INCREMENTAL SAVINGS :VERY KEY IN THE NEW YEAR

 Savings are very vital for life. Without adequate savings life becomes tough. A certain youth got an accident and nearly lost his life .This was because he could not afford treatment. In fact so many lives have been lost due to lack of an emergency fund. In most cases so many people live at the mercy of God. It was very evident during the lock down that we need to put a lot of emphasis on savings for the future. Two men burnt themselves because they could not cope up with life.

Without savings dreams are shattered. There are very many brilliant students whose dreams have been shattered due to lack of school fees. In fact I heard a story of a young girl who had to be married off at an early age of 14 years since there was no school fees. This can be linked to lack of money to save for school fees. Without adequate funds society is forced to barely survive and this leaves it vulnerable to external shocks . As a Financial Literacy Trainer I have travelled across the country and realized that very many Ugandans have the potential to save. The missing link is the encouragement to do so. As financial literacy practitioners we have a critical role to play in inducing the public to save. The Microfinance Industry has demonstrated that every one can save. With determination we have seen market vendors pool resources and built houses. What this means that there should not be an excuse that people can not save. 

If a person saves as low as 1000 Uganda shillings per day, he or she will have 365000/= by the end of the year. But because there is a tendency to undermine the little coins we tend to relax to save. The rich know that every coin matters and it is the discipline of saving that counts. We may attend all the financial literacy trainings in the world but of we do not implement the savings culture we are bound to be exposed in case of emergencies.

In a nation that is full of young people there is a tendency to only look at success at the top. Little do they know that all the successful entrepreneurs started from some where. In fact many of them began so humbly but they had a long term view of their destiny. It is said that Warren Buffet is a frugal spender. This is surprising yet he is one of the wealthiest men in the world. On the contrary there are university students who spend due to peer pressure and without a budget. Such financial behaviors expose these youths to external shocks.

During the festive season the spending habits of Ugandans are adequately exposed. There is an article I wrote where I asked a question, is the festive season only for spending? This is because it is the dominant message during this season. The tendency to discount small coins discourages people from saving and those who struggle to save spend their money on unplanned ventures.

Some of the African slogans such as "spending money like a fisherman " are detrimental to building a sustainable savings culture. This is especially true in rural areas. 

HOW TO IMPROVE THE SAVINGS CULTURE 

1.Have a long term financial vision

2.Live with in your means

3.Develop a budget

4.Seek financial mentorship

5. Save as you earn

6.Celebrate small progress

7.Automate savings

8.Create an emergence fund

9. Research before you invest

10. Avoid self comparisons

11.Develop a savings plan


Savings are very important in improving our welfare. However all is not well in society regarding developing a savings culture. With a visibly high cost of living, there are many reasons given by the masses for failing to save. There are so many lessons to learn from wealthy people. If Warren Buffet who is one of the wealthiest people is frugal in his spending then there is a reason to develop a savings discipline in our personal lives.


Phillip Kiryowa 

Personal Finance Coach

Advanced Empowerment Link

+256752615916

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