While we’re witnessing the rise of digital currencies, money as we know it (legal tender) is still  a relevant part of every society. Right from time, money matters have been at the core of human  existence. Today even more – when all that glitters just may be gold – the discourse on personal  finance cannot be overemphasized.  

Between the rise of the internet as a necessity, to electronic gadgets and clothing, today’s youth  are faced with more pressures than the previous generations. To make matters worse, basic  needs are worth twice as much today than they were some years back. It follows then, that the  modern-day student must be twice as intentional about managing their finances if they must  overcome today’s challenges. 

Money tip 1: A Budget for each Wallet 

We’ve all heard the famous adage, “cut your coat according to your size”. And while this is  good advice, I don’t quite mean it in the generally understood sense of “spending according to  your level of income”. Irrespective of size, I would hardly be able to mention a tool more  effective at customizing one’s wallet to their reality than a budget.  

Budgeting guides your spending by allocating money towards specific needs. You see, a budget shouldn’t limit you, but rather provide freedom to spend money in ways that improve your life. 

Money tip 2: Build strong habits 

The financial habits you form at this stage may well last through adulthood. A job or other  income earning activity will seldom be the determining factor in how you handle your finances.  One thing it will do though, is test the strength of the foundation you built years earlier. Here  are a few practices I would recommend, to get you started on cultivating good money habits.  

✓ Tracking spending  

Know where your money goes! You have a better grip on your finances when you can  tell what proportion of your income goes where. Have you ever had a certain sum and  suddenly, it is all spent … yet you can’t say exactly what you did with it? It may shock  you when you begin to pay attention. Little, negligible sums spent casually do add up  over time. 

✓ Develop a savings mindset  

Setting money aside requires sheer discipline, grit, and determination. While “njangis”  have always been a popular method of saving towards a specific goal, technology now  affords us a myriad of savings and money management platforms. MyNkwa for  instance, enables users to set a target they hope to achieve by a pre-specified withdrawal  date, and start saving – with a penalty applied to withdrawals made before the set date.  The “Djangui” app is a digital njangi platform which takes the burden off secretaries  and treasurers by managing the entire finance of the njangi.  

These are only a few and they are so convenient, there’s hardly an excuse not to. The  key is to have realistic goals, bearing in mind that your savings must be an amount that  you are able to conveniently set aside. 

✓ One loan begets another 

Far from being the enemy, debt is much like that friend who can get clingy very easily,  so make sure you hold it for the right reasons – the key being what it does for you.

Depending on what the motive is (starting a side hustle, investing, or affirming your big  boy/girl status), two types of debt are easily distinguishable among students: bad vs  good debt. Irrespective of the sum requested, the first question you want to ask yourself  is, “will this debt pay off?” This simple question makes the difference between a good  and a bad loan. After you factor in the repayment of the principal, any interest accrued,  and the alternative uses of that money, does the debt still make sense? Are you getting  all your money back and then some?  

This goes both ways, whether you are the lending or the borrowing party. A thought  process like this will help you determine whether any debt is more burdensome than  beneficial. 

✓ Learn to tell your wants from your needs 

Have you ever run out of cooking oil, and then made a ‘quick’ stop at a shop only to  emerge several minutes later with a full bag of provisions? Or just walked into a shop  to “have a look around”? In either case, you would most likely end up buying things  you didn’t plan for or do not need. And while there is nothing wrong with treating  yourself to something nice, remember to save a space for these extras in your budget  (think miscellaneous). Regardless, discipline and moderation are encouraged. As a rule,  if you are going to shop for groceries, please make a list – and stick to it! 

✓ Learn to be frugal, not cheap  

The difference?  

When you are frugal, you spend money intentionally and use it as a tool to improve  your life (aka making purchasing decisions that are value-for-money). 

When you are cheap, money is a source of conflict and anxiety (basically, you know to  spend a certain sum on your needs, but consistently find ways to cut corners).  

If you’re one to compromise quality for price, be prepared to pay double. 

Money tip 3: Comparison is the thief of Joy 

There will always be someone in a better financial position than you. That they can comfortably  afford more doesn’t make your circumstances dire. Know and live within your means.  Remember, debt is not always the answer – sometimes, cutting back on your spending is. If you are comfortable borrowing once, you will do it again and again. Just strive to be the best version of yourself (whatever that means for you). 

Bonus tip: Too many finance gurus, too few students 

Everyone is an expert when it comes to managing other people’s money – and even running the state’s budget – but seldom when it has to do with theirs. If you must take financial advice from anyone, look at how well they have fared with it – simple!