It’s common knowledge that most people struggle with how to save money in Kenya on a low income, and studies are there to prove it. One Business Daily report, for instance, shows that Kenya has a much lower saving index than the average saving index of Africa, which is currently at 17%.
According to the report, our East African neighbors, Tanzania and Uganda, perform much better at above 20%, which means we’ve some catching up. And while going through the report, the explanation is that financial illiteracy and limited financial incentives are the primary explanations for the poor saving culture in the country.
That’s why we, as Cent Warriors, are determined to teach people about saving, even on a meager salary.
‘By definition, saving requires us not to get some things now to get bigger ones later,’ – Jean Chatzky.
So, we’ll talk about 30 ways you can make those little sacrifices today for a more livable future. In summary, here are the 30 issues we’ll talk about.
30 Ways to Save Money with Low Income in Kenya
- Create a budget
- Have savings goal
- Set financial priorities
- Automate savings
- Stay away from loan apps
- Clear outstanding debt
- Watch your money grow
- Lock your savings
- Try the MSHWARI 52-week challenge
- Adopt the 48 hours waiting rule
- Leverage the retirement savings plan
- Buy in bulk
- Don’t buy on impulse (shop with a list)
- Buy used
- Buy discounted
- Coot at home often
- Look for free/low-cost entertainment
- Cut down on unnecessary transport costs
- Learn to DIY
- Repurpose old items
- Cut down on energy costs
- Avoid water wastage
- Eat healthily
- Cut out expensive habits
- Shop on a full stomach
- Cancel unnecessary subscriptions
- Buy from the market, not grocery stores
- Meal planning
- Try Staycation
30 Creative Ideas On How to Save Money in Kenya On a Small Salary
Let’s now discuss ways you can save up money in Kenya even when you are not making much:
1. Create a Budget
‘A budget is telling your money where to go instead of wondering where it went,’– Dave Ramsey.
Most people, not just those on a small income, can’t save because they can’t plan for their finances.
No matter how much you make, you cannot save consistently without a budget. You can start with a spreadsheet or use a budgeting app like My Budget Book or Money Manager.
Not only will these options allow you to plan for your money correctly, but they’ll also help you to track your spending.
Remember, the goal is to allocate some of your income to savings, and we recommend the Zero budgeting method where you allocate all your income to specific goals based on where you are in your life.
Additionally the 50/30/20 budgeting rule is a simple method to guide you on the appropriate percentage allocations when you’re starting out. That enables you to append 50% of your income on necessities and 30% on non-necessities (or wants). The remaining 20% goes into savings and paying down debt if you’ve any.
2. Have Savings Goal
Goals motivate you, and having them when planning to save will catapult your savings plan. Start by setting a target whereby you plan to save a certain amount daily to reach a specific figure at a particular time.
Let’s say you make Ksh 50,000 and put 20% of that into savings and debt repayment using the 50/30/20 rule.
That means you’ll have Ksh 10,000 for your savings and loans.
Now, suppose you use half of that to pay down your debt. Then you’ll have Ksh 5,000 every month untouched, and that equals Ksh 60,000 a year.
While Ksh 60k may look small for some projects, what if you save for 3– 5 years? Then you will have enough, especially if your money grows, as I explain in number 4.
Its also good to note that we advocate savings after you have cleared all your debts. That means that, with no debt, you’ll be able to apply the 20% in your savings.
3. Set Financial Priorities
The difference between overspending and saving is defining your priorities. If you know what’s more critical financially, attend to it first. You’ll avoid spending money on the wrong thing or borrowing to meet a vital need.
You have to define what you need and give it a priority. For example, you must buy food, pay rent, school fees, and other household expenses. However, you don’t have to go on a trip, eat out every week, or buy every trendy cloth. Once you do that, you can save and avoid borrowing.
4. Automate Savings (Pay Yourself First)
‘Don’t save what is left after spending but spend what is left after saving,’ – Warren Buffet.
We know that it can be perplexing to stick to your budget. If so, learn to pay yourself first, and that requires you to automate your savings so that some money goes into savings automatically as soon as you receive it in your account.
That means you only spend after saving. Talk to your bank about it, and they’ll set up everything for you.
