A financial advisor has shared how Kenyans earning a net salary of Sh30,000 a month can begin building wealth, arguing that financial independence is possible even on a modest income if saving and investing are started early.
Benjamin Cheruiyot, a financial advisor at Abojani Investment, says the journey may be slower at the beginning, but the discipline developed on a lower income can become an advantage as earnings increase.
“A Sh30,000 earner actually has one advantage — you are forced to learn discipline early,” Mr Cheruiyot says.
He argues that a higher-income earner may have more room to spend on lifestyle expenses before taking investments seriously, while someone earning Sh30,000 can develop saving habits much earlier.
For such an earner, however, he cautions against setting an unrealistically high savings target that makes day-to-day living difficult.
Assuming monthly expenses of Sh12,000 for rent, Sh8,000 for food and Sh5,000 for transport, a Sh30,000 salary leaves Sh5,000. Rather than attempting to save the entire balance, Mr Cheruiyot recommends putting aside Sh3,000 a month and retaining the remaining Sh2,000 for other expenses and unexpected needs.
At Sh3,000 a month, the saver would accumulate Sh36,000 in contributions over the first year. Assuming the money is invested in a money market fund (MMF) earning a net annual return of nine percent and returns are reinvested, the balance would grow to about Sh37,664 after one year, Sh78,876 after two years, Sh123,968 after three years, Sh173,306 after four years and Sh227,290 after five years.
While Sh227,000 may not appear substantial, Mr Cheruiyot says the more important achievement is the financial foundation it creates.
“The wealth part is not building wealth on a Sh30,000 salary. You build the machine that will build wealth when the salary grows,” he says.
By the fifth year, the accumulated savings could provide an emergency fund equivalent to about seven months of the earner’s salary. This can reduce the need to rely on expensive short-term mobile loans when emergencies arise.
The savings can also become capital for investments beyond an MMF.
Mr Cheruiyot points to shares listed on the Nairobi Securities Exchange (NSE) as one possible avenue. For example, Sh227,000 would, at a share price of roughly Sh95, be enough to buy about 2,400 shares of KCB Group.
Based on KCB’s FY2025 dividend of Sh7 per share, 2,400 shares would generate about Sh16,800 in annual dividends, before any applicable taxes, assuming the dividend is maintained at that level.
The shares could also gain or lose value depending on market movements. Mr Cheruiyot notes that KCB’s share price had moved from about Sh80 to Sh104 in recent months, illustrating how capital gains can add to dividend income when a share price rises.
As the investor’s capital grows, the range of available investments can widen. Mr Cheruiyot cites infrastructure bonds (IFBs), multi-asset funds and other investment products as options that can be considered as an individual’s financial position improves.
The central lesson, he says, is to focus less on becoming wealthy immediately and more on establishing habits and capital that can support wealth creation later.
