Friday April 29, marks the beginning of an unprecedented 5-day ‘weekend’ where employees are eligible to stay off work - to mourn the late President Mwai Kibaki Friday, observe Labour Day on Monday, and celebrate Eid al-Fitr on Tuesday May, 3.
Employees will resume work on Wednesday, already mid-week for a 3-day week before jumping into another weekend. It goes without saying, given the nature of Kenyans when confronted with free time, there is going to be a lot of spending these five days - especially on entertainment.
But for you, the financially conscious Kenyan, you are not going to derail your financial goals just because you have free time for enjoyment - you will be hard at work trying to better pave the road to your financial success.
You will also have some fun too but on a budget. The purpose of this article is to help you plan for these five days that you have off work to recharge your financial batteries while still getting some rest. Of these 10 activities to do this weekend, five are purely about financial planning and the other half is all about having fun on a budget.
We are already through one third of the year 2022 - It is probably a great time to take this weekend and refocus your finances. You know, it will be election week when the next one third of the year ends. Where do you want to be financially by then?
We think this weekend is the perfect time to do this all-important review of your finances. But first, let’s get through some of the fun stuff you can do for a rest.
It may not sound like the biggest thing to get you occupied, but taking long walks, alone or with friends and loved one can be very fulfilling. If you are in the Coast, you can never go wrong with a walk by the beach, probably with some good company.
The Nairobi Safari Walk is a great option if you are in the city. It allows for uninterrupted views of animals and costs just Ksh500 for citizens.
Now, you can pair these walks with lunch or dinner. If you are at the coast trying street food could be a thrill. You could as well plan a day out including a walk, theatre performance or outdoor game such as touch rugby. Try this out and tell us if it can be your thing.
For myself, if it’s clear and sunny, we’ll likely head out to a hiking trail on a hill overlooking the town. A bit of air and sunshine is therapeutic.
There are several fun activities that can keep kids engaged indoors - I am actually thinking about this option myself. We can make art items - like cards, and toys. I can teach kids basic recipes. There are board games like checkers and monopoly. The latter, especially - has a huge impact on financial literacy for kids.
The local football league has an event scheduled every weekend. I’ll bring the kids with me and cheer on our favourite side which features one of my nephews. All outdoor events, with fair weather, offer memorable family bonding moments. You too can consider activities such as swimming and athletics which are ideal, and inexpensive.
There’s great benefit in engaging in tree planting sessions at the family farm. In my case, I’ll dwell on fruit trees, especially. It creates a sense of belonging when kids plant a fruit tree, and start tending to it. Besides, with the current grafting culture in agri-business, fruit trees are a source of income 3-4 years down the road.
Now, I know this might not be for everyone. If you, at the very least, care about the environment, you may want to do something about it this weekend. Participate in a tree planting exercise. If you are in Nairobi, you can go plant trees at Karura Forest and experience the fulfilment of making a difference in Nature
If you have a particular liking for an adrenaline rush, together with your friends, family or partner, you could single out a day or two in the weekend to engage in thrilling activities such as GP karting, Paintballing, ziplining, bike-riding or bungee jumping among others.
Learn More here: Chill for Cheap: Places to Relax On a Budget in Nairobi
Don’t let the long weekend go by without doing the activities below that are all about securing your financial health.
My main income is from a monthly salary. A section of this salary is sent to a savings account at a Sacco. This is converted into shares, with an annual dividend payout. It’s not a fixed payout. My secondary income comes from agribusiness projects, which is erratic. Farming is capital intensive, and after every sale - I save profits to the Sacco account.
Against my income, expenses keep rising. I’m servicing a loan through a check-off system on my salary. I took a 5-year loan to build a residential cum rental block, yet to be completed. Other expenses include monthly bills, and basic family necessities. Another expense is a mandatory monthly allocation to my emergency fund account.
That is my feeble attempt at doing a financial self-audit off of my head. But this is supposed to be a much more comprehensive activity that helps you visualise your financial situation.
What to audit; Income, expenses, overall financial position (net worth) and financial goals and strategies.
