Still in Campus? Here are Tips on how to Plan Financially for Life after Graduation.
For most of us, our time in Campus is/was probably the most abundant of our young adult lives. Finances seemed to come easy, be it from HELB or your Folks, money was always a phone call or text away. With the newly earned freedom from caging high school to a place where we can do anything, further restrictions, especially on your finances is the last thing you probably want to hear. At that period the YOLO motto rules and is taken above and beyond. By the time most of us get down from the financial abundance cloud nine, graduation is over and we have to start life, move out, find your own place and a job and sustain yourself through it all by yourself and with a long list of debts starting with HELB.
You are now a graduate, or soon to be and you now have to fend for yourself. You probably stayed in the Campus Hostels the whole 3, 4, 5 or 6 years and now you have to vacate. Either get your own place or move back home. Add job search financing on top of that. All hell breaks loose here for most.
You are probably still in Campus and that previous paragraph probably sent chills down your spine. It should but it doesn’t have to be, we walked, so you could run.
Financial responsibility is a topic that is rarely discussed by Campus students. The whole lifestyle surrounding the Campus days does not seem to warrant the need for this kind of topic.
By the time you are graduating, you’ll probably be deep in debts that you can imagine, you’ll have no financial safety net to start life with so you end taking up more loans just to start your new adult life. This life comes with so many responsibility, adulting is a messy, expensive indulgence.
How do you soften your landing into real life after school? One obvious way is Savings. The concept of saving is one thing that the current crop of youths in Kenya were never taught in their entire childhood. Saving is boring, what if you die? Well, what if you don’t? That’s should be a more scarier what if!
Savings are not only meant for retirement, holidays, your new family, to build your dream home or get that sweet ride you have always wanted.
Savings could be for emergencies and other small adulting stuff like getting a new place, or few more plates and sufurias, things that we take for granted while still in Campus.
As a graduate, savings will come in handy when school is done and no opportunities are presenting themselves. They will help you navigate the turbulent waters of unemployment until you find your anchor.
How do you begin Saving?
We are lucky generation, days of queuing for hours to deposit your 500 or 200 shillings extra are gone, and that comes with it’s issues, like impatience, if you could queue for an hour to save 200, you’d be more disciplined not spend it any how. But if you can send the 200 to your Mshwari in seconds, and walk around with it, it’ll probably not finish a week in there.
- Saving requires discipline.
How often do you end up with the exact (or more) amount that you had on Friday, come Sunday evening? How often do you go for manicure, pedicure? How fast are you to shikia squad mzinga when you have extra notes on you?
Now imagine not having to do all that when you can! That requires discipline, and that is 101 of saving.
- Saving does not require a goal, per se.
Once you start playing around with the idea of saving, you’ll probably come by the question, why are you evening saving? And you won’t have an answer for that, but don’t quit just yet. You don’t need a reason to start saving. Rest assured, there will come a time when the need for the money will be urgent, like now, then you answer that question.
- If it helps, set a goal
If you do not know where you are going any road will lead you there, but it will probably take you a few ages to get there. Goals help to keep you in check. Set small achievable goals that will build your momentum for the bigger targets. Achievement of small goal can be good motivation. You are in first or second year, start with small targets like saving for that dress you want, or a new phone, or a laptop. When you push yourself to bigger targets without training yourself to achieve small tasks, you will fail or give up along the way.
- Keep track of your expenses
Disclaimer: If you are spendthrift, this will be scary for a start. If you’ve never, ask your bank or Safaricom for your last month’s statement. See where your money went, see where it shouldn’t have gone, cut those off and start tracking your expenses. There are plenty of Apps for that, or you can keep a notebook ledger. Create a budget will show you how you spend. But watching your spending habits will show you the pattern. Which season are you likely to spend more than you can afford and on what.
- Create your budget
Plan for all your money that comes in. Create a budget that encompasses all your expenses beforehand, for the known and unknown circumstances. Factor in all types of expenses that might occur. Nothing is too little, the small expenses will rack up to a few thousands in a couple of months. Remember that your savings target should be part of your budget. Your budget will show you what to spend on, the rest, push them to your savings.
- Cut on your spending.
Find ways which you can cut down on your expenses. This can be through cost sharing amenities such as rent, food costs, dining in rather than out, etc… Do not shop on impulse, this will lead you to spending money that you had not planned for. Tip on saving while shopping is to be on the look out for offers and discounts, with all the online shopping platforms popping up, that shouldn’t be a problem.
- Pick the right tools
There are so many apps out here that can help you track your monthly and even daily expenses. Such tools will help you keep track of all your expenses and not spend past your margins. Apps like Day to day Expense or Money manager.
- Where to Keep your Savings
For the less financially disciplined individuals, where to keep what you’ve decided to save can be tricky. Below are few options to help secure the savings;
- Join a Sacco: You are probably thinking, ain’t those for the old and employed? News flash, nope… If you have an ID, you can join a Sacco. But first, do your due diligence. Crooks are always lurking, find a reputable Sacco, say Stima Sacco, if need be, talk to them on the Options they have. Saccos allow you to deposit some money for a set period, say three months, thereafter you can borrow a multiple of your savings.
- Lock up your Savings with Mobile Money: KCB MPESA and Mshwari are the perfect example. Ever heard of the 52 week challenge? You save up a certain amount every week for 52 weeks, that’s one year. At the end of the year, you get to withdraw your savings with some interest.
- Piggy bank: Yes, piggy banks aren’t just for kids, what if you put away every coin change you end up with at the end of the day? How much will you end up with at the end of the year?
- Buy a resell-able property: Say you come by some good amount of money and you don’t have urgent need for it right now but you’ve always wanted a PS4, you could buy that PS4, and use it for the time being or rent it out, when you’ll need the money, you sell it, how’s that for an idea?
- Get yourself some sort of Insurance: Doesn’t sound like savings, but it will be when you need it. For just 6,000 you get an NHIF cover for a year. After all, savings are meant for emergencies, aren’t they?
- Create a Merry go round with your Squad: Again, this is not just for your Moms. And you all know how it goes, if you don’t, ask a friend, or your Mom.
- Invest in/Start a Business: This is for the entrepreneurial. For those who don’t like having their money just lying around. There is probably no better time to start a business than when you are still in Campus. You have other responsibilities competing for your money and time. You also won’t feel the impact of business failing as much a s you would when you have a family back at home depending on it. Incase you wondered, the other perfect time is after retirement.
Of course those are not the exhaustive options, but it will help you get started. It will not be easy and it will definitely not be fun but growing a healthy savings habit will help you manage your finances better, now and tomorrow. Do not wait for that pay cheque to start practicing better financial habits. Probably you’ll graduate and transition straight to a well paying job, but are you willing to bet on that?