#SolutionSaturday
"What matters is what you keep, not what you earn" 🧵
We look at two cases.
1️⃣ John earns 300K per month.
2️⃣ Mary earns 50K a month.
John spends as follows: Mortgage & Car Loan: 150K. He saves 50K monthly in an FD earning 8% interest annually.
>>2
"What matters is what you keep, not what you earn" 🧵
We look at two cases.
1️⃣ John earns 300K per month.
2️⃣ Mary earns 50K a month.
John spends as follows: Mortgage & Car Loan: 150K. He saves 50K monthly in an FD earning 8% interest annually.
>>2
Mary spends up to 30K & is able to save 20K monthly.
Is John saving more compared to Mary? NO!
He only saves 16% while Mary saves 40%
John is a busy professional (an insurance executive) & has no time to actively manage his money. He leaves it to a fund manager.
>>3
Is John saving more compared to Mary? NO!
He only saves 16% while Mary saves 40%
John is a busy professional (an insurance executive) & has no time to actively manage his money. He leaves it to a fund manager.
>>3
Mary pools her 20K with other 10 people in her group (chama). They raise 200K for 12 months (Ksh 2.4M) & invest in an events management company where they hire out tents, chairs & sound systems. They have bought their own truck.
They generate 600K profit in the first year.
>>4
They generate 600K profit in the first year.
>>4
Mary's group reinvests into their business. They scale up & double their profits within 2 years.
By the 5th year, they have diversified into owning event grounds in different towns.
Their company generates Ksh 6M in profits & hopes to pay each member 50K per month.
>>5
By the 5th year, they have diversified into owning event grounds in different towns.
Their company generates Ksh 6M in profits & hopes to pay each member 50K per month.
>>5
John, on the other hand, has managed to save Ksh 3M so far. He earns about Ksh 240K annually, that's 20K per month.
If he loses his job, his annual income is enough to last him just one month.
Mary earns Ksh 600K per annum, which can last her 20 months, ceteris paribus.
>>6
If he loses his job, his annual income is enough to last him just one month.
Mary earns Ksh 600K per annum, which can last her 20 months, ceteris paribus.
>>6
Many people mistake earning a good salary or having the right job title with being able to create wealth. The two are worlds apart.
Being in a finance related job does not mean you know how to create wealth.
Remember, it is never about what you earn, it is what you keep.
>>7
Being in a finance related job does not mean you know how to create wealth.
Remember, it is never about what you earn, it is what you keep.
>>7
A little can do a lot, and there is always somewhere to start.
Start with the @TheAbojani November Personal Finance & Investments Masterclass & nurture skills to scan opportunities for growth & income in the capital markets.
Early bird offer ends on 29/10/21 ⤵️
Start with the @TheAbojani November Personal Finance & Investments Masterclass & nurture skills to scan opportunities for growth & income in the capital markets.
Early bird offer ends on 29/10/21 ⤵️
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