monthly pension becomes available after reaching retirement age, currently set at sixty for men and fifty-five for women under existing rules. On paper, this provides a safety net.

In practice, however, many humanitarian professionals fall into grey areas. Some organizations register staff under EOBI; others do not. International NGOs sometimes operate through arrangements where EOBI compliance is unclear. Short-term contracts, consultancies, and project-based hiring often mean contributions are inconsistent. Years can pass without proper registration or contribution tracking. Because the monthly deductions seem small and retirement seems far away, few people check whether their EOBI contributions are actually being recorded.

This is where the danger lies. Pension systems, whether EOBI in Pakistan or social security systems abroad, depend on consistent contributions over time. Missing years reduce benefits. In some cases, insufficient contribution years may affect eligibility altogether. Many professionals assume that because they have worked for reputable organizations, their pension records must be in order. That assumption needs verification. It is important to confirm whether your employer is registered with EOBI, whether your contributions are being deposited, and how many contribution years are recorded in your name.

For those who have worked internationally, the situation becomes more complicated. Time spent abroad often means no contribution to the Pakistani pension systems at all. When you return home after ten or fifteen years overseas, you may discover that your official pension record shows only a handful of contributing years. At that stage, rebuilding the required years becomes difficult. The earlier you check, the more options you have. The later you check, the fewer choices remain.

The second blind spot involves taxes, international income, and retirement savings. Humanitarian professionals frequently work across jurisdictions. Some earn in dollars, others in euros or local currencies. Some pay income tax locally; others operate under tax-exempt arrangements depending on the host country and contract structure. These complexities create room for misunderstanding.

For example, Pakistani professionals working abroad may assume that because they are paying tax in another country, their long-term retirement structure is secure. In reality, paying tax somewhere does not automatically build pension rights in Pakistan. Conversely, if income is structured in a way that minimizes taxation, retirement contribution opportunities may also be reduced. The principle is consistent across systems: tax incentives and pension benefits are usually connected to taxable income. When income falls outside a national tax base, associated retirement benefits often disappear as well.

Many professionals choose arrangements that reduce their immediate tax burden. That is a natural instinct. If you can legally reduce taxes today, it feels like a smart decision. But without long-term comparison, it is incomplete thinking. Saving money today while weakening retirement accumulation tomorrow may not be optimal. The correct choice depends on income level, family situation, retirement plans, and future country of residence. The problem is not choosing one strategy over another; the problem is choosing without running the numbers.

This is particularly relevant for those who oscillate between Pakistan and overseas assignments. You may spend five years abroad, then return for two years under a local contract, then leave again. Each transition affects pension contributions, tax status, and savings structure. Without deliberate tracking, the overall picture becomes fragmented. A fragmented career often produces a fragmented retirement.

The third blind spot concerns what I call the “freedom fund.” Traditional financial advice recommends saving three to six months of expenses as an emergency fund. That advice works for someone in stable employment with predictable benefits. It is rarely sufficient for humanitarian professionals.

Consider how compensation packages in our sector are structured. Your contract may include housing, health insurance, education allowance for children, transport, and hardship allowances. These benefits become normal. You stop thinking about them because they are automatically provided. But the moment your contract ends, they vanish. If you calculate your emergency savings based only on your take-home salary, you are underestimating your real exposure.

Imagine earning the equivalent of six thousand dollars per month, while your organization also covers accommodation worth two thousand dollars, health insurance, and schooling support. If the contract ends, your actual monthly cost does not remain six thousand; it may jump to ten or twelve thousand when you must pay everything independently. A six-month fund based only on salary might look comfortable on paper, but it could evaporate quickly once real expenses surface.

For Pakistani professionals returning home after international assignments, additional transition costs arise. There may be relocation expenses, temporary housing, children’s school admissions, furniture purchases, vehicle arrangements, and medical coverage gaps. These are not rare events; they are common during career transitions. Yet most people do not budget for them because they are easier to ignore while income is steady.

A more realistic approach for humanitarian professionals is to maintain six to twelve months of true living expenses, not just salary-based calculations. This fund should be liquid and stable. It should not depend on stock market performance. Emergency savings are meant to buy time and preserve dignity during transitions. They provide the freedom to reject unsuitable offers and wait for the right opportunity instead of accepting the first available contract out of financial pressure.

Underlying all three blind spots is a cultural issue within our sector. We are comfortable discussing budgets for communities but uncomfortable discussing personal finances. There is an unspoken belief that focusing on our own financial security appears selfish. In reality, it is responsible. Financial fragility makes professionals vulnerable. It increases the likelihood of burnout, poor decisions, and ethical compromise. Stability, on the other hand, strengthens independence and integrity.

In Pakistan, where formal social safety nets are limited and family systems are often expected to fill gaps, the need for personal financial planning is even greater. EOBI pensions are modest and may not sustain a middle-class lifestyle independently. Relying solely on future family support is uncertain. Property investments may help, but they are illiquid and subject to market fluctuations. Diversified savings, documented pension contributions, and deliberate retirement planning are not luxuries; they are necessities.

The core message is not fear. It is awareness. Pension gaps can be addressed if identified early. Tax strategies can be reviewed and optimized. Emergency funds can be gradually built. None of these actions require extraordinary financial expertise. They require attention and honesty.

If you work in the humanitarian sector from Pakistan or abroad, take three practical steps. Verify your EOBI registration and contribution history if you are employed locally. Review how your international contracts affect your pension and tax position. Calculate your true monthly burn rate, including benefits you currently receive from your employer. These exercises may feel uncomfortable, but they transform uncertainty into clarity.

I began this article thinking I would share guidance. I end it recognizing that financial literacy in humanitarian life is not a one-time lesson. It is an ongoing responsibility. Our careers are built on service, mobility, and adaptation. Our financial systems, however, are rigid and rule-based. Bridging that gap requires deliberate effort.

Serving others sustainably requires that we ourselves remain stable. Financial awareness does not reduce our commitment to humanitarian values; it strengthens our ability to uphold them over the long term.

The author has worked for more than three decades in humanitarian and development contexts across conflict and crisis-affected settings, with experience in senior leadership, program management, and advisory roles. tshaha@gmail.com