What if I told you that the secret to financial freedom doesn’t start with a big salary or a business
empire — but with that little 500 shillings you usually spend on takeout or bundles?
Most young people believe investing is only for the rich — those with large paychecks or family
inheritances. But that’s a myth that’s keeping many from building wealth early. The truth is, you
don’t need millions to begin. You just need discipline, time, and a plan.
- Understanding What Investing Really Means
Before diving in, let’s get one thing clear — investing is not gambling. It’s not about guessing
Which company’s shares will make you rich overnight, or buying into every “get rich quick”
promise on TikTok.
Investing simply means putting your money into something that can grow in value over
time, instead of letting it sit idle in a drawer or current account.
The goal is to make your money work for you — through interest, dividends, or profits. You
sacrifice short-term spending for long-term gain.
For example:
● If you put KES 3,000 every month into a good investment earning just 8% per year, in
In 10 years, you’d have over KES 540,000.
● That’s the power of compound growth — your interest also earns interest.
This principle works best when you start early. Time is the most powerful ally for young
investors. - Why Youth Should Start Now
Many people delay investing because they believe they’ll start “when they earn more.” The
problem? Life keeps getting busier and more expensive.
Starting while you’re young — even with little money — gives you three big advantages: - More time for your money to grow — You can take advantage of compounding over
many years. - Room to learn from mistakes — You’ll make small errors when the stakes are still low.
- Financial discipline — Investing teaches patience, saving habits, and planning.
Even if you’re still in school or at your first job, starting now can put you years ahead financially. - Preparing Before You Invest
Before jumping into any investment, it’s important to build a strong foundation. Think of it like
building a house — you need to lay the base first.
✅
Step 1: Set Your Financial Goals
Ask yourself: What am I investing for?
● Is it to buy land?
● To build a business?
● To retire early?
Your goals help you choose the right investment.
✅
Step 2: Create an Emergency Fund
Start by saving at least 3 months of your living expenses in a safe, accessible place like a
money market fund or a savings account.
This acts as your safety net when emergencies arise — so you don’t sell your investments at a
bad time.
✅
Step 3: Pay Off High-Interest Debts
Clear expensive loans first (like mobile app loans or credit card debt). Their interest rates
usually exceed investment returns, making it hard to grow wealth. - Best Investment Options for Young People
Now let’s look at the real opportunities available for beginners in Kenya and similar markets.
You can mix these options depending on your goals and risk level.
A. Money Market Funds (MMFs): The Best Starting Point
A Money Market Fund is a simple, low-risk investment that pools your money with others and
invests it in short-term, safe assets like treasury bills and bank deposits.
● Returns: 8%–11% per year on average.
● Starting amount: As low as KES 500 or KES 1,000.
● Access: You can withdraw anytime — making it great for beginners.
● Examples: CIC Money Market Fund, Sanlam, Nabo Money Market, NCBA, or
Etica money market fund.
How to start: - Visit the company’s website or app.
- Fill in a short form (ID, email, M-Pesa number).
- Deposit via M-Pesa or bank.
- You’ll receive daily interest updates or monthly statements.
This fund is ideal for short-term goals or as your emergency fund. Many young Kenyans use
MMFs as the entry door to investing.
B. Treasury Bills and Bonds: Investing with the Government
If you prefer safety, you can lend money to the government and earn interest through Treasury
Bills (T-Bills) and Treasury Bonds.
● T-Bills are short-term (91 days, 182 days, or 364 days).
● Bonds are long-term (from 2 to 30 years).
They are some of the safest investments in Kenya because they’re backed by the
government.
How to start: - Open a CDS account at your bank or with the Central Bank of Kenya (CBK).
- Decide how much you want to invest (minimum KES 50,000 for T-Bills or KES 100,000
for bonds, though some funds pool smaller amounts). - Bid through your bank or broker — you can choose a “non-competitive bid,” meaning
you accept the market rate.
Return rates:
● T-Bills: Around 14–16% (as of late 2024).
● Bonds: 16–18%, depending on the term.
If you don’t have much capital, you can still access government securities through unit trusts or
investment apps that pool funds.
C. Stocks (Shares): Owning Part of a Company
When you buy a share, you’re buying a small piece of a company — like Safaricom, Equity, or
KCB. If the company grows, you benefit through dividends and price increases.
Stocks can bring great returns over time, but they also rise and fall — so they’re best for
long-term goals (5 years or more).
How to start trading stocks: - Open a CDS account (it’s like a digital wallet for your shares).
- Choose a licensed stockbroker (like NCBA, Genghis Capital, or Standard Investment
Bank). - Deposit your funds and research the companies you like.
- Start small — even KES 2,000 can buy a few shares.
You can also invest through Exchange-Traded Funds (ETFs) or Unit Trust Equity Funds that
are managed by professionals if you prefer a hands-off approach.
Pro tip: Focus on strong companies that have proven consistent performance — not hype.
Safaricom, KCB, EABL, and Co-op Bank are popular long-term picks.
D. Unit Trusts and Mutual Funds
If you don’t have time to monitor markets, unit trusts allow experts to manage your money.
Your money is combined with others and invested in a mix of shares, bonds, and money market funds
assets.
There are different types:
● Equity Funds (for long-term growth)
● Balanced Funds (for medium risk and steady returns)
● Money Market Funds (for safety and short-term goals)
They’re perfect for young professionals who want steady returns with minimal effort.
E. Money Market Apps and Digital Platforms
Technology has made investing easier than ever. Apps like Hisa, Ndovu, Mali by Safaricom, or
Chumz lets you invest from your phone with as little as KES 100.
These platforms allow:
● Fractional share buying (owning a small piece of stock).
● Access to local and global investments.
● Automated investing — where you schedule deposits each month.
They’re great for youth who want to invest consistently and learn as they grow.
F. SACCOs and Group Investments
If you prefer community-based investing, SACCOs (Savings and Credit Cooperatives
Societies are another option. They allow you to:
● Save monthly.
● Access low-interest loans.
● Earn annual dividends.
Some youth groups also invest together in land, business, or pooled funds — combining
resources for bigger goals. - Building a Simple Beginner’s Investment Plan
Let’s say you earn or can save KES 3,000 per month. Here’s a simple breakdown:
Investment Type
Monthly Contribution
Money Market Fund KES 1,000
Purpose
Emergency savings and short-term
goals
Treasury Bills
KES 500
Stocks or Unit Trust KES 1,000
Learning Fund
KES 500
Medium-term stability
Long-term wealth building
Courses or reading on personal finance
After one year, review your progress. Increase contributions as your income grows. The key is
consistency — not the amount. - Common Mistakes to Avoid
- Chasing quick profits — If someone promises you to “double your money in a week,”
run. - Investing without research — Always understand where your money goes.
- Ignoring fees — Some platforms charge high management or withdrawal fees.
- Lack of patience — Wealth grows slowly. Real investors think in years, not weeks.
Remember, steady progress beats risky shortcuts. - Final Thoughts: The Future Belongs to the Disciplined
You don’t need to wait until you’re rich to start investing — you become rich because you started
early. The world is full of distractions and expenses that can drain your money, but by choosing
to invest consistently, you’re choosing freedom.
Even small, regular investments — whether in a money market fund, T-bill, or stock — will grow
over time. The youth who invest early will be the ones controlling their futures tomorrow.
So start today. Open that first investment account. Save that first 500 shillings. Watch it grow.
Because the best time to start was yesterday — and the second-best time is now.
Sure Media Magazine 