It’s that time of year again; where everyone looks at their financial achievements for the year past and begin prepare for the coming one.
The first cardinal rule to achieving your financial goals is to plan. With less than a month left until we cross over to the New Year, which comes right after the festivities that make individuals dig much deeper into their pockets, it is important to have a plan on tackling the expenses and opportunities that come with the year 2016. These expenses range from rent, school fees, mortgages, insurance and debts among others. Calculating your net worth and having a financial plan to ensure you live within your means is essential to making informed decisions when it comes to saving for future growth as well as looking at potential investment opportunities that are sprouting in 2016.
Here are a number of things you need to consider as you prepare to begin the New Year.
Retirement: Is your employer contributing towards your retirement? No? Well, you need to ensure that you have a plan in place for this. Compare the options at your disposal, in which you can reap optimum benefit and which are reliable.
Education: Good education is expensive education. It is therefore crucial to plan ahead and ensure that your children’s future is guaranteed. You owe them that.
Emergency: with the current times where there is so much uncertainty when it comes to job security, it is important to save at least six months ahead so you are not caught by surprise when you suddenly lose your job.
Generally, consider your income and expenditure for the year 2015 and see where you could use some improvements to be a better spender and planner in 2016.
Saving/Investing: In terms of investing, you are looking at a market of more than 145 million people and a combined GDP size of about US$147.5 billion, in the five East African Community member states.
When it comes to investing, government tenders, buying shares, investing in SMEs and start-ups are increasingly becoming popular among investors in the region. Manufacturing and distribution of fast-moving consumer goods is also another option you might consider putting your money in.
In 2011, the regional bloc- EAC- signed framework agreements with the USA and China with the aim of boosting commodity trade, exchange visits by business people and co-operation in investment among others. The region has since attracted a lot of interest from the globe owing to its strategic positioning in the continent as well as its vibrant market.
According to the recent annual Doing Business Report by the World Bank, at least two countries have made major improvements in terms of starting a business. These two countries – Kenya and Uganda – have improved efficiency of their regulations by reducing costs and complexity. It now takes a much shorter timeframe to obtain a permit for starting a business and even lesser associated processing costs, the report notes.
Regional governments are now also working towards attracting FDIs into the region by using several methods. Generous incentives have been offered to investors. There is abundant labour force – educated, trained, mobile, skilled and enterprising.
A look at the sectors that international firms are investing in will give you a general map on the various opportunities you should be looking at. The information technology sector, agriculture, oil and gas, tourism, infrastructure, and financial sectors are some of the options available for investment especially with the East African Community gearing towards regional integration.
Whether or not you decide to take on this coming year with a profound plan in matters finance, the entire region is moving ahead – rapidly so. It is therefore a time to reflect, weigh options and make informed decisions as they pertain to your future so when January finally comes around, you do not find yourself with a ‘too much month to the end of your money’ situation.
You however need to be cautious about setting too many or unrealistic financial goals. Otherwise, you may be unable to accomplish any of them and get frustrated as a result. You might want to keep a checklist to guide you throughout the year and keep you focused on your goals.
Finally, you would do well to hire a financial advisor to consult on matters finances.
By Kawira Mutisya