Towards the end of July this year, the Kenya National Bureau of Statistics (KNBS) announced that inflation had reached a five-year high of 8.3 per cent from 7.8 per cent in June. This called for Kenyans to be more frugal with their finances.
The cost of living has been skyrocketing and the government has attributed this to many factors including the ongoing Russia -Ukraine war.
Despite the President Uhuru Kenyatta’s subsidy on fuel and maize flour, Kenyans continue to lament on the high cost of other commodities. Additionally, the Ksh100 maize flour is still unavailable to most Kenyans.
An image of inflation rate by April 2022.
In light of these tough economic times, members of the public have adopted tactics to stretch every coin and put food on the table. Kenyans.co.ke takes a look at tips that can help you remain financially sound.
Kenyans have taken the initiative to document their expenses. A budget covers every aspect of your financial life including any side hustles or investments you may have.
With a budget, you can review your income, expenses, and any financial goal. According to a financial planner, it is necessary to adjust your budget every few months to keep up with the economic times.
A recent consumer report showed that Kenyans were forced to cut costs on ‘luxuries’ as the price of petrol continued to rise month after month.
Mobile loaning apps have recently gained popularity in the nation. They are preferred for their accessibility, flexibility, and efficiency in granting loans.
However, despite how easy and fast acquiring a loan is, Kenyans should excise caution before taking up a loan. The increasing interest rates on loans have contributed to the debt being expensive.
When repaying debt, it is advisable to focus on the high-interest rate loans first.
Prepare for Holidays
Holidays are have been affected by the abrupt increase in prices of common commodities which includes fares. Kenyans are adopting prior shopping for necessities before going for holidays.
The inflation is also unpredictable and could result in commodities costing more during the holidays. Kenyans have in the past taken advantage of mega sales from retailers.
Plan for Retirement
Despite the tough economic times, Kenyans have tried to save for retirement. The income Tax Rules 1994 define early retirement in Kenya as 50 years.
However, the youth could also start preparing for retirement. Financial experts suggest that the earlier you begin saving for retirement, the more money will be accrued when you eventually retire.
A well-laid-out retirement plan could save you from living in abject poverty in your old age.
Kenyans identifying and setting their financial goals have a clear idea on how to spend their finances. Financial goals can be either long-term or short-term.
A signpost of Retirement Benefits Authority (RBA).