5. Stay away from Loan Apps
Loan apps are a trap that quickly disrupts your savings plan and other financial goals. The moment you borrow, you’ve to pay, which means less money to save.
Debt steals your most powerful tool in wealth creation; your income.
So, if you want to save more (remember the 50/30/20 rule), you should avoid borrowing by all means.
‘Never spend your money before you have it,’ – former US President Thomas Jefferson.
Sadly, loan apps trick you into spending money you haven’t earned, and you have to pay it with your savings.
6. Clear Outstanding Debt
While it’s clear that you’ve to stay away from loan apps so that you can save more, it’s also clear that you should pay down and clear your existing debt.
Remember these words by celebrated finance book author Nathan W Morris;
‘Every time you borrow money, you rob your future self.’
You surely wouldn’t want to do that! If so, make plans to start repaying your debts, and we recommend the debt snowball method, where you start paying off your debt from the smallest to the biggest as you build momentum and celebrate every milestone.
7. Watch Your Money Grow (with the Best Saving Plans in Kenya)
It’s not just a matter of saving; opt for a savings plan to grow your money. So, it’s more like investing. From our research, here are the best savings plans in Kenya:
- Money Market funds – This is offered by different insurance and investment firms and will give you an average of 7%-10% in returns. This is our best recommendation compared to bank saving plans discussed below.
- Simba Savings Account by KCB Bank – where you earn a 5% per annum interest on your savings, there are no monthly fees, and the opening balance and minimum balance are Ksh 1,000 each
- AHADI Savings by the National Bank – where the annual interest is 5%, the opening balance is Ksh 1,000, and there are no ledger charges
- EazzySave by Equity Bank – where the annual interest rate is about 7%, and there are no monthly charges or minimum operating balances
- Pure Save by Stanbic Bank – where the annual interest is up to 7%, and you enjoy free MPESA transfers
- Gold Savings Account by NCBA Bank – where the interest rate starts from 3.5% to above 6% depending on the amount saved, and there’s the advantage of one-free monthly withdrawal and mobile banking
- Hekima Savings Account by Cooperative Bank – where the annual interest starts from 3%, and there is no minimum opening or operating balance or monthly charge
Other remarkable savings plans worth checking out are Zidisha Bonus by Absa Bank, Safari Savings by Standard Chartered, and Tujenge by Family Bank.
8. Lock Your Savings (Best Way to Save Money in Kenya for A Definite Period))
If you are the type who always goes into your savings and spends it unnecessarily, you should try to lock the money. That restricts you from withdrawing anytime you want, which means hefty penalties.
For example, you can try the Target Savings or Fixed Savings Account by KCB Bank, which allows you to lock your money for 1 – 2 months and earn a 6.3% annual interest.You only need an opening amount of Ksh 500, and you can lock as much as you want.
KCB also has the Goal Savings Account, which allows you to lock your savings for at least six months, and you can do it for up to 5 years.
You can also try the savings lock plans offered by MSHWARI, Family Bank, and Equity Bank (Jijenge) and other banks.
9. Try The MSHWARI 52-Week Challenge
The MSHWARI 52-Week Challenge is a Safaricom savings program that encourages its customer to save with MSHWARI for a year. The goal is to save Ksh 68,900 at the end of the year, and this is how it goes:
- Start saving Ksh 50 the first week into your MSHWARI, Ksh 100 the second week, Ksh 150 the 3rd week, and so on.
- When you reach the last week of December, you’ll save Ksh 2,600 (Ksh 50 multiplied by 52 weeks.
- If you add everything, you’ll have Ksh 68,900. And since the 52-week challenge is a savings plan, the money earns an annual interest of 6%.
10. Adopt The 48 Hour Waiting Rule
It’s easy to buy on impulse without financial discipline, but you probably agree that we often buy things we don’t need, and that’s where the 48-hour waiting rule comes into effect.
Here’s how it works:
Take up to 2 days to think a particular purchase through, and if you still think you need the item, get it if you can afford it. But if you think you don’t need it after 48 hours, drop it.
Doing so will save you from spending so much on non-necessities.
11. Leverage The Retirement Savings Plan
‘Someone is sitting in the shade today because someone else planted a tree long ago.’ – Warren Buffet
These nuggets of wisdom by American Billionaire Warren Buffet talk about saving for future retirement.
