Building solid savings habits goes hand in hand with developing a savings culture. It doesn’t matter how much income you make. You must train yourself to save something for each pay period.
In late July 2021, an analysis by EFG Hermes revealed that Kenyans save the least in East Africa and the saving rate is below the continent’s average.
The analysis showed that Kenya’s saving rate is at 12 percent, way below Africa’s average of 17 percent.
This is half the average for low-income countries (26 percent of GDP). By contrast, neighboring Uganda and Tanzania have already crossed the 20 percent mark even though their per capita income is significantly lower.
According to the report, Kenya’s poor saving culture to high spending power. Also, many people can’t save because they have recurrent bills to save, and this is the reason why Kenyans work hard every single day to earn money to cover their expenses and build a brighter future for themselves and their families – something that is seemingly a perpetual endeavor.
No matter how exhausting their job becomes, they can’t quit because they wouldn’t cover their bills. Now for a better life in the years to come, and to ensure that you don’t keep wondering whether you were born to pay bills and die, you have to save up.
The big question, however, is, how can you build a culture of savings? To make things seem more natural, it would be wise to cultivate a culture of saving.
Do it at home, at work, or wherever AND whenever possible. If you can, get other people involved, especially in your household where you have more control of your finances.
To better help you understand how to develop an innovative culture of saving, it is only fair that we understand what the term means. It is different from investing – but one can lead to the other. But it begins with saving.
A saving culture is a type of mentality. Many people don’t save because they think they don’t have enough to save.
The meaning of a savings culture is to discipline yourself into saving money regularly. Over time, your saving culture will lead to building wealth, through investments. At this point, when you have a substantial reserve of money that has enabled you to invest in a lucrative business, you will start feeling like you are living an abundant life.
To cultivate a saving culture, you must develop consistent saving habits in your life. These practices are so engrained into how you move through life that they become second nature to you.
Often, we trick ourselves into believing that we will start saving more money when we finally:
Well, not to rain on your parade, but you will never have enough money to start saving. No matter how hard you try, and therein lies the reason why you need a culture of savings.
Building solid savings habits goes hand in hand with developing a savings culture. It doesn’t matter how much income you make. You must train yourself to save something for each pay period. Then, over time you can increase your savings percentage.
We all have goals. This objective should drive you to save. Of course, the hardest part is starting it, and growing your savings may sound too overwhelming. Too much adulting for our dear millennials, and boring for the much younger ones.
So, list down your goals for building a fund and commit to it. If you’ve never made a money goal before, then you must learn how to make your money goal and create your first money vision board.
Have a strong motivation for why you’re saving money. Ask yourself, what your priorities are – it could be a need to move to a bigger house or maybe you want to start your retirement fund earlier. If you have a bucket list, consult it to see how many items you can achieve if you have enough funds in your savings account.
Always keep in mind the goals that will make saving a sweet journey rather than a complete pain in the head.
Look around and see how you are managing money. To help you take a financial assessment, ask yourself:
Answers to these questions will help guide you on what you need to do in order to take that next step towards building wealth. For example, a budget is making a plan for your money. Plain and simple. No need to get fancy here.
For many folks, their salary comes and goes without even making it to their wallets – they only realize so after checking their statements later on. This is the hard truth for many people. They tend to forget to set aside a portion of it because of overlapping payables and unexpected expenses.
To overcome this challenge, automate your savings by turning them into a habit. You must wholeheartedly set aside a specific amount that MUST go to your savings regardless of your responsibilities. Try this one.
Set up an automatic transfer from your checking account to your savings account if you don’t have it yet, then it’s time to open one. This is a great option. Thank me later
There is no specific amount to save. It all entirely depends on you, but remember, the more you save, the better your reserves. Determine how much you can save every time you receive your pay.
To be realistic, maybe you can start small. Taking baby steps and watching your fund grow is better than feeding your account with a huge amount for the first few months and then fail to continue. Over time, you can continue to increase the amount you save regularly.
Putting your eyes on the prize may be easy, or not. It really depends on how badly you want it. Committing to your end goal means you will do whatever it takes to religiously set aside an amount to grow your fund.
If it helps, reward yourself every time you save. Enjoy a pampering foot soak or watch the sunset. The reward does not always have to be a material thing. It could be anything that makes you smile or feel happy about.
When you do this more often, saving money will gradually become fulfilling.