Why does it feel like there is never enough money? We have trained workers at minimum
wage, we have trained directors making millions and this question always comes up. I never
really had an answer until I met James.
James was a young entrepreneur who recently won a national competition with a prize
package worth a few million shillings in seed capital for the business as well as business
training at Centonomy.
James’ business was located in his home village and had been doing
very well serving the community. He was determined to grow his small business with the
money he had won and was convinced the solution was to expand to Nairobi.
With the money he had, James made a plan to relocate his business to the city where he
knew he would have access to a larger market which would mean more money and all his
dreams would come true. At least that’s what it seemed like before we did a project
assessment.
At Centonomy we never prescribe what a business or for that matter an
individual should do with their money. We prefer to help you make informed decisions.
Information is what James lacked.
You see James had been promised an affordable bed-sitter by a friend located in Kikuyu
area very close to the matatu stage. The only issue was that this was “affordable” for
Nairobi. When compared to his rent upcountry, he would be paying twice the amount.
Even though he would be close to the stage the transport cost to his place of work would also
increase. One of the other benefits of living upcountry was that he had a small piece of land
where he would grow most of his food, only having to supplement with a few items from
the shops.
In Nairobi, he would have had to buy all his food, significantly increasing his
costs. Before he knew it all the money he had won would have gone toward the change in
lifestyle even before he had acquired new customers.
I don’t mean to dash James’ dream. All I am saying is that with some thought he could have
used the prize money to work on his current business until it had made enough money to
open an outlet in Nairobi, all the while enjoying an improved standard of living at home.
The reason it always feels like there is never enough money is that when our income
increases we often immediately increase our expenses. Buying new things, moving to the
new apartment with higher rent, and forgetting to increase our saving and investment.
When the money comes in, take a moment to think about what really matters to you and if
you can afford it. I am not saying that you should never enjoy the increases you receive, all I
am saying is manage them better. If you manage the increase, the gap between your
income and expenses will grow and you will have more than enough money.