If you want a comfortable retirement, even while earning peanuts, start depositing something into your retirement plan. For example, the most popular one, the NSSF (National Social Security Fund). NSSF savings earn an average interest of 7% annually, another way to grow your money.
Note: There are other retirement funds with better returns than NSSF that are offered by private investment companies.
12. Buy in Bulk
You will likely save on most household items if you buy them in bulk. That includes toiletries and food, whose prices you can’t predict.
So, once you get the opportunity to save, pounce on it. Remember, if you buy in bulk this month, you won’t have to purchase the items next month or the other two, translating to more savings.
13. Don’t Buy On Impulse – Shop With A List
It’s easy to buy on impulse when you don’t have a list. So, to stay on budget and observe financial discipline when shopping, learn to create a shopping list in advance.
You don’t have to write the exact prices as they are likely to change, but you can estimate. What’s important is defining what you want and the amount you need.
14. Buy Used (How to Save Money Wisely in Kenya On Shopping)
Secondhand items may not be so appealing, but they allow you to save up to 20-50% on most items. That includes furniture, house furnishing, baby gear, tools, and equipment.
Provided the item is in good shape and comes at a fair price, you can get it and put whatever you save in your savings account. Meanwhile, if you’ve something that you don’t need, sell it off and keep the earnings.
15. Cook at Home Often
You don’t have to eat at restaurants and drink coffee at local cafes daily. If you are conscious of your spending, you probably have noticed that you spend a lot.
You also don’t have to call meal delivery services every time you are at home. That’s unnecessary spending, especially when you have the time to cook.
Learn to buy food supplies and cook meals, saving you a lot of money. You can even pack the food to work or for the kids to school.
16. Buy Discounted
While buying in bulk promises significant discounts, it’s not the only way to save money on household purchases. Learn to hunt down discount deals.
Sign up for the supermarket newsletters or ask them about discount deals. A supermarket like Naivas always advertises its discount deals on TV. So if it’s something you need, go for it.
Remember, ‘a bargain isn’t a bargain unless it’s something you need,’ according to American screenwriter Sidney Caroll.
17. Look for Free/Low-Cost Entertainment
We all should enjoy life; it’s not a crime. It, however, does not mean breaking the bank to have it. You can still have fun with free and low-cost options.
For example, going on a picnic, camping, or park touring is cheaper. It’s also cheaper to tour the city with the kids, go to the beach if it’s a close distance, and visit the local market.
You don’t have to grab the next plane to an exclusive resort to have fun. You can even stay at home and cook together, watch a movie, learn to play an instrument, or go biking. It’ll be fun yet cheap.
18. Cut Down On Unnecessary Expenses
Transport costs can be financially draining for commuters if you are not careful. You can, however, bring the price down using these ideas:
- Walk when you can
- Bike to work if it’s possible
- Only drive when it’s necessary; otherwise, take a bus
- Share a ride with other family members heading your way
- Sign up for a ride-sharing to make some money on the side
- Regularly maintain your car
- Get the most affordable but fair auto insurance
More Ideas On How to Save Money Every Day in Kenya
19. Learn to DIY
You don’t have to call someone whenever you want something fixed at home, take care of the garden or clean around. There are some things you can do yourself (DIY).
And even if you don’t have the skill, you can learn how to do it from YouTube. That includes these tasks:
- Cleaning the house
- Fixing the plumbing or lighting
- Remodeling the kitchen and bathroom
- Landscaping and gardening
- DIY work also involves making home cleaners that you can sell and save money.
20. Repurpose Old Items
Old is gold, so goes the saying, and so you don’t have to dispose of everything at home because you no longer need it. Everything can be helpful, and you only need to discover its use, and that’s where the idea of repurposing comes in.
For example, you can use an old window frame as a picture frame, mason jars as solar lanterns, old farm tools as home decor, and an old ladder as a bookshelf or kitchen rack.
You can use broken mugs as candle holders or old shutters as wall decors. Remember, there are no rules, and you can therefore repurpose anything.
21. Cut Down On Energy Costs at Home
Much money goes into electricity, and if you ask a Kenyan who has been paying for electricity for the last few years, it’s more expensive now than ever.
