PERSONAL FINANCE: How to grow your money from as little as Sh3000

The modern day Kenyan youth needs a wakeup call. Life as a youth these days is occupied with party after party and very little regard for savings and other such boring things.

Unfortunately, we don’t live in our parents’ times when they had a variety of opportunities at their disposal, like being paid to go to school and after graduation find a well-paying job waiting eagerly for them. Theirs was a matter of choice if you wanted to succeed or not.

Well, everything is changed, you have to struggle and work hard and smart to set yourself a bar ahead of from peers. It is very common for us to live ordinary lives, hence the need to be smart with the choices we make daily, to better our lives.

The modern day youth is distracted by things that clearly do not matter; we want to live life for today without thinking about the future, ‘YOLO’ as they call it, meaning ‘you only live once’. Just as, Stephen R. Covey the Author of Seven habits of highly effective people notes in his book, “Reactive people focus their efforts in the circle of concern; They focus on the weakness of other people, the problems in the environment and circumstances over which they have no control”.

We are selfish in nature always wanting ‘things’ only for ourselves without considering our children tomorrow. We lack ambition to better our lives and are generally lazy affected by the syndrome of ‘serikari tafadhali saidia’ we want everything we desire handed to us. Until when will we wait for our guardians to provide for us, even after completing school? I have grabbed the bull by the horns, not because I think we are a lost cause but because I know we have good chances to turn our lives around for the better.

Currently there are numerous opportunities for us to take advantage of in the financial world.

For instance, the government of Kenya today is very keen on bettering the lives of the youth. However, this will not be handed to us on a sliver platter.

We have to take the mantle and make the choice to better our lives for ourselves.

Currently, the government, through the Central bank of Kenya, is planning on floating a Sh5 billion bond to be traded through mobile phones making it very accessible. This is a great savings plan for the youth to consider as they can bid for us low as Sh3000 for the income tax free bond.

This new investment plan is called ‘save money, make money, build Kenya’. In other words, this is a way for the government to borrow funds from the public at an attractive rate of return annually. I vouch for this product because apart from being very secure and risk free, it offers a rate of return you will never receive from the financial institutions by saving your money with them.

As much as we are urged to save our money in the bank, I will be the first person admit that I am against letting your money sit idle at the bank in the name of saving.

This is self explanatory as the money is just idle hence does not help you much in future because of the time value of money.

Why not save in a savings plan that offers a rate of return after a period of time, usually one year? I am talking about unit trusts. These are mutual funds or collective schemes brought together from different groups and invested in one product. Today they are a great number of financial institutions offering this investment plan; OLD MUTUAL KENYA, for instance.

The youth can consider investing in these investment plans by remitting from as low as Sh2,000 a month for a considerable indicative rate of return ranging between 8 per cent – 20 per cent depending on the product invested in.

I believe the question is not whether there are available opportunities for the youth to invest in, but whether they are willing to participate?

Having a background in financial advisory, I can testify that these plans can change an individual’s financial security and teach and instill discipline. Individuals are able to plan for their future plans; buying a house, buying a car and starting an income generating business to mention but a few.

Well, the time is now for the youth to learn to be financially independent and secure for the future.

Most importantly we ought to be creative and innovative enough to find sustainable ways to better our lives and make the world a better place of living, for us and for the future generations.

Let us think about that for a change.

By Kawira Mutegi