While many end up in high-end joints with their friends for some bites and drinks, other visits boutiques to change their wardrobes. This is but the beginning of money problems unless soon addressed.

BT spoke to Jackline Mugo, a certified investment adviser, about the smartest things to do with your money when you start earning.

Before throwing an expensive bash, thinking of a vacation or going on a shopping spree, consider these money moves.

1. Seek financial management tutorials

According to Ms Mugo, you can start seeking for financial advice long before you have the cheque in hand or the money hands in your bank account. This, she says, will give you a better guide and knowledge on how to prioritise your spendings, doing your budgets and starting early savings.

“ Many people who lack financial management skills do not actually know what to do with their cash. As a result, they might end up squandering the whole amount and more especially when they know that they are on payroll,” she says. Your money will always wait for you so take time and understand how to manage it before making a move.

2. Settle you debts

First jobs come with their own challenges. For example, lack of fare to your workplace can compel you to borrow from friends or relatives with the hope of paying with your expected salary. Before you do this, you need to do your maths and know the amount of debt you can pay with ease.

“ Never go for debts that will take you long to pay. When you get your money, prioritise clearing all the debts so that you can have easy in planning with your cash,” she says.

Paying debts on time also increases your credit rating among friends and relatives when you get back to them for more debts. Do not go for debts if you can survive on minimal finance.

3. Start an emergency fund

This might seem to be a long term plan, yes, but remember sometimes life takes its own course. You can lose your job anytime, get sick or even find your house broken into and everything gone. It is important, according to Mugo, to have a safety net just in case. Ideally, you’ll never need this money — and it’s important to keep your hands off it for anything other than a real emergency.

Having multiple accounts is one of the tricks that will help you keep off from this money until real emergency strikes. Always consider putting it in a high-yield savings account, which offers a higher interest rate,” she says.

4. Set specific saving goals for future expenses

Once you start earning, expect bigger expenses in future, such as buying a car, home or educating your kids. The earlier you start setting aside money for these expenses, the better.

” The most effective way to save for these big-ticket items is to have a certain amount of money automatically deducted from your bank account and sent to a savings account, says Mugo

“Do it on the same day you get paid. You’ll never even see that money and it’s a really easy way to make sure you stay consistent with your savings.”

5. Get the insurance you need

Many people have the habit of evading insurance covers with a feeling that they can make monthly savings. However, according to Mugo, this might turn against you at the end of the day.

Buying the right insurance policy for your situation is critical to a healthy financial life. “Try and shop around for the best policy and start your contributions as early as possible,” she says.

Insurance, according to Mugo, is a very important part of our daily lives and as such, should be given a key priority. “ Never let it wait if you can pay it,” she adds.

6. Start some side hustle

Does this look unrealistic to you just because it is your first pay? If it does, then look at it positively. There are simple businesses that one can start with as low as Ksh 500.

“ Walk around, identify what is lacking in your area, you can capitalise on that to help you in other areas,” she adds. Starting a small business is also important because you will no longer rely on your salary alone since once it establishes itself, you can easily settle your daily expenses with the profit and invest your salary in other venture.

Credit: Cavin Odhiambo reporter with Business Today

But an overflowing bank account isn’t out of reach for every millennial. In fact, there are plenty of millennials who will take the same route Mark Zuckerberg and Snapchat’s Evan Spiegel took. Here are eight things millennials can do to have a shot at becoming multimillionaires by 2027.

Start a business.

This option gives you the best odds of becoming a multimillionaire in the future, but success is obviously not guaranteed. A winning idea is, of course, a very important ingredient, but you should also know other things you’ll need to do to improve your odds of success. Above all, be prepared to put in years of hard work and overcome multiple obstacles before you achieve your dreams.

Find a mentor.

Some of the most successful people in business today will readily admit that outstanding mentors played a significant role in their career growth. Studies connect mentorships to a surprising number of success stories. Find someone who has achieved the type of success you hope to earn someday and ask for the opportunity to learn from that person. Their insight and experience may make the difference that helps separate you from other millennials looking to succeed.

Develop a product.

In today’s Shark Tank-Kickstarter environment, it’s possible to invent a product concept, create a prototype, and get funding to begin manufacturing and distribution. There are multiple ways to approach taking your idea from concept to reality, but you’ll give yourself a great head start if you create something that is inexpensive to produce.

Take over an existing business.

