A car is a necessity today but can easily derail your financial future if you try to impress others with an "eye-turning beast" on a low resource base.
Millennials & later generations are no longer about cars getting them safely from point A to point B.
Millennials & later generations are no longer about cars getting them safely from point A to point B.
They seek the most sleek and sturdy, fast and furious models that spit twin fires on their tails. Often with a huge dent on their finances.
Unlike baby boomers who bought cars after scaling their jobs, later generations acquire motors from their first year of employment. >>
Unlike baby boomers who bought cars after scaling their jobs, later generations acquire motors from their first year of employment. >>
While cars became convenience gadgets rather than status symbols, the competition has moved to maker and design, with older models falling in price. A 28-year old earning a Sh 100K salary would easily pick out a Mazda CX-5 from a showroom and desire a Sh 5M used Nissan GT-R. >>
While priorities differ on whether to buy a car or a plot first, the 28-year old will fund the Sh 2M acquisition at Sh 45K for 60 months, leaving no room for other investment. Is the car an asset? If it isn't for business, it's just a convenience - like a microwave, or fridge. >>
Except for an individual's wealth background, acquisition of appreciating assets first is advisable. Initial loan repayments towards depreciating assets that would soon be replaced at higher costs is ill-advised. Time is a valuable aspect in investments. >>
Assets acquired early in the career development phase (ages 25-35) multiply from compounding growth of value. A 50x100 plot in a commercially viable location will grow 2.5X in value over a decade. If bought at Sh 500K, such would potentially be worth Sh 1.2M. >>
Investments in the capital markets, SACCO deposits and government debt instruments will equally double at a modest 8% annual interest, assuming all earnings are reinvested.
A 28-year old without sound financial literacy would be busy sowing the wild oats here and... >>
A 28-year old without sound financial literacy would be busy sowing the wild oats here and... >>
...there, least concerned that parenthood is only nine months away. At 33, with a wife and child, the guy realizes he has to work twice as hard to guarantee a steady livelihood for his family. The frequent trips out of town with the "boys" in his beast must stop. >>
This life has balance, contrary to what many think. A well thought out financial plan will allow for both work and play. When work is prioritized, it pays dividends that permit play.
In the quest for financial bliss in the 40s, more assets over "flossets" is very strategic. >>
In the quest for financial bliss in the 40s, more assets over "flossets" is very strategic. >>
Driving the latest gizmos with piles of cash spread in various asset classes with total worth that's twice the cost of the wheeler is an orgasmic feeling.
You just can't describe it. You are certain you aren't cruising on the highway to poverty.
All said, work first. Then play.
You just can't describe it. You are certain you aren't cruising on the highway to poverty.
All said, work first. Then play.
Too Long, Didn't Read [TLDR]
• Get employed
• Build savings
• Borrow wisely
• Buy assets
• Let assets compound
• Use interests or dividends to buy "flossets"
• Enjoy life!
• Get employed
• Build savings
• Borrow wisely
• Buy assets
• Let assets compound
• Use interests or dividends to buy "flossets"
• Enjoy life!
Financial ignorance is bliss...
Until the inevitable happens.
A little knowledge is a dangerous thing,
Be misled in the right direction.
Until the inevitable happens.
A little knowledge is a dangerous thing,
Be misled in the right direction.
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