MONEY TALKS: Challenge yourself to save differently this year - Daily Nation

MONEY TALKS: Challenge yourself to save differently this year

Monday January 21 2019

Saving money has to be fun, engaging and different at the very least.  PHOTO | FILE

Saving money has to be fun, engaging and different at the very least. PHOTO | FILE 

By BETT KINYATTI
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Saving money has to be fun, engaging and different at the very least.

Standing orders and direct debits are practical and effective, but they feel like something my dad talked about with his bank teller in 1993.

It’s 2019. Practical and effective don’t have to translate to boring, hands-off and clinical. A saving challenge will help you reach your goal of saving money, but – and this is where I want you to pay attention – it also changes how you perceive with money.

Money starts to take on a new colour of camaraderie and play.

MONEY CHALLENGE

A money challenge is also an opportunity to turn this saving thing into a group activity. And you know how our culture loves such?

I check in on you, you check in on me, you send me screenshots of your growing savings account, I send you smug selfies when I’m done drafting my budget, you meet with me over a drink at happy hour to take stock... it’s all good.

That sense of community and accountability does more for anyone than a bank teller would.

There are several money challenges floating about the vast galaxy of the Internet. I’ve selected three of the more popular ones and broken them down for you:

THE 52-WEEK SAVING CHALLENGE

It’s a weekly savings challenge. You save from your daily/weekly spending. You increase the amount saved every week by a consistent amount. It has a compounding effect on your savings.

So January, week one, you start by saving Sh100.

January, week two, you increase the savings by Sh100, so you save Sh200.

Week three, you increase the savings by another Sh100, so you save Sh300.

Week four, the same thing, so you save Sh400.

So in the four weeks of January, you should have in your savings Sh1,000.

Repeat this until you complete the 52 weeks of the year.

You can also save as much – or as little – as you are able to. From Sh20 to as much as Sh1,000.

With saving 100 every week of the year, you will have saved in 52 weeks, Sh137,800.

WHAT I LIKE ABOUT IT
It feels achievable because the big goal of saving that much has been broken down into smaller more manageable bite-size chunks. Sh100 isn’t difficult to come by. Anyone can look into their wallet and find a note of 100 bob.

I also like that with time you, you’ll commit to save first then spend what has remained after your savings – you’ll learn to pay yourself first. 

A goal of saving Sh137,800 in a year is about Sh11,000 every month. It’s different when I put it that way, right? Sh11,000 a month versus Sh100 a week changes how perceive your savings. That perception is what contributes to its popularity.

Is it too late into January for me to jump on the bandwagon?

HOW TO MAKE IT WORK FOR YOU
Save with a goal in mind. Don’t save for the sake of saying you completed the challenge. That’s like going to the gym so you can say you went to the gym. So save for something that’ll make the pinch of the challenge worth your while. I’d save for travel. What would you save for?

Another way is to keep the cash where you can’t access it. Lock it away.

Also, don’t skimp on your weekly savings and dump a lump sum to your savings account at the end of the month. That’s not how the challenge works to build discipline. You’re cheating. An increment of Sh100 every week – nothing less, nothing more.

THEALL-CASH SPENDING CHALLENGE

This challenge says that for, say, two weeks every month – or a frequency you determine – only use cash to make your purchases: no Visa or credit cards, no M-Pesa, no using a loyalty card to redeem points for shopping.

Hard cash, my friend, in notes and coins. Cash that you go into your wallet for, remove, count to make sure it covers your expense then hand it over to the open hand that’s waiting for it.

This challenge here is purely psychological. Research says that you spend less if you are using cash to pay for things.

Cash forces you to budget and spend only what you have in your pocket. It also forces you to ask yourself whether you really need whatever it is you’re about to spend money on.

Nipping into Naivas supermarket for some milk and bread before you go home in the evening? Pay with cash.

Getting your weekly fruits and vegetables from your Mama Mboga? Pay with cash.

Just seen a nice pair of H&M khaki pants at your pants guy shop in Sunbeam? Ask yourself if you really need them.

Your shoe guy calls you to try on some brown suede boots that only came in today? Make deposit with what you have in your wallet right now, pay the balance by cash another day. That’s of course, if you really must get the boots.

WHAT I LIKE ABOUT ITsome of us who buy things because we’ve seen them and we like them, not because we’ve budgeted for them.

You’ll also learn to measure the value of things against their cost. For example, is this what I get for a kilo of fish versus for a kilo of chicken?

This challenge is good for those who rarely use cash to pay for stuff. Like me. I need to take up this challenge some time.

HOW TO MAKE IT WORK FOR YOU
Draft a budget every month and ask yourself which items you’ll be paying for in cash, and which ones you won’t.

Be realistic about this, because not doing so sets you and the challenge up for failure.

Of course there are some things you can’t pay for in cash, like insurance premiums, NHIF – make sure to load up your M-Pesa or write cheques at the beginning of the month and settle them at once.

If you’re jittery about walking around with plenty of loose cash – like Sh10,000 or more – carry around only enough to keep you for that day. On the days you know you’ll need more cash, then carry it from home. Planning and budgeting, that’s what it boils down to, planning and budgeting.

Know the cost of things. It makes no sense to nip into Tusky’s supermarket with Sh180, yet you need to buy three packets of milk and a loaf of bread for Sh210. Such shortfalls will frustrate you and frustrate your commitment to the challenge.

THE NO-SPENDING CHALLENGE
How the challenge works
It says that for a few days every month, don’t spend any money at all. You can also flex it to say that you won’t spend on particular items that month, like going out for a meal, or for a movie or a drink, or to the supermarket for groceries.

The challenge behind this challenge is to ask yourself whether you really must spend the money you are about to spend. It also asks that you weigh other options that don’t ask you spend money.

WHAT I LIKE ABOUT THIS CHALLENGE
It compels you to think outside the box. You become creative to try new ways of doing the same old. Especially with entertaining yourself and the family.

This challenge also asks you to work with what you have within your reach right now. Like, do we really need to go out for a movie or can we catch a rerun of something old? Actually, do we need to watch TV in the first place? How else can we entertain the kids? Can I bake a cake with Jogoo flour instead?

I, for example, have several good reads on my Kindle I’ve not completed – I’ll challenge myself to complete them before buying more this year.

HOW TO MAKE IT WORK FOR YOU
Indulge in activities and experiences which leave you feeling all fuzzy inside. Make it fun for everyone in it.

Consider activities like board games with your pals at home; crafting the kids, or cooking chips and burgers with them; trying new recipes with the ingredients you already have in your pantry and refrigerator; decluttering your closet to see what you have and can keep wearing, and what you can give away to a children’s homes.

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