Why start at the beginning when there are existing businesses that need ownership? Search for a business with an owner who may be interested in retiring or who is actually ready to move on. Be prepared to work with the business for some time before eventually offering to take it over. If you have difficulty locating one, a business broker can help you identify the perfect business to suit your personal and professional interests.

Invest

Investing can be tricky, but it’s one of the best ways to get a return on the money you currently have. If you want to make significant money quickly, you’ll need to take some major risks, which means being willing to lose all the money you put in. For best results, start by investing a good amount of money. You can make more potentially if you risk more. Pick certain sectors that you find yourself most interested in and concentrate on investments in those spaces. Before any of this though, take time to learn as much as possible about the stock market.

Save

With the nearly nonexistent interest rates on savings accounts today, you likely won’t see the money you put into the bank multiply. However, if you make significant sacrifices, such as living at home with your parents, working multiple jobs, or sharing a place with one or more roommates, you may be able to set aside a considerable part of your salary each month. Like my mom always said, you can’t save much money if you’re busy spending it just to live. If you conserve over time, you’ll have a nest egg you can put toward investing or purchasing rental property that can more rapidly multiply your monthly income.

Start a side hustle.

If you need the security and benefits that come with a salaried position, a side job may be a great way to generate extra income. This could be something as simple as delivering pizzas or bartending or something as complex as starting your own business on the side. The former can bring immediate cash, but the latter can give the long-term benefit of eventually being able to turn it into a full-fledged business.

Boost your salary.

The key to successful saving and investing is to first bring in the best income possible. Don’t settle for a substandard salary. Look at the market rates for your skills in your area and make sure you’re at least within the range. If not, search for a different job with people who will appreciate your education and experience. Learn top salary negotiation strategies to get the most out of every job offer.

With hard work and sacrifice, millennials can significantly increase their income over just a few years. While there’s no guarantee of becoming a multimillionaire, it’s well worth the effort. If you don’t succeed in that timeframe, at least you’ll have a good start at becoming a multimillionaire in the years that follow.

Credit: John Boitnott, contributor at Entrepreneur

God helps those who first help themselves. In the world today, we ought to treat money with some care and respect. You will always want things to buy, but you don’t have to. One must have a plan of where they want to go, more so a discipline to execute the plan.

With money, comes responsibility, which many people lack. There are things that could be keeping you from being money-savvy. It is time you jumped off that bandwagon of mistakes and correct them.

Dr Manyara Kirago, who is a well-known personal finance coach and trainer in Kenya, currently running online training on financial management, gives a ten-point guide to mistakes that people often make.

Not having a plan for your finances

As individuals, we ought to have financial goals in life and a plan of how to achieve them using the only money we earn, not what we yearn to have. This is the only way you will live a debt-free life, translating into a stress-free life. Always plan what to save or spend and how. “First analyze your financial position then set goals according to you cash flow. Most importantly, have regular review of your progress,” advises Dr Kirago.

Focusing on lifestyle instead of financial security

“Financial security equates to ownership of invested assets,” says Dr Kirago. Lifestyle includes things such as buying clothes for show-off or going with current fashion rather than investing, as well as eating in the finest restaurants in town.

Not having a budget

This could lead to living from day to day without saving, or spending all your money and ending up borrowing to continue spending. A wise man would put in his budget what he or she plans to spend. This will have your money in order.

Not having an emergency fund

We are advised to always expect the unexpected. A good example of this is a job loss due to retrenchment. You are not ensured against job loss for the rest of your life, there is always someone coming up and taking over. “In case anything happens, you ought to have money that will keep you going a good 3 to 6 months,” he says.

Getting in trouble with loans

Most people lose their hard earned properties to loan recovery agencies, who auction them to recover defaulted loans. Dr Kiragu advises that you should service your loan promptly, and if you can’t don’t take one.

Guaranteeing other people’s loans without regarding the repercussion: This will see the loaners come after you if the debt is not settled because your name is on the paper. Unless you are prepared to pay for it, don’t be a loan guarantee.

Not saving for retirement

It is said that one should start saving for retirement immediately they get a job. By doing so, you are securing yourself financially in the future when you are at a much older age.

Not having health insurance

In most cases, people start seeking fundraising in order to seek medical help. If you paid for health insurance, it becomes an easy ride.

Not having life insurance

This money will provide cover for daily living expenses and any outstanding debts such as credit cards and car loans, in case you die or are not in a position to work.

