Start with what you have

Last week I had the pleasure of talking to a diverse group of people about investments.  As is common with many people, not many of them had invested as much as they think they should have. I asked all of them to list where they think they should be investing. The kind of list I got was property in Runda, development of apartments, huge Treasury Bond and share portfolios, relatively large investments in various businesses etc. They all had the “I wish I had syndrome”.  Now this article is not about elaborating the right or wrong of their investments choices but rather their mentality regarding the investments.  They are behaving like the new graduate who wants to be CEO of a well-established organisation.  There is nothing wrong with this graduate wanting to scale those heights in his career, but he has to start with the internship that he has just been offered.  He cannot expect to decline the internship job, dream about how he wishes he was the CEO and one day it will inexplicably occur.  This week in our course we were discussing real life examples of people who had created wealth in Kenya and they all had one thing in common.  They all invested at their level. Now they are the ones who by starting where they are and continuing to build on that foundation over time have the kind of investments that the group in discussion can only fantasizing about.

These are the kind of things that can happen when you start at your level.  I am not at liberty to divulge all the personal details of the stories shared in our class this week but I can give you a snapshot of the beginning and end results of the process for various people who by any means would now be considered wealthy. Buying one minibus has lead to fleet of 30. Purchase of a piece of land worth Shs 400, 000 and the continued discipline of investing salary income has to date enabled a bond portfolio (amongst other investments) of close to Shs 50 million.  An initial investment in shares of Shs 1, 300 has resulted in stock and land portfolio worth six million shillings. A saving of three thousand shillings enabled creation of a company that was sold to a multinational for billions. Baking of cakes to sell to workmates has resulted in a bakery with annual turnover in millions. An investment group with contributions of five thousand per person recently paid Shs 10 million shillings as dividends to each of its members.  The list can go on and on. If you don’t believe me go and talk to someone who has created wealth.  Find out their story and where they started.  Yes they are obviously other details in between the beginning and the end result but the key that unlocks the treasure chest is to START. Take up the internship job even if your dream is to be the CEO. It is only by sitting in the company that you will be able to learn and grab any opportunities to climb the ladder.  The same holds true for investments.  The best investment is the one you can afford to do today not the one you only dream about doing.

You may not be able to buy land today but you can buy shares.  You may not be able to go open a restaurant but you can bake a cake.  You may not have Kes 1 million to put in Treasury Bonds but you can save Shs 10, 000 per month and in five months you will have the Shs 50, 000 required to invest.  You may not have the funds to buy a house at your dream location but you have money that you can buy an investment property somewhere else.  Just start where you are.   The most powerful thing this does and why the people in the examples I have used have created wealth, is that it shifts your way of thinking. As long as you are thinking, “I wish I had/have” you will see and focus on all the reasons why you don’t have and you end up not doing anything.  The reality may be that I cannot afford property in Runda. But as long as I do nothing else all I will see is why I can’t afford Runda.  But the minute I go to where I can afford and invest, I then start seeing all the opportunities that I can actually do.  I even start seeing different ways of doing things e.g. pooling resources with others. It’s exactly the same reason why you only learn to drive a car, by actually driving a car. Your investments will grow by only starting to invest.  If today you have a reason why you are not investing, tomorrow you will have another reason. More money will not make you invest more. Remember investment is a process and does not work on instant gratification. The examples I gave took place anywhere between 5 and 30 years. Don’t procrastinate in the name of having this huge investment (that you are honestly doing nothing about) that you think will give you instant recognition.

Waceke runs a program on personal financial management. Find her at waceke@centonomy.com|

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