1. Set Financial Goals for yourself. A city worker once asked to explain his purpose in life said ‘I dig the ditch to earn the money to buy the food to get the strength to dig the ditch’. Alas, no wonder then, the ditch gets deeper and deeper! Folks have made pretty good careers out of ‘ditch digging’ and wonder surprisingly why they find themselves in financial holes month after month.

2.Live on a BUDGET*.Tell your money where you want it to go rather than be wondering where it went. Consumer debt has become a major crisis the world over. Master your relationship with money. Undisciplined lavishness is only a habit of vicious trap! Life has never been merely about a set of curtains and two Corollas in the garage.

3.Pay yourself a portion of your paycheck. This age old advice simply means that before you pay any other bills; you put money in SAVINGS first! Then move from savings to INVESTING. At least 15% of your earnings should be diverted to acquire Assets. The ability to convert earned/active income into portfolio asset/ income will determine your degree of Financial Independence. And remember that this should, MUST, be proportionate to your level of income. It won’t make enough economic sense if one was to use the cups to fill his reserve tank if s/he has available option of using a bucket.

4. Have a clear understanding of what an Asset is. My simplest definition would be: Asset: Puts money in pocket/ grows invested capital; Liability: Removes money from pocket/ eats from capital. This definition puts distinction between your utility assets and investment assets. A healthy balance is advised.

5. Leverage yourself to use Other People’s Money, OPM, in building asset base. Note that this will be in the measure of how much you have accumulated yourself. And enough prudence is called in understanding the fundamentals of an OPM. How naive is it to suppose that paying interest on our own money is normal. What would one be doing borrowing KES 500,000 from his/her SACCO, when his/her own shares is equivalent to KES 700,000, yet still go ahead and pay interest on the loan. Well, that’s what folks do!

6. Take advantage of any tax concessions available (Tax Avoidance). Tax Avoidance is legal, Tax Evasion is Illegal. From long term savings, to pension schemes to mortgage funds to life insurance to business asset exemptions, there is just enough reason to reduce your tax obligations to your government. Why not especially when they encourage you to. Always – always! – fund any tax-sheltered or tax-exempted investments first. Contribute the maximum to any unit linked investments, life policy and pension schemes recognized by RBA.

7. Professional Management. Risks and returns are two side components of any investment. More often than not folks get exposed to risks they do not understand, in the process sabotaging their own investments efforts. This, coupled with greed constitutes unwarranted risks!

8. Use your wealth wisely. Someone once said, “The reason most of us aren’t rich is that we’d spend it all on ourselves.” Give. Share. Help others. When you use money to make a difference, to have a positive impact, you get the chance to do more. Being greedy and selfish will not draw money to you. Investing in your community, will! Proverbs 19:17.

9. Put a hedge around what matters to you. Insure. Insurance in Kenya as indeed everywhere else has been demonized too much than I care to delve into. But the question I always ask folks is ‘Do you need insurance?’ Honestly, there could be a valid argument against insurance’ selling’ but if you have small children, a house on mortgage and a pile of family maintenance bills, you’d be better reminded that you really, really need to protect those you love. The alternative is simply reckless and irresponsible.

10. Time. Time is of essence and the time to start was yesterday. The next best time is Now! One step at a time, at your level.