Not having a will, especially if you have minor children

This is your final will and testimony. You have the power to distribute your life-earned money and assets to your family ensuring they continue living comfortably after you are long gone.

Credit: Abigael Tairo, contributor at Business Today

While most people would consider themselves pretty financially savvy, I’d say that can be attributed to the fact that no wants to admit they’re bad with money. As cash rules almost every decision we make, it can be tough to swallow when we haven’t held ourselves to the best standard.

Granted, for most of us, it’s easier said than done, but that’s why getting into good habits while you’re young is so imperative. That’s why I’ve compiled a few tips I wish I knew when I was in my 20s. Following these could lend you a better path and help you save quite a bit as well.

1. Report your rent to credit bureaus

Although a relatively new development in the credit reporting world, according to NerdWallet, nearly every major credit bureau allows you to report your rent. Although less than 1% of credit files contain rental information, this can increase your credit score tremendously.

2. Learn how to use a credit card the right way

This is something that we probably should’ve listened to the wisdom of our elders more, but then again, sometimes it’s best to learn on your own. As creditcard.com notes, while younger generations tend to utilise their credit for clothes, entertainment and gas, older generations use it for travel and major repairs. Granted, having a budget and sticking to it with a credit card can be a good way to build your score, but using your card like boomers is an effective strategy.

3. Don’t inquire until you know for sure

Credit inquiries can negatively impact your score up to five points, which is especially damaging to young people. The rule of thumb here is to shop around a bit when it comes to buying something that could need to be purchased on credit.

4. Build your credit

Your credit is the number-one key you have to financial freedom, so utilise it wisely. As CreditRepair notes, there are numerous ways you can start on this, as it’s never too early to start thinking about your credit.

5. You don’t have to be rich to invest

There’s a big notion that only those with a lot of money should invest in stocks or mutual funds. In fact, a recent study by Bankrate showed that just one in three millennials are investing. Even though you most likely won’t be rich overnight, it’s never a bad idea to use investments as a way of saving. Some good sources to check out are Acorns and Stash.

6. Save enough for rainy days

According to a study by GoBankingRates, 72% of millennials have less than Ksh 103,235 (US$1,000) in savings. That’s a pretty astounding figure, especially when you consider that money could be drained pretty quick in the event of an accident or unexpected event. Try to set aside a little more from each paycheck, as you never know when it might come in handy.

7. Hold off on buying a car (even if you can afford it)

While a lot of folks tend to follow the 20% rule (that is, only dedicate 20% of your income to a monthly payment on a car), even if you can afford that, it’s still not your best investment. First, cars are depreciating assets, meaning as soon as you drive off the lot, it’s automatically worth less than what you paid. Additionally, as you never know what’s going to happen with your car (whether it’s new or old), the unexpected maintenance or expenses are going to cost you regardless.

8. Beware of predatory lending

Predatory lenders can potentially destroy your financial status, with the average interest rate clocking in around 400%. In short, this is the quickest path to bankruptcy, so if you’re looking for some extra financial help, exhaust all your resources, as well as possibly talk to a financial advisor.

9. Stop spending so much money on socialising

Like most millennials, I too have fallen victim to spending money for what I consider “the short term.” You know, things like going out to eat or going to shows, which for the time being is great, but as you get older, you realise this money is well spent other places. Plus, as millennials spend nearly 44% of their food budget on going out, cutting back can be an excellent way to save money.

10. It’s harder to get yourself out of a hole than it is to get in one

It’s no secret that getting into debt is relatively easy. But the getting-yourself-out part? Not so much. As The Nest points out, the average time to pay off Ksh 980,399 (US$9,500) with monthly payments of Ksh 47,575 (US$461) will take approximately two years, with Ksh 160,476 (US$1,555) paid towards interest. In short, being in debt is expensive, and as such, you should put a lot of consideration into what you incur before pulling the trigger.

Perhaps one of the best pieces of financial advice I ever heard tackles this subject very well: if the debt you’re incurring isn’t helping you make money, is it really worth putting on?

Credit: Andrew Medal, contributor at Entrepreneur

For every quote on resilience there is probably a failure business that motivated its birth. Chances are you will not make it big in your first venture or first try at your business. Failures are part of entrepreneurship and success stories are easier to sell, you might not hear of the failures of many people who have made it.

