Sorry to say this but many of us will think this is some form of rocket science or black magic for it’s very hard to save while on money we receive as a loan from government (HELB) it does help to a large extent but not enough for saving.
Writing this particular article illuminates my path,I see success at a different angle.Saving? folks back at home will send me 500/= for a week ! I can’t really save & that’s an established fact that can never be subjected to argument in comrades territory.
With educational expenses increasingly consistently, it seems a bit shocking to suggest that students think about investing. If you barely have enough for school expenses, can you really even think about saving money and investing?
To be honest, college really is the best time to start investing. At this point, it’s very likely that you’re paying for school through a combination of loans and parental assistance. Never again in your life will you have the opportunity to live without paying for rent, utility bills, and other expenses, so you better take the chance and make the most of the money you have.
More importantly, investing isn’t about the amount of money you put in; it’s about how long you have the money invested. Because of compound growth—wherein your original investment plus the interest you earned grow together—there is bigger growth potential the longer you invest. Someone who invests less but does so continuously for ten years will earn more than someone who invests a lot more in a shorter span of time.
A Few Questions
Before you wade into the investment pool, however, here are three questions to ask yourself to make sure you’re ready.
1.) Do I have emergency savings? The thing about investing is that you’re supposed to think long-term. Withdrawing your money after a few years means you lose out on earnings. Before you invest, make sure you have enough money to cover an emergency or any other unexpected expenses.
2.) Do I have something better to spend on? Don’t think of this as a question that pits frivolities against investing. To consider something a “better” choice for your money, it has to be urgent and financially important. For example, you should pay off your high interest debts first before investing.
3.) What do I want to achieve with this investment? Different people have different goals. Even in college, it’s never too early to start saving up for your golden years. However, you might want this investment to be money for a home, a car, or to pay off your student loans in the future. Knowing what you want to achieve makes things easier because you get motivated.
If you have decided to invest your money, the next step is finding out how to go about investing. A lot of students—not to mention adults—find investing confusing and difficult.
Here are a few tips to remember before you start investing:
- Educate yourself. Popular culture has affected the way people view investments. It’s important to clear your mind of these stereotypes before you start investing, because otherwise you might get incorrect expectations. Do your research. There are a lot of instructions and guides online that can help you get started.
- Determine the right type of investment for you. There is more than one option, e.g. mutual funds, stocks, etc. By doing research, you should be able to figure out which type of investment can make the most returns for you.
- Decide on the level of risk you can live with. Investing can be scary, but only if you invest on risky stocks. They bring in a lot more earnings, true, but the chance of losing everything is bigger, too. Figure out the level of risk you can tolerate and invest accordingly.
- Keep on researching. Investing is not easy, but it can be very profitable if you know what you’re doing. Don’t get complacent. Continue to educate yourself by reading books, keeping up with financial news, and joining seminars and lectures.
Where to Invest
There are a lot of options for college students to choose from, so it’s important to do your research before investing.
Here are a few to consider:
. Invest in a merry go round.
Start a merry go round with your friends. You can contribute each week, or every month. For every round there is somebody who receives the money. At the end of each month, a member gets contribution from all members then the circle goes round again. When it’s your turn, you can invest it again or buy something that you had planned for like a radio, shoes, and clothes. Merry-go-round teaches you the discipline of saving money. Some of these chamaas, if well managed can end up being an investment club.
.Starting a blog
Starting a blog will give you high chance of getting to know where your potential lies and it will eventually help you learn more about the niche that you wan to example if you are interested in starting a food kiosk or even investing your money on a canteen,you will be a step ahead for the more you research on some information about that particular facet that you wanna venture into,Better still you can always monetize your blog.
. Invest in the stock market.
To do this you need to get a broker who can help advise you on shares to buy or if you are business smart you can just invest the money by yourself. It is important to shop for a broker who will work well with you and your needs. The best way to get a good broker is to ask for references from people you trust who are actually investing. If you are not sure about investing in the stock market and it’s your first time to invest, you should probably invest a little cash first to see how it works. If it is good for you then you can invest more. Share brokers usually charge a commission on transactions but if you’re buying shares through your bank they won’t charge a commission (well I know Equity doesn’t).
Safaricom has launched BLAZE, a product to help the youth be in control of their finances and help them succeed in their specific fields. One of the services offered is creating a plan for mobile services. Think of it as post-paid but now it is in your control. You decide how much to spend over what period of time and you have the choice to renew the plan or unsubscribe. Here is how to do it step by step;
You can either go on to the website directly or dial *555# and follow the steps. Please note that the website can only be accessed on mobile. When you dial *555# you will be provided with these options.
. Join an investment club.
A group of interested individuals may come together to pool their resources. This means that they have more cash to invest together as a group than they would have as individuals. This gives them more purchasing power. But be careful who you team up with. There should be a contract signed by all parties to ensure that in case anything happens there is a binding agreement that states what happens in such a case.
Kenya’s communication industry has really grown and by having some start off capital of about 2000/=,you can approach Safaricom and get registered as an agent and get a commision from there
. Fixed accounts or mutual stocks.
If investing in the stock market is not your thin, you could put your money in a fixed deposit account where it will earn interest. Forget saving accounts. If you actually think about it and do the math you will realize that you actually never save any money after they remove all the ledger fees, withdrawal fees etc. It is a legal way for the bank to take your money and charge you fees for it. You can invest in mutual funds or buy bonds which usually give a good rate of return. These are usually expensive though.
What kind of investments have you made or are considering making? Share them with us in the comment box below!