A Kenyan man has taken to social media to share how he budgets his monthly salary, while asking for advice on his spending.
In a post published on the Nairobi City Facebook page, the unidentified user revealed he earns a monthly salary of Sh22,000.
In the budget, he allocated Sh7,500 to rent, food (Sh3,000), electricity (Sh300), transport (Sh500), and water (Sh100).
Other expenses include his mum’s allowance (Sh5,000), savings (Sh3,000), and leisure and borrowings (Sh2,000).
“Admin, I earn a net salary of Sh22,000. Kindly ask members to advise what I need to change,” he wrote.
The man’s spending sparked online debate with netizens advising him to move to a cheaper house or look for a side hustle to boost his income. Users also advised him to increase his savings and food expenditures.
Below are some of the advice from Facebook users:
Alfred Muia said: “Rent should be Sh3,000 or find a side hustle when free to earn the rent from other sources.”
Allan Poe: “Rent to savings, savings to rent.”
Ali Rato Ibn Karandini: “There are essentials such as airtime, personal groom missing.”
Kipngeno Timothy: “Look for a cheaper house, and increase savings.”
I’m 24 earning Sh30,000. How do I invest my Sh120,000 savings?
Collins Njiru a business analyst noted that while the budget is encouraging, it should be balanced, prioritizing needs over wants, while also leaving room for unexpected expenses.
“It’s encouraging that the individual is saving and supporting family, but the rent is too high for their income bracket, and borrowing for leisure is financially risky. A sustainable budget for a low-income earner must align with their reality, cutting unnecessary costs, boosting food allocation, and ensuring some provision for emergencies and health. Budgeting should not just be about survival but resilience,” Njiru told TUKO.co.ke.
Dominic Karanja, a personal finance and investment consultant advocates for the use of the 50:30:20 budgeting guideline: allocate 50 percent of your monthly income to essential expenses, 30 percent to discretionary spending, and 20 percent to savings and investments.
Karanja says that one should look for areas where they can reduce spending, as well as explore ways to boost their side hustle income by upskilling or taking on an additional project.
“As you near retirement, focusing on saving for it becomes essential. Building up your pension savings will help you enjoy a comfortable life after you retire and offer tax advantages. Set clear retirement goals and estimate the amount of money you’ll need.”
“Generally, it’s recommended to aim for 70-80 per cent of your pre-retirement income to maintain a comfortable lifestyle after retirement. Determine how much you need to save and develop a plan to reach that target. Start contributing to a retirement savings plan as soon as possible,” Karanja advised.
