Image is not Wealth – Financial Illiteracy is the Root to Most of your Money Problems


If you think the only reason you have many problems is because you don’t have enough money, then I think it’s time you rethought that. As Waceke from Centonomy advices, sometimes the root of your problems is your financial illiteracy.

I always say, we get the leaders we deserve and from the recent debate from MPs and their salaries, Waceke agrees that most Kenyans suffer the same problems the MPs do. Kenyans and their MPs have a very special attitude to money and failure to adjust this attitude, will lead us down the Zimbabwe route.

More money will not solve your problems.

The MPs argued that the gazetted salary was “inadequate to sustain their lifestyles” meaning most are living beyond their means. If today your expenses are equal to or greater than your income, you have a problem. You will carry the same destructive habits into a bigger pay slip and when you get into the same jam you will continue to think the answer is a bigger salary. This cycle will never stop.

If you cannot manage €10 you cannot manage € 1 million. Our MPs first need to manage and live within the current salary just like we must within our own incomes. We all (MPs included) need to get out of this lifestyle prison i.e. working for a lifestyle. Since lifestyle can always be increased  – there is always something new to buy or a more expensive place to eat lunch – it is a dead end and will result in poverty. Let us all make cuts today where we need to and focus our future ability to create income; not on consumption but on wealth creation. Delayed gratification is an important principle for all of us to embrace. What we have been seeing recently with our leaders is the unmanaged desire to have it all today rather than work progressively towards it.

Image is not Wealth.

The MPs have also been pushing for increased allowances to buy luxury vehicles.  Not just functional vehicles but luxury vehicles.  Can you see the irony here?  People who cannot sustain a lifestyle on a gross income of over half a million shillings should not be contemplating the purchase of luxury vehicles.  Not withstanding that the country cannot afford it, they also cannot afford the expenses that would come with these vehicle. Many of us make this same vital mistake of spending huge amounts of money for an image that we cannot afford to maintain and one that is depleting our ability to invest.  This Kes 7 million car will not even be worth half of that in 5 years.  It may fool people that you are wealthy but just because you drive a big car doesn’t mean you are.  There is a lot of poverty being driven around in luxury cars. Those who have created wealth are those who have been able to harness the ability to multiply resources including money.  When you have Kes 7 mn and choose to spend it on a depreciating item such as a car, you are not multiplying it but depleting it.  You may look wealthy to the financially illiterate but you will never be wealthy.  If you have access to some money please think of how to grow it and generate income from it instead of spending it on lifestyle.

I believe the MPs may be also trying to live up to their titles. They probably believe there is a certain way an MP should look. You may also get a promotion at work or a big title.  Don’t succumb to the image pressure associated with your title and spend on liabilities. Let your work at the end of the day speak for you not just your job description. You cannot buy the respect that comes with actual performance with a luxury car. It may fool the “fools” for a short term but it is not sustainable.

Waceke is the founder and CEO of Centonomy® Ltd a Financial Literacy Institution that teaches individuals about management of their Personal Finances. Find her at| twitter @centonomy| www.facebook/centonomy

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