Posted by:  Benjamin Wanjema   On   March 07, 2018

This being a new month when people are loaded with money, I thought it is a good opportunity to write about credit and financial freedom. I have asked some of my friends what financial freedom means to them. I always get lots of answers. Some say it is when they can earn money without having to wake up early in the morning; others think that entrepreneurship leads to financial freedom. I would not want to burst anyone’s bubble, but I would like to pass some truth humbly. There are lots of businessmen/entrepreneurs out there who are not financially free. Financial freedom does not come with getting more money. I work as a credit officer, and the truth is that businesses are struggling with credit and so are entrepreneurs. So what is financial freedom? Financial freedom is when one is able to eliminate debts. There are people whose pay slips read six-figure salaries; however, by the time it gets to the banks, they are earning less than a quarter of the original figure.

Debt does not start as an obvious problem. For most people, it is the lack of personal finance knowledge that leads them to make poor decisions on how they spend their money. For example, the moment Safaricom introduced “Okoa Jahazi” and “M-Shwari” most people saw it as a more natural way of getting extra money to call, message, surf, and cash for emergencies. The truth is; the moment you figure out that you can easily access money, you start spending more and more because, hey, the money is just a click or a swipe away. Well, you can use’ Okoa Jahazi,’ ‘M-Shwari’ or any other money borrowing site; but,  you have to know its money you will ultimately pay back.

We live in an era where people want to have money throughout the month but are not ready to prepare a budget. These are the same people who will buy anything that appeals to their eyes. I had a friend who asked me to take him to the shop to buy some clothes. Before we got into the shop, I asked him how much he had budgeted, and he told me a rough estimate of “around 5Gs”. Surprisingly, we walked out of the shop having spent double the amount. Just because a shopkeeper offers you credit; it doesn’t mean you have to spend more. The shopkeeper is doing his work; he has to make you buy more.

If you want to be financially free, you have to learn to live as per you means. Have a budget, have the right attitude towards money, know that money will not always be there and make sure you follow us for more tips on credit and debt management.

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