How to conduct a financial self-audit
Read in Detail Here>> How to Do a Complete Financial Self-Audit
I stick to a monthly budget based on the very efficient 50:30:20 Rule. This means 50% goes to Needs, 30% is for Wants and the last 20% is sent to Savings. Perhaps, I need to re-define these figures.
What does your budget look like? Do you have a definite process you follow when spending your money? It is always important to keep rethinking your budget every while even when your income has not changed - you need to know if you are getting the best out of the money you have, are you following the budget? Are you Saving enough or do you need to readjust the numbers?
Signs it is time to rethink your budget
Learn More in Detail Here>> Is it Time to Rethink Your Budget? Here’s Why
Also Read: Is Your Budget Failing? 5 Ways to Fix It
My savings plan is simple - I save into a Sacco account, buying shares. I made this decision driven by three reasons:
But this is just me. And I must admit that I probably need to be looking elsewhere to get the benefits that come with other financial products away from the relative comfort I enjoy with my Sacco.
Where do you keep your savings? If you keep them in your current account, I can tell you with confidence that it is time to move them to a place where they can at least earn some interest, however minimal. I am sure you have many times fallen into the trap of dipping into them because of just how accessible they are.
Why not consider even a simple savings account? You can earn an interest of up to 8% in some banks. That is already higher than the annual inflation rate projected by the IMF for Kenya this year.
With an even marginally higher interest rate is the fixed interest savings account. Here you lock your money for a specified amount of time. If you withdraw before then, you risk losing all accumulated interest.
You can also consider mutual funds, money market funds, unit trusts, treasury bills and bonds, retirement accounts and even riskier options such as real estate, stocks and gold.
Wondering whether these options are good for you? We got you! Below is a link to a comprehensive guide on the 7 main savings vehicles.
Learn More in Detail Here>> Where Do I Keep my savings? The 7 Main Places to Put Your Savings
You may remember the story I previously shared with you on how I went on a money-wasting cruise after being very lucky to land a government job straight after college. For nearly 10 years, every time I got a raise, I increased my expenses immediately; better house, no even better neighbourhood, bought a car, yes a tiny little guzzler on loan, partied like it's November Mr Life of the Party and dressed really expensive.
More money, more spending is the definition of lifestyle inflation. I was able to learn my lessons when I had a family and two kids. I count myself lucky.
Why Does Lifestyle Inflation Happen
Lifestyle inflation is a guaranteed consequence of acting on comparison mentality; which means, keeping up with the Joneses’ attitude and making decisions to spend more based on your increased income and comparisons to others financial and/or social status.
Situations that trigger lifestyle inflation emphasise the acquisition of objects because you want to. Examples of such instances are getting a job promotion, appreciable success in business or even inheritance – where you earn more and spend more to achieve some desired degree of pleasure.
Strategies to Avoid Lifestyle Inflation
Learn More About Controlling Lifestyle Inflation In Detail Here>> More Money, More Expenses: How To Deal With Lifestyle Inflation
You have probably heard me mention my emergency fund, more than once in this article and with good reason. An emergency fund is like that favourite uncle you’d always call when you were in college and needed some money ‘no questions asked’ and they would come through for you every single time.
It is your own cushion against unexpected events that require significant amounts of money that you may not be able to raise at a short notice.
Emergencies to prepare for
The rule of thumb is to set aside emergency funds equivalent to up to three or six month’s worth of expenses. If you have been saving for emergencies how close are you to achieving your target? What do you need to do to reach your target?
Are you specifically saving for emergencies or you count all your savings will serve whatever purpose that comes up? How have you calculated your emergency savings target? Are you increasing the amount when circumstances change? - such as getting a child, being married, inflation, getting a pay rise?
You can use this time to rethink this all-important fund and set yourself up for a more guaranteed state of financial stability.
Let not the general holiday excitement and social media hype lead you into an unnecessary financial trap. There’s the budget that guides you, and financial goals to chase after. Keep focused.
At the same time, it hurts the people around you to be a complete snob and a kill-joy. Be creative. Find a middle balance between the financial line, and not overdoing it.
Happy weekend, folks.