However, it doesn’t mean you’ve to pay that high. Here is some idea you can implement to bring down the cost:
- Switch off the light and appliances when not in use
- Wash with cold water often
- Reduce how often you use the water heater
- Iron less often
- Switch to more energy-efficient light bulbs (LED options)
- Don’t cook with electricity (use LPG gas as its cheaper)
22. Avoid Water Wastage
Energy is not the only cost you can cut when you want to save. You can do the same for water. For example, you don’t have to use the in-house toilet all the time when you have an outdoor line.
And when speaking of the in-house toilet, you can always use the remaining water after doing your laundry.
It also helps to use the water economically when doing laundry, and, more importantly, you should take advantage of rainwater and turn off the taps when not in use.
23. Eat Healthily
Most people assume you can only eat healthily when you have more money. Wrong!
Healthy foods may be expensive, but it doesn’t apply to cuts. For example, what costs more, traditional greens or canned meat?
It must be the latter. How about soda and water? Now you know. Here are some ideas you can use to eat healthily and get to save:
- Plan for your meals (explained later)
- Buy fresh vegetables and fruits direct from the farmers’ markets
- Grow vegetables at home if you have the space
- Shop with a grocery list
- Always preserve healthy leftovers for the next day
- Take more water instead of bottled juices and sodas
- Take more meat alternatives like soya beans, black beans, and chicken peas
- Make meals at home (already explained)
24. Cut Out Expensive Habits
Some habits are just too expensive to keep when you want to save. For example, saving is hard when you are a heavy drinker; the same goes for cigarette smoking.
Other expensive habits you should cut include eat-outs, movie dates, regular coffee dates, expensive grooming, car renting, gambling, and fast foods, to name a few.
25. Shop On a Full Stomach
It’s dangerous to go shopping on an empty stomach. That’s when you are likely to eat expensively and overspend. To avoid the temptation of breaking your budget, ensure you fill up before walking into the supermarket.
You can eat at home or at an eatery you are comfortable paying for. That can also help kids because they are the ones who can’t control their hunger.
26. Cancel Unnecessary Subscriptions/Memberships
Some subscriptions are unnecessary when trying to save—for example, streaming services like Netflix and ShowMax or pay-tv services.
You can do without them to enjoy free-to-air TV channels. Though they won’t offer you quality content, you’ll still have something to watch.
How about memberships?
You can cancel gym memberships and work out at home using YouTube or a free mobile workout app and get to save. So, look around you to see the kind of subscriptions and memberships you can cancel to start saving.
27. Buy from The Market, Not The Grocery Store
If you can access the market, buy your grocery supplies there and skip the grocery stores unless necessary. You will likely save more while getting fresher produce at the market than at local grocery stores.
Besides, this is also an opportunity to buy in bulk and score bigger discounts.
28. Reduce Housing Costs
Your house is another area where you will likely use more money you could otherwise save. Remember, we are not just talking about energy, water bills, and food, but also the rent.
For example, you can always downsize if you are not a huge family, saving you some money on the rent. And if you cannot downsize, then relocation is an option.
Move to another area where you can get the same house size for less. And if you can’t move out because it’s your family home, you can always rent an extra room to earn some rental income.
29. Plan Your Meal
You need a meal plan if you find it hard to decide what to cook and always buy the most expensive ingredients. And since we are avoiding subscriptions, we will talk about meal plans.
Instead, we recommend having a home menu outlining what you’ll cook each day. That allows you to shop for groceries with a list and stick to your budget. Note that it doesn’t have to be expensive but healthy and affordable.
30. Try Staycation
Lastly, since your goal is saving money, going on a vacation could be a huge mistake. That doesn’t mean you shouldn’t consider it.
How about you take one within your town or city? That is what Staycation is all about, and it can be enjoyable yet cost-saving as you don’t have to travel a lot.
Ready to Start to Save Money in Kenya On a Low Income?
We, as the Cent Warrior family, can help you get started on this fantastic journey. We recognize that saving is not easy, and one may need some help along the way.
Our team can help you choose where to save money in Kenya; where we explain options like an emergency fund, savings accounts, mutual funds, retirement accounts, and money market funds.
Talk to us on social media about how to save money in Kenya, and we’ll be glad to help!