I have taken a keen interest in acquisition and dissemination of financial education. It is rather obvious that the biggest handicap to most people achieving financial freedom is lack of financial education. We have people all over who are keen to invest and start business but the truth of the matter is that 90% of the business started fail within the 1st 5 yrs of operation.

More often than not, we are quick to jump into opportunities without critically analyzing them. We thus end up missing the bigger picture.

We have a breed of people who believe that capital is the biggest handicap towards starting a business but they fail to realize that unless one is well armed with financial education, then it becomes extremely hard to succeed.

School and universities never teach financial education. The end product is very sharp minds in respective fields but graduates who don't understand the basics of dealing with money, creating wealth and maintaining it. There exists a very big gap and the same must be addressed if we want to progress as a country and get out of the shackles of poverty and of course the middle class mentality.

Hey Marty, i totally agree, a lot of us are financially illiterate, especially those who are in 'non-business' fields. Would you please share your resources here or email busy.idler@yahoo.co.uk

I have had m financial education on wazua over the past 3 years and wish I got it sooner

That Millionaire next door:

Believe it or not, one of the most important indicators of whether you can become a millionaire is how you think. Yes, a large part of financial success begins with your mind.

What are your thoughts about money and wealth? Do you think like the wealthy?

Millionaires are not afraid to take risks.
Many of us fear change and would rather settle on the easy path - the path of least resistance. This path will never lead to wealth. Millionaires are millionaires because they do things differently from most people. They are willing to take risks (calculated ones) and responsibility for whatever the outcome.

Millionaires are positive thinkers.
This does not mean that they deny that things can go wrong. It just means that by default they expect things to work out. Millionaires are realistic positive thinkers.

When they create a plan, they anticipate what might go wrong and develop a strategy for coping should that plan go south. This way they decrease their level of failure. And their high success level reinforces their assumed expectations that things will work out in the end.

Millionaires cope well with failure.
Failure is an inevitable stumbling block on the road to success. Every millionaire has failed at some point, and because they play with high stakes, they've probably had some very big failures. A case in point is one Donald Trump who was 900 million in debt at some point.

However, the difference between millionaires and most people is that they don't dwell on their failures. Instead, they accept them as part of life and make a point of learning from them.

They are creators, not victims.

Millionaires don't passively sit around accepting whatever happens to them. If they're not happy with their current financial situation, they take action. For example, when they lose, it's highly doubtful that they spend all their energy dwelling on how much money they lost and how they'd never get it back. Instead, they are most likely thinking, "What do I need to do to right now to create enough money to be a millionaire again?"

Millionaires are leaders.
A follower doesn't typically come up with a million dollar business idea. And if they do, chances are they won't act on it. Millionaires think like pioneers. Their minds are always open to the next great opportunity they can turn into a reality. And once they have an idea, they effectively harness the energies to materialize it.

If you want to be a millionaire, you should begin thinking like one. Your mentality colors your entire perspective of the world. And once you begin seeing possibilities where you once saw dead ends, you'll be surprised at how much abundance there really is to go around.

@Marty, thanks for the resources. Share with me more through funecosystems (at) gmail (dot) com. Thanks

Activating that financial genius in you

Note: We will get practical in this journey to financial education. For now we are just dealing with basic but very important concepts. We’ll also be relating to the Kenyan scenario(s) so as not to sound theoretical. Just to caution readers that I have a bias to real estate and most of the posts will revolve around it in future. However, other important topics like financial planning, chamas, Life insurance, leveraging on borrowing amongst others will be covered in due course.

Back to the topic of the day. All of us have financial geniuses in us irrespective of our levels of formal education. That is why one Njenga Karume (RIP) made it despite not having much to show in terms of formal education; he had a financial genius and business acumen. The biggest problem is that we are not bold enough to activate the financial genius in us because of lots of reasons but the biggest is the fear of failure. It is not the fearful who are rich but the bold. We must therefore overcome the fear factor.

At some point, you had a wonderful business idea. You kept thinking, suppose I try and I fail?? Learning to manage risk is far more important than playing safe when it comes to investments. My first major business venture was farming wheat in Narok. I was employed and relied heavily on a farm manager whom we had employed together with other investors. We used to make trips every weekend to check out the farms but as fate had it, rains failed and we lost everything. Second season, we invested in the same venture and the wheat did well and we were awaiting a bumper harvest, then again the rains were too much at the time of harvesting. Of course we lost again. In total I personally lost 600k and u can imagine the feeling especially for a young man earning 40k per month coz even raising that money was quite something. We never lost hope but learnt very important lessons. We did a third season and recovered all the losses of the first two seasons. It is extremely important to understand the business and whenever a failure comes (it is usually inevitable), learn the lessons and move on.


