The 45 days of January

It is that time of the year again. December and the holiday season are upon us. Your employer will pay your salary early, and there’s the added benefit of bonuses, commissions and the 13th cheque. For entrepreneurs, it is high season, and the goods are practically flying off the shelves.

With more money comes the need to spend more and the holiday season is the perfect excuse to lose our minds. We’re paying for holiday trips, buying gifts and shopping for new cars, clothes, shoes, forgetting that in two weeks, life goes back to normal. You will still have the same job, the same salary and the same obligations.

January won’t care that your mantras in December were “Drinkcember”, “Tumia pesa ikuzoee” “Shukuru mwili, it’s been a long year”, “You only live once”, “2020 is over” and “Jaza tank hadi itapike”. You still need to pay school fees, buy new school supplies, pay your rent, pay for transport to work and keep you and your family fed. For some, the revenues from this high season will need to sustain you for 2 – 3 months before business picks up again. Forty-five days of Njaaaaanuary are coming your way inevitably.

Before you spend all your money, I must encourage caution. You have a surplus, and that’s a great place to be. You can take it as an opportunity to enhance your financial stability or you can decide to spend the first half of 2021 recovering from your folly in 2020. Here are some tips to curb your spending this December.

Prepare a plan: Make a list of all you need to accomplish with your December income, and you might stop yourself from impulse spending. Along with your bills, contribute some money to savings and investments as well as leisure. Remember, there’s no other salary between now and the end of January, make sure you cover everything.

Evaluate your expenses: Do you really need that new TV right now or can you save for it slowly and buy it later? Is it best to travel now when the fare rates are very high or travel in January when things are cheaper? If you must travel now, when is the ideal time to travel? Before the 25th, on the 25th, after the 25th?

Prepay expenses: If you cannot trust yourself to leave the money in the account until it is time to pay your bills in January, make the payments now. Pay your rent, school fees and buy the school supplies as soon as you get the money. That way if you overspend, you have already taken care of the bills.

Limit your access to cash: When I have ready access to cash, I tend to spend more. Sometimes, I even lose money. If you don’t have physical cash or easy access, you’re likely to spend less. Move your January transport to your savings account, so you don’t accidentally use it. Leave your credit card at home if you’re concerned about spending more than you intended, and set a limit of what you can spend on impulse. It’ll nag at you if you go above it and may curb your spending.

Do not borrow to spend: I know you’ve seen those messages. “Dear Fatma, you qualify for a KES 12,000 loan from our App. Apply now and receive the cash within 24hrs.” These messages are tempting right now but as the Swahili saying goes “Kukopa harusi, kulipa matanga”. I fully understand ambition and the desire to have a better life, but this better life can only be temporary if you’re funding it with debt.

What does it mean to reward yourself? At the end of the year, we all want to reward ourselves with merrymaking. Yet, there is so much more to rewarding oneself. You can turn rewarding yourself into an investment.

• Invest in your career: Take a course, build your skillset and experiences, network to build relationships. These investments ensure personal and professional growth that enables you to continue to earn and increase your future earnings, thus enhancing your financial health.
• Invest in your future: What financial goals do you want to achieve? How can you use your regular income to achieve these goals? A stable future begins with the decisions you make now. Make decisions about savings and investments that will secure your future.
• Invest in your family: Some people are out here spending that well-earned bonus earning the envy of friends and family. Remember, you’re not in competition with anyone. Your journey is yours. Instead, invest in making memories with the people that matter.
• Save and Invest: Create a new habit of paying yourself first. And no, I don’t mean buying new clothes, shoes, cars or paying your bills. I’m talking about setting aside a portion of every income you receive for investments. If we only ever work to pay the bills, we are not growing. Any financial shock can send you into distress. Accumulating assets is a reward for your hard work that can give you the financial freedom to get out of a lousy job, to invest in your passions or fund the growth of a side hustle.

Lastly, stick to the plan. It is December. We’re enjoying all these holidays, and some of our companies have closed down for the festivities. We have more time to meet friends and family we haven’t seen for a while and may succumb to the pressure to show our success. I repeat, your journey is your own, and you are not in competition with anyone. You don’t want to compete yourself into financial distress. Avoid people that call you “Boss”, “Mheshimiwa”, “Mkubwa”, “Mzito” or pressure you to impress. You do not need to pick up the tab to show your success. Remember the plan.

Do let me know if this has been helpful or if your quick visit to the shop in pyjamas and slippers turned into a road trip to Baringo. I won’t judge. Happy holidays!