Here is How your Money will Grow

Part of managing your money is making it grow. This is where a lot of us get stuck. In different conversations I have had with people, many of us want a magic solution (Click to Tweet this). We want to be told to put a certain amount of money in this and that and it will grow. I think this is why so many people got caught up in pyramid schemes a while back. You did not really have to do anything. It relied on someone else and the scheme promised an abnormal return. You didn’t have to think or apply any reasoning. Chances are someone had gotten in earlier than you and they had their testimonial ready of how their money magically multiplied. Many burnt their fingers as well but the message here is that even though sometimes we go about it the wrong way, we want to grow. What needs to happen for your money to grow? How does the one become two and then five and then ten? I am not providing the magic answer to make you a billionaire tomorrow but the overall process.

• You grow money by saving. You cannot invest what you do not have. I cannot count the number of times people have asked me where to invest their money without a shilling in savings. So we end up having a long discussion only to find that they were not actually prepared for it. What is the point? If you want to grow your money you have actually got to prepare for it. You would need to start somewhere. Put money aside regularly whether or not you know where to invest (Click to Tweet this). You are more prone to think about and seek more information on where to invest when you have money sitting somewhere like a savings account. Just the same way you would only consider driving a car that has fuel in the tank. Consider these savings as fuel in the tank. Gas up.

• You grow money by keeping your eyes open. Are your own eyes open? If not, what are you doing to get them open? No one can take the place of your open eyes. They can give you insight and guidance but they cannot replace your ability to make decisions for yourself. You don’t know where to invest because you’ve not taken the time to learn where to invest. Too date I have not met any wealthy person who completely delegates decision-making. Don’t get me wrong. You don’t have to know about all the shares on the stock market. But you need to have initiative to get to understand how the stock market works, what makes a good company, risks involved etc. Then a professional or stockbroker can add on with the insight they have on certain industries or shares so that you can make the decision. Do the research. And let’s not hide behind not having time. A portion of the time we spend watching TV is the time to do this research. When it comes to conversations about money, where to invest, there are many blind people leading other blind people. Make sure that the conversations you are having is not one of those. Make sure that the person claiming to advice you (even if they have a fancy title) is also knowledgeable.

• You grow money by being focused. You can’t invest in all things. Your eyes cannot be open to everything. You also cannot keep getting blown by the wind and jumping into every investment that comes across your way. Sometimes NO is the better answer even if it is YES for somebody else. Getting the best value for your money means different things to different people. What is your definition of growing money? Is it the one becoming two or becoming five? In how long? Then it is your job to keep your eyes open, ear on the ground to what will get you there. Different investments behave differently, have different risks, and will give you returns differently. Do your goals dictate you find the kind of investments that you can sell after a certain period and realise a gain? Do your goals dictate you start getting an income from them? Different shares, different business ventures, different types of properties can do either or both of those things. There are even different investment strategies for treasury bonds that will get either of those two results. Know your end game so that you have a better chance of recognising the information you need, the questions you need to ask and the research you need to do.

• You grow money by taking risks. Be prepared to lose some. Be prepared for things not to go your way. I personally do not think risk-taking is an option if we want to grow our wealth. But based on the points above, it can be calculated risks, not blind risks. Risks based on information. Risk based on decisions being made with your eyes open, and not pyramid-scheme types of risks. This is why we have to grow our money (not only save) and why risk will be involved. What costs you Kshs 10, 000 today can cost Kshs 30, 000 in a couple of years based on increases in various goods and services. If you didn’t look for avenues to grow your Kshs 10, 000, you will not afford to buy that same item. This explanation covers your lifestyle hence retirement planning, school fees and university fees for your child, medical expenses, buying a car etc. We cannot afford not to take risks.

Last but not least, all the above points are underpinned by you taking some form of action. If you don’t act, you do not grow. Do something different, today.

Looking to spend more efficiently, save and grow your money? The Centonomy 101 Program will help you see your money differently, interact with it differently, and help to accelerate your financial growth.  Click here to learn more about Centonomy 101.

Waceke Nduati-Omanga runs programs on Personal Finance Management, Entrepreneurship and Career Success. 

Find her at waceken@centonomy.com| twitter @CekeNduati| Facebook.com/CekeNduati