But how do I start, you may ask??

You need a reason greater than reality. The power of spirit, what I’d loosely call great conviction. The reality will tell you that the road seems too long and too many hills to climb. It is just easier and comfortable to work for money than to make it work for you, after all that is what they taught us in school.

You must choose daily how the shilling that lands in your pocket will be utilized in future to either be rich, poor or middle class. That is the power of choice. Cumulatively these choices determine your destiny. Do you ever wonder why two people employed at the same time and earning the same amount never progress in parallel as far as achievements are concerned?

Choose friends who reflect what you want to be in the future or people who share your vision. Don’t listen to poor, frightened people who think that money is a preserve for some people. Have a critical look at your closest friends. Do you know they are a reflection of who you are? What do they feed your mind with? Today is furahi-day, are they calling the whole day in excited tones awaiting close of business to go on a drinking spree the entire weekend. I am not against drinking coz some deals occur in those places, but if you were to analyze how you spend your time, then you’ll have a clear indication of the effects friends are having on you. The power of friends.


Pay yourself first as in set aside some cash for savings / investments before you deal with all other bills. Personal discipline will ensure that you pay yourself first before paying others like government, rent etc. If you pay everyone else first then there maybe nothing left for you. Keep expenses low; ensure that your assets column keeps rising. By the way an asset generates income, so the house you are living in is not an asset (a story for another day), neither is that car that you use to go to work (this is rather obvious).

Pay brokers well. These are people who give you good advice. Pay them better than others and they’ll always offer better advice and will consider you first. This is very practical in real estate. I have a network of brokers who will always call me first when they come across a good deal.

Assets buy luxuries. Strive to buy assets that generate money and they will buy you luxuries. Never buy luxuries out of your ordinary income, say a monthly pay check.

Have heroes. People you want to emulate. Learn how they think, do their stuff and learn from them. Personally, I like those guys who have made money honestly through hard and smart work, shrewd investments and are street smart.

Give and you shall receive. Be charitable. Give free information and teach other how to make money. It’ll become a part of your life. Giving back to society can give a lot of satisfaction and of course God will bless you a hundred fold.


Which class of a person are you?

Are you always struggling to meet your expenses and constantly in debt? Do your expenses rise with more income? Do you realize that more money won’t help you? Sorry, you are on the wrong track (rat race) and it is time things must change.

OR

Do you endeavor to minimize your expenses column and built your assets column. Do you constantly ensure that you are acquiring more money generating assets? Then you are on the right track (fast track). Sooner or later, money will work for you if at all it is not currently doing so.


Next post will be on simple and practical things that can help the fellow in the rat race. You can never invest if you are in the rat race coz all your money will always be taken up by the ever rising expenses.

Will keep doing so in bits so that guys understand and digest. No use posting too much at once.

Thanks a lot @Marty.Mind to share at kimaniwp@gmail.com.

@Marty,wow. What you are doing will really make a difference. Now while at it, would you kindly give us examples of assets coz i think when you say asset the number one thing that comes to most peoples' minds are personal 'assets' e.g. Household items,or am I pre empting a later topic? Thanks

Choose friends who reflect what you want to be in the future or people who share your vision... What do they feed your mind with? =Marty

mshikadau1atgmail wants to be your friend.

This gets tricky my friend because by definition luxuries are products and services that are not considered essential and are associated with affluence. This definition is very general and in most cases subjective coz what you may consider a luxury maybe considered essential to somebody else. But let's understand luxury from the economics perspective. Economically where you are, there is what we'd consider a luxury, and that is basically something you can do without. Take for example, a guy who works in a mjengo site cannot afford to buy meat daily. At his level of income meat is a luxury which he can do without coz if he insists on having it daily then, he'll do so at the expense of paying rent. Fast forward, the same guy gets a better job and can thus afford himself meat daily but he cannot be able to buy three beers for himself on a daily basis with the new income, at that point daily drinking becomes a luxury.

So, other than the generally accepted luxuries like Zanzibar holidays and the like, luxuries shift with economic levels. The big deal is being unable to analyze luxuries at your current economic level.