My name is Roseline, and I’m 18 years old. I’m currently at university and receive funding from the Higher Education Loans Board (HELB). I’d like advice on how to manage my HELB upkeep money more prudently. I receive Sh30,000 per semester, and my essential expenses are minimal since I live with my parents and don’t pay rent or food costs. I want to save this money for the future or invest it in a savings account where it can grow at a good interest rate.
The main reason I’m seeking help is that I’ve realised I’m not spending this money wisely. Last semester, I wasted all of it on unnecessary things. Now, I want to save and invest in upgrading my skills, such as learning to drive (which will cost around Sh20,000) and completing a barista/mixology course (around Sh35,000). Additionally, I’ll be moving to Kerugoya for my attachment in April, which means I’ll need to rent my own house. Could you kindly guide me on how to manage this better?
Gertrude Njeri is an accountant, personal finance and investment consultant. She works as a community manager for an investment company based in Nairobi.
There’s no such thing as a free lunch. The money you receive from HELB is a loan that you’ll eventually need to repay. Acknowledging the need to use this money more wisely is commendable, especially at your age. At 18, you’re already thinking about savings, investments, and skill-building—this puts you ahead of many of your peers.
To start, it’s crucial to understand that every effective financial plan begins with good budgeting. How well you manage your Sh30,000 each semester will depend on your budgetary allocations. Let’s create a practical plan to ensure your money works for you, even as you prepare for your attachment in Kerugoya.
Step 1: Budget your HELB money using the 50/30/20 Rule
Since you don’t have rent or food expenses, you can allocate your money as follows:
Needs (50 percent): Sh15,000 for savings towards April’s rent, transport, and living expenses.
Wants (30 percent): Sh9,000 for your barista/mixology and driving courses.
Savings (20 percent): Sh6,000 to invest in a Money Market Fund (MMF) for growth.
Money market funds protect your cash from inflation and earn compounded interest, meaning your returns generate further interest daily. While returns may start small, the focus at your age should be on building financial discipline and understanding how money grows. MMFs are also easily accessible in case of emergencies. Over time, you can increase your savings as your needs decrease.
Step 2: Set clear savings goals
You have three main priorities:
1. Prepare for your attachment in Kerugoya (April 2025): Estimate your rent, transport, and living expenses. Save Sh15,000 now and keep it in an MMF. If your parents provide additional support, you can adjust your withdrawals accordingly.
2. Invest in skills: You need Sh55,000 in total (Sh20,000 for driving + Sh35,000 for mixology). Allocate Sh9,000 per semester, and consider side hustles like event catering, social media management, or tutoring to speed up your savings.
Step 3: Build better financial habits
Track your spending: Use a budgeting app or notebook to monitor every shilling. This helps identify areas to cut back and boost savings.
Avoid impulse buying: Before purchasing, ask yourself if you really need the item. If unsure, apply the 7-day rule—wait a week to see if the purchase still feels necessary.
Find affordable alternatives: Look for second-hand books, free online courses, or discounts on skill-building programmes. Don’t neglect your academic pursuits, as they’re crucial for your future career.
Step 4: Explore income opportunities
Consider small income-generating activities to boost your savings. For example:
Take up weekend barista gigs at local cafés.
Offer home-based catering services to friends and family.
If you have money-related questions, email us at [email protected] with your contact number. We’ll address them in this column.
