Monday, May 27, 2024

Wanjugu: How I use bank and MMF to save my money

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Jane Wanjugu is the Finance Manager at Kenya Orient Life Assurance Limited.

My career started off as an intern at the East African Wildlife Society, a non-government organization. I then transitioned to general insurance at Kenya Orient Insurance Limited as an accounts assistant then progressed to the role of a senior accounts executive at the same company before moving to life insurance at Kenya Orient Assurance Limited, where I have worked as a financial accountant, assistant finance manager, and now my current role of finance manager.

The main challenge I Have faced in my role has been establishing a finance department from scratch. This required extensive research to ensure the right structures and processes were implemented. With the help of God and the rest of the team, we were able to put things in place.

Financial reporting and regulations have also evolved with time and this development has forced me to ensure that I strive to be up to date with the sector’s changes in a move to comply with the requirements while at the same time remaining relevant in the field.

My biggest money mistake happened when I took up an investment without prior budgeting. This happened early on when I started my career, I signed up for a life policy that required me to contribute monthly installments which affected my monthly expenditures.

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I ended up not being able to comfortably contribute towards my life policy cover and cater for my personal expenses at the same time, and as a result, I was forced to cancel the policy.

I ended up losing all the money I had initially channeled toward my life policy since the policy had yet to realize a cash value. I have since learnt from that mistake and adopted proper budgeting that entails availability, accessibility, sustainability, and affordability before making any money commitment.

My greatest career moment has been the transition from International Financial Reporting Standards (IFRS) 4 to IFRS 17 reporting. This type of reporting helps investors and others better understand insurers’ risk exposure, profitability and financial position and one of my major roles now is to prepare financial statements and reports in accordance with these standards.

This achievement has involved months of extensive training and consultations with the actuaries and peers in the industry. Undertaking this transition to make financial statements consistent, transparent, and easily comparable around the world has been a great achievement in my career.

Key on the list of what I would do differently would be my approach to investments. I would apply the 50:30:20 budgeting rule.  The 50:30:20 rule is a budgeting technique that helps in managing money in a more effective and sustainable way.

This rule involves dividing your money into three primary categories based on your after-tax income: 50% to needs, 30% to wants, and 20% to savings and debt payments.

I have two channels where I save money; In a bank account that pays a rate of return for the balance held and in a money market fund which has proven to be effective in helping me earn a return on interest thus growing my money.

Previously I would save money in an account with no rate of return which turned out to be ineffective because my money would decrease through standard charges.

Never live beyond your means. Avoid instant gratification. Everything we see as successful today has taken time and effort to get to where it is. Learn to go through the process as per the saying; ‘Easy come, easy go’.

A version of this profile feature on Jane Wanjugu of the Kenya Orient Life Assurance Limited was also published in the Saturday Magazine. The Saturday Magazine is a publication of the Nation Media Group.

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