I am single in my mid-30s. I earn Sh130,000 per month. My monthly spending is as follows: Rent Sh28,000, meals (I dislike cooking and prefer to eat out) Sh20,000, car fuel Sh10,000, car loan Sh17,500, entertainment Sh10,000, self-care Sh18,000, black tax Sh5,000, boyfriend allowance Sh5,000.

I like soft life, but I have become increasingly agitated that I don’t have most of the investments that people earning less than half of what I make have. I don’t have shares, bonds or even an MMF.

However, I have savings of Sh620,000 in a bank fixed account that I locked up a couple of years ago. As I inch closer to my 40s, I want to get my act together and start thinking about my financial future. I want to start a side hustle and start making investments.

I want to explore life, and I would also like to travel abroad with my boyfriend at least once or twice per year, but I don’t know how to start saving for this. Can you please help me? I feel pretty clueless! June

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Muthoni Njakwe is the author of Her Shilling, Her Power: A Woman’s Guide to Financial Freedomm, a personal finance book

First, I must commend you for your honesty. It takes a certain level of self-awareness to look at your finances in your mid-30s and admit that, despite earning a reasonable income, you are not where you would like to be financially.

You earn approximately Sh130,000 a month; you are fully responsible for yourself; you have a car; you pay your own rent and bills; and you have managed to save Sh620,000 in a fixed deposit. The issue is not necessarily that you are earning too little. The issue is that most of your income is currently being used to maintain your lifestyle, leaving you with very little consistent surplus to build wealth.

Where your money is going

Your current expenses are approximately Sh113,500, leaving about Sh16,500 before miscellaneous expenses and mobile-loan repayments.

I would not advise you to completely give up the things you enjoy. The important question is whether your lifestyle is affordable and whether you are also setting money aside for your future. Right now, most of your income is financing the life you are living today.

Read: 'I earn Sh40,000, how do I become a homeowner in eight years?'

Don’t try to become extremely frugal.

You don’t need to stop eating out or suddenly live like someone earning Sh50,000. Instead, you need to create a reasonable monthly surplus.

For example, you could reduce eating out from Sh20,000 to around Sh15,000, entertainment from Sh10,000 to Sh7,000 and grooming from Sh18,000 to around Sh12,000. You could also review the Sh5,000 you spend on gifts.

The objective is to create at least Sh15,000-Sh20,000 of reliable surplus that is deliberately directed towards your financial goals.

Deal with the mobile loans.

If you are regularly using mobile loans to get through the month, make clearing them a priority. Once they are gone, redirect the money you were using to repay them towards savings and investments.

Read: I took a Sh800,000 loan behind my husband’s back and got scammed. How do I repay it?

Your Sh620,000 in the fixed deposit is an excellent starting point, and I would not advise you to withdraw it. First, set aside Sh100,000–Sh200,000 as your emergency fund. This should cover several months of your essential expenses and protect you if you lose your job or face a major unexpected expense. Keep this money somewhere safe and reasonably accessible.

The remaining can become your starting investment capital once you have cleared your mobile loans. You don’t need to invest it all at once. You can begin with a money market fund or other low-risk option while you learn about Treasury bills, bonds, shares and diversified funds. As you continue earning, use your monthly income to build your investment portfolio rather than putting your emergency fund at risk.

Learn, then start investing

You are concerned that you don’t have shares, bonds or an MMF. Don’t let that pressure you into investing in something you don’t understand. Take the next few months to learn how different investments work, including MMFs, Treasury bills, government bonds, shares and diversified funds. Also look at your pension and retirement savings. You don’t need to become an investment expert; you simply need to understand where your money is going and what level of risk you are taking.

Read: I earn over Sh100,000 but little to show for it. Where is the leak?

Once your mobile loans are cleared and your emergency fund is in place, start investing consistently. You could begin with Sh15,000 a month, which would give you Sh180,000 in a year. As your income grows, increase your contribution.

Increase income

Your HR experience allows you to earn additional money through consulting, recruitment, career support or another business you can manage alongside your job. You don’t have to build a big business immediately. Start small, prove the idea works and grow from there.

June, approaching 40 is not a deadline; it is an opportunity to become more intentional about your financial future.

Read: I’m a police officer earning Sh58,000, but I take home Sh4,900. How do I escape debt?

Imagine reaching 40 with no expensive debt, a solid emergency fund, growing investments, additional income and money set aside for travel. You don’t have to give up the life you enjoy. You already have an income, savings and a career. What you need now is a clear plan and the discipline to follow it.

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