How to Know you are Living Beyond your Means

Have you ever wondered whether you are living beyond your means? How do you even know that you are living beyond your means in Kenya?

I know, there are all these talks about the economy being bad, about you not earning enough, but are all these excuses? Financial prudence is all about taking responsibility for all the money decisions we make, however bad they may be.

No one ever dreams of living a life of constant worry wondering whether if they can’t work tomorrow they will survive.

Trust me, I know its hard, you have parents to support, you’ve siblings to pay school fees for and you need to go away for a Gateway in Nanyuki with the girls. But don’t you think there is a better way to handle your money?

Join me as we identify the red flags early to know if you are living beyond your means in Kenya. We can start preventing a major disaster today.

Signs to know that you are living beyond your means in Kenya

  1. It’s normal for you to have loans from all mobile lending platform

In Kenya, particularly, it has become very easy to access quick unsecured loans online. For most of us, this has become the end of us.

If you have loans from Branch, Tala, Okash, Pesazone, Okolea, Zenka and any other mobile lending platform in Kenya. Then you are probably living beyond your means.

I understand that sometimes things might be pretty thick, but are things pretty thick all the time?

Some of us just borrow without even knowing the ridiculously high amounts that some of these platforms charge. Do you know how much you pay to get a loan from Branch than from Mpesa?

We just don’t care how much it will cost us as long as we get the money now!

2. Most of your spending is based on fear of missing out ‘FOMO’

No one wants to be seen as struggling by their colleagues or friends.

Ooh, they got a pretty dress from Mr. Price, I think I needed one too! In spite of this dress costing more than your rent. Yet you could have bought the same dress at Eastleigh at a pocket-friendly price.

It might also be as simple as wanting to party as much as James does, or live in the same neighborhood as he does. Yet James earns twice your salary and has parents who support him.

Don’t seek validation by spending yourself on debts. Learn to clearly label your wants and needs. Remember that social media lines and its not a competition.

Spending for the glam even when you are broke indicates that you are living beyond your means.

3. Your rent spending is more than 30% of your Net Salary

Suppose you are employed and your employer provides you with a house allowance, do you spend only that which he provides or less?  Or do you spend even more than what is provided?

According to most money specialists, your rent should or mortgage should be at most 30% of your total earning. Let’s do it practically:

Say my net salary is KES 25,000. I should be living in a house – 30/100*25,000 = 7,500. But no, we will go ahead and spend KES 15,000 to live in a one-bedroom apartment.

Paying very high rent is the biggest indicator to know that you are living beyond your means in Kenya. Do not move into a bigger house or a better neighborhood to impress people.

Impress yourself by making the right decisions.

4. You don’t have an Emergency Fund

If you are like me, I did not know about an emergency fund until today. How do you finance your emergencies?

It is not always a question of whether an emergency will happen or not, it is usually a question of when it will happen. Most financial experts advise that one should have an emergency fund that can cater for 3-5 months if you get out of a job.

Rember that your savings should be different from your emergency fund. Your savings are to help you safeguard the future while the emergency fund is for anything unexpected.

5. You’re not saving at least 5% of your earnings

The 50/30/20 rule directs than one should save/ pay debts with at least 20% of your net salary.

Since we are living in Kenya, and we don’t earn that much yet, how about saving just 5% of our salary? You could direct this to your pension scheme, the money market or any other investment.

Save for your financial freedom in the future. Remember you will not always be this energetic.

Sometimes it may be that you don’t make that much. How about taking up a side hustle? You could try out some online jobs to supplement your earnings. Or you could finally turn that hobby into something fruitful.

If you have no savings at all, then this is a way to know that you are living beyond your means in Kenya.

How to Know You are Living Beyond your Means
Luxury has a name

6. You have never created a budget

Why do we think organizations create budgets? Why is it that our country creates a budget and tries to stick to it?

Unless you know where your money is going, you will be unable to control your spending. Therefore, if you have never had a budget before, there some very innovative applications that can help you come up with one without sweating it out.

Some of the Wealthiest people confess to always creating an annual budget for their households.

Try out this free website Mint to start out. I will also try it and maybe I could review it in another post.

A budget keeps you grounded on your spending, if you don’t have one, it may be a sign that you are living beyond your means in Kenya.

7. You’ve been blacklisted by the CRB

I know there are so many reasons why one can be blacklisted. Maybe you don’t have a job yet but your HELB loan grace period has elapsed and now you have to start making payments.

However, most of us out here have been blacklisted because they failed to pay the loans they took. You never know the many doors that being blacklisted may cost you.

If you are blacklisted due to the many loans, then this is a true sign that you are living beyond your means.

8. You finance your getaways through loans

If you finance your getaways to Nanyuki, Mombasa and Maasai mara through loans, then you know you are living beyond your means.

Some of us even take loans from banks in order to pay for a trip to Dubai. Why would you want to do this to yourself?

It is okay to go for a Vacation, sometimes, we need a break from our lives. However, if you have to go for a holiday, set up a kitty to save up for your Vacation.

Better still, you can form a Chama with your dudes or girls solely to finance your vacation plans.

9. You make plans for the money that you don’t have yet

Do you count your chicken before they hatch? I know I fall to this trap many many times. There are times you get a very good deal online that you borrow to pay up.

This is another indicator that you are spending beyond your means. Sometimes, the money may never get to your pocket.

Please only plan for the money at hand.

You borrow to finance your getaways

Conclusion on how to know you are living beyond your means

Whether you are a low-income earner or middle class or even a high earner, it is possible to live within your means.

Here are a few pointers on how to successfully live within your means

  • Start making a budget – it could be weekly, monthly or annually. Whatever it is just make sure you know where your money goes.
  • Minimize your expenses – why should you buy toothpaste at KES 350 while you can buy the same brand of toothpaste at KES 200?
  • Save up for your major purchases instead of financing them with loans. You want to buy a car, then save up. or is it a fridge, you don’t have to get a Tala loan to buy it.
  • Get a side hustle – if you have always wanted to write, then start writing. Did you know that there is a lot of blogging side hustles out here? Know you Know.

I wish you all the best as you embark on living within your means. Remember it all for your good!


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Mary is one of the leading writers on Urban Kenyans. She is knowledgable on matters Kenya and has been able to educate many Kenyans on this platform.

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