Common Mistakes Middle Class Make in Kenya



Which are the common mistakes middle class people make in Kenya?

As salaries stagnant, the middle income earners continue to make mistake after mistake. This population, which earns a median pay between Ksh 50,000 to Ksh 150, 000, define their future in a less cautious lifestyle.

Mistakes are common, but when it comes to spending, elimination of life-changing mistakes is critical. Here we pinpoint the worst/common mistakes the middle class make in Kenya that eventually put them into unending suffering.

  • Too much debt

Middle class especially town dwellers have a tendency of taking bank loans. It’s not uncommon to find an individual who is servicing a mortgage loan, soft loan, HELB loan and car loan concurrently. These loans have put millions of people in a mess.

It’s not a crime to take a loan but when the loan is taken to buy depreciating items like personal cars, clothes and house hold goods, becomes a target of poverty.

  • Not having an emergency fund

Emergency fund is crucial to anyone who wants to cater for emergency cases. Majority of middle class population have a tendency of utilizing their salary to the last coin. Assuming the trend continues until one retires, what do you think will happen to this person upon retirement?!!

  • Not saving enough for retirement

It’s a norm that more than 90 % of the middle class in Kenya only save in the NSSF.By doing so, they limit chances of having a decent life after they attain retirement age.

It’s advisable to save as much as possible to a pension scheme or provident fund. In case you lose your job, you can apply for the funds in a pension scheme.

  • Not having a side hustle

Honestly, if your monthly pay is Ksh 50,000 I don’t see how this money will sustain you until you save considerable amount for future use. Having a side hustle will not only save you the shame of losing a job, but also ensure you get extra income to put into investments.

  • Spending more than half on rent

This is like a trap! Most town dwellers spend more than half of their income on rent. In this scenario, little is spared for saving. A middle class person in this bracket is a slave of his employer and landlord .This person is often insecure and not ready to take risks because he fears his life can take a dip in case he loses his job. A mistake of this kind will make life stagnate and eventually the bearer becomes a shadow of his former self after retirement.

  • Not having a medical cover

An insurance medical cover is extremely important for middle class population. If you make a mistake of avoiding a cover and one of your members get diagnosed with a cancer, diabetes or hypertension, your bank account will be depleted faster than you can blink. It’s a good idea to spend Ksh 5,000 every month and avoid health related costs than wait until a major health issue is detected in your family.

  • Giving birth to many children

Middle class have a tendency of giving birth to more than two children. They even go ahead to marry a second wife. This is a serious mistake that can sink one into poverty.