Successful entrepreneurs are defined by their attitude. The willingness to learn lessons from your business failure will determine your chances of being successful. 20% of new businesses fail after a year in operation with about 40% of the successful businesses closing after 5 years.

While failure in business is common, it is however not a walk in the park. A business failing can strain your finances, relationships and your confidence in yourself.

What to do after a business fails.

Analyze your failure to figure out what went wrong

You may not feel like dwelling on it, but when a business fails, it is crucial to analyze every aspect that could have led to the failure. Find out what went wrong, where, how and why. Start by looking at what you wanted to achieve when you started the business and if you were able to accomplish it. If not, why not.

Did your product or service fill a noticeable niche in the market, did it have any competitive edge and did you communicate your value proposition clearly. Did you collaborate well with partners and employees? Look for any blind spots that could have contributed to your business failure to avoid the same mistakes costing you more in future.

After pinpointing what went wrong, you will be in a better place to determine whether you can improve on your idea or get a different one and start over.

Is Entrepreneurship the right choice for you?

Businesses are not for everyone, depending on your strengths you may realize that your personality and skills might not be sufficient to run a successful business. Before starting another business that could damage your finances, consider getting a full-time job for the immediate future to get back on your feet.

Read more on if entrepreneurship is the right thing for you at http://milhanaccesscapital.com/determine-whether-entrepreneurship-is-the-right-path-for-you/

Stay Positive

Getting excited again after a business failure is not easy, staying down is not an option either. Take note of things you enjoyed doing in your business to remind yourself of your passion for starting out in the first place. Look for ways you can maximize on the returns while noting down things that strained you that you can delegate or hire someone.

Look for mentors that can guide and jumpstart your enthusiasm. Talk about what you are struggling with, your mentor can offer business tips that might steer you in the right path.

Rise above your failure

Failing means you took a risk and went for what you wanted, not everyone can do that. If anything, it should give a boost to your confidence. Embrace the lessons that your failure brings. Do an audit/SWAT analysis. Determine the mistakes that you can correct and pick yourself up.

How to be a successful entrepreneur

Your success as an entrepreneur will be determined by your mental and emotional strength. Be of strong mind, have a willingness to sacrifice, be able to commit and have unwavering determination.

Be mindful of your circle of friends and have the right mindset

Mindset changes that successful entrepreneurs make.

Complaining does you no good– Complaining is a complete waste of time, hardships and challenges will undoubtedly arise, complaining about them gets you nowhere. Have the will to pick yourself up after difficulties and learn from your mistakes.

Learn from your failures– Every failure is a learning opportunity. Do not allow your mistakes to define you. Treat failures and mistakes as learning opportunities.

Get used to being uncomfortable– Comfort zone is not even an option when it comes to entrepreneurship.  Discomfort is part of running a business, you will have to push yourself outside your usual limits to stay on top of your game.

Keep an open mind- When times are good, you may be tempted to maintain the same way of doing things. It is however necessary to find keep abreast with new technology earlier on.

Take risks– Your business success and growth will be determined by your ability to take calculated risks. Challenge the status quo, have a curious mind, question everything, seek knowledge, understand why what works, works.

Believe in your idea– Your faith in yourself and your ability to execute your business idea and prevail in times of hardship is the make or break of your business. Believe in your eminent success and work diligently to make it happen.

The time of getting yourself a car has arrived, depending on your budget and the kind of car you have always wanted, you are now trying to decide whether to put your money into a new or a used car. While buying an old car can save you thousands upfront, buying a new car has its advantages.

However, before you are enticed by the feel of a new car, start by evaluating how much you will be saving by buying a used car instead. The average person in Kenya owns about 6cars in their life time, if each of these cars are about 3year old, you can calculate how much you will be able to save on each car purchase.

How Depreciation can save you money

Depreciation has been used in negative light but when it comes to buying a car, it is the real money saver. Understanding how car depreciation work equals to figuring out car buying’s secrets. A car loses 20% of its value the moment you buy it, after a year of mileage, wear and tear, it loses about 10%, and this is barely noticeable until the day you decide to trade in or sell your car.

Let’s take a look at two similar vehicles, a new car and a used car.

New Car Depreciation– A new car loses around 30% of its value after one year. If you bought the car at Ksh 3m and sold it 3 years later for Ksh 1.5m, the car will cost you Ksh 1.5m in depreciation.

Old Car Depreciation– On the other hand, if you had bought the same car but three years old at Ksh 1.5m, you can sell the same car after a 3 year period for Ksh 1m at a deprecation cost of Ksh 500000.

