Saving tips for first-time employees
Soon after Alex Kibunja secured his first job after college, he moved in with his married sister to save on costs.
His salary of Sh12,000 at the time was not enough to offer him the life he wanted right away.
He first needed to save up and buy furniture and other household effects before he could rent a house of his own.
While at his sister’s house, Alex made a monthly contribution of Sh5,000 towards expenses in the household. He felt it necessary to contribute since his sister and her husband provided him with everything else and also because he was able to save a little since he was not paying rent.
Experience
According to Alex, renting a house after college meant he would spend about Sh5,000 on rent, Sh2,000 on groceries and Sh2,000 on food, leaving him with only ShSh3,000 to spare. By living with his sister, on the other hand, he saved Sh4,000 more bringing his total savings per month to Sh7,000.
Alex stayed on for three years before he was able to rent and furnish his house. I bet many of our readers would relate to Alex’s experience because this is how many of us start off on our careers. The concept Alex used is termed living within one’s means.
Given that the cost of living has gone up making life and house rents expensive, young people and first time employees need to be wise and plan their lives effectively by making good use their monthly earnings, however minimal.
It is considered financially prudent to save part of your earnings for medium and long-term long goals, while still being able to set some aside.
This means, using one’s entire salary on food and rent works contrary to the financial principal of planning and budgeting.
In our money article published two weeks ago in BDLife, titled ‘Make a budget to avoid debt’, readers sought answers on the possibility of budgeting with small earnings and more so on how to live within their budget.
It seems most of them were not convinced that they could budget on ‘small’ salary.
Living within your means doesn’t in anyway mean denying oneself life’s pleasures but rather spending responsibly. Anyone, regardless of the financial hurdles they may encounter in life, has the capacity to spend wisely and save up for one thing or another, but only if they are bold enough to strictly adhere to the goals they have set.
Among the financial routes first time employees can consider is sharing a house with a friend or friends, bulk buying and shopping from a wholesale shop instead of a supermarket.
The nightmare of sharing a house is what many would rather avoid if necessary. People, let alone close friends find it unbearable to share a house, since hidden differences are often bound to play out in the open at some point.