Driving a new car feels terrific but it will cost more in the long run. Of course there are stigmas surrounding buying used cars but that shouldn’t stop you from saving a huge amount of money.

Advantages of buying used cars

Vehicles are now more dependable than ever before in two ways;

Maintenance– One can drive today’s cars for longer periods in between regular maintenance like oil change, brake jobs or tire rotation. Tires and brake pads last longer in today’s car than earlier versions.

Reliability– Today’s cars can deliver up to 100,000miles without requiring any major repairs hence you will not be buying someone’s problem according to common misconceptions.

Lower car insurance rates– A car’s value determines the insurance rates especially collision and comprehensive coverage, the less the car’s worth, the less it will cost to insure.

Cheaper Registration– The cost of registry renewals/ registering a used car lowers each year.

Less stress– We all spend more time paying attention to a new car, the first dent on a new car is likely to give you more headache compared to a dent in an old car

Get a Luxury car– Buying a used car saves you enough more to buy a more luxurious car than a cheaper new one.

Advantages of buying a new car

Buying used cars has one great benefit of saving you money, however buying a new car has its perks.

Better financing options– Auto and Logbook loans lenders offers better interest rates on new car loans or car buying incentives like Import Duty Financing.

Shopping is easier– Compared to buying used cars, new-car shopping is easier. All new cars are assumed to be in perfect condition and do not require being taken to a mechanic.

Advanced Features– New cars has enhanced technology for better performance, safety, and comfort, a feature obviously that lucks in old cars.

Prestige– New cars gains you respect and envy from peers, it is hard boasting of buying an old vehicle.

Peace of Mind- A new car comes with a warranty of up to 3 years or 30000 miles, it’s also more reliable than a used one.

So, New or Used

There are times when purchasing an old vehicle will not cost more than buying a 2 year old vehicle. This is because not all car brands depreciate at the same speed. Some brands maintain their value well for longer periods of time.

Depreciation can be your dirty little car buying secret. If going for a used car, go for one that can hold its value, this will minimize any effects. If you are not still sure, use a car loan calculator to see the difference if you choose to buy a new one instead.

Almost every business needs some form of capital to kick off. While some people are capable of funding their startups, not everyone has the same ability. There are different kinds of financing for your business including borrowing from friends and family, loans or saving. However, depending on the size of the business and the opportunities for growth, entrepreneurs might consider other sources of funding like Angel Investing.

Angel investors are individuals who invest their money, not to be confused with money managers who invest other people’s money. Angels are well off individuals in different fields or successful business owners who can offer finance as well as expertise on different fields.

Angels are willing to take a risk on startups and unique ideas than lenders, venture capitalist and professional investors. The internet has eased up the process of searching for angel investors with many funding websites coming up every day such as Kenya Angel Investors.

The difference between Angel Investors and Venture Capitalists

While angels exist to offer seed financing to startups, venture capitalists rarely provide funding for startups and prefer becoming involved after the business has kicked off. Venture capitalists seldom use their money to fund business, they use institutional money to invest. Venture capitalists have the responsibility to invest in companies that will earn high rates of return, they can also be part of the board to ensure the company is going on the direction they see fit.

Angels put money in a venture that appeals to them personally. This doesn’t mean that they are ready to invest, however, this makes them an easy target to reach than venture capitalists since they are easy to research on. Venture capitalists on the other hand are a tougher crowd to capture, because they will invest more money than angel investors since their main aim is reaping more from their money.

Create a sales pitch about your business, the shorter the better since you do not have much time to convince them. Seek to capture their imagination immediately. Angel investors are more like mentors while venture capitalist function as the board of directors, both of them however will require you to give away part of the ownership (Equity) of your business.

Almost every business needs some form of capital to kick off. While some people are capable of funding their startups, not everyone has the same ability. There are different kinds of financing for your business including borrowing from friends and family, loans or saving. However, depending on the size of the business and the opportunities for growth, entrepreneurs might consider other sources of funding like Angel Investing.

Angel investors are individuals who invest their money, not to be confused with money managers who invest other people’s money. Angels are well off individuals in different fields or successful business owners who can offer finance as well as expertise on different fields.

Angels are willing to take a risk on startups and unique ideas than lenders, venture capitalist and professional investors. The internet has eased up the process of searching for angel investors with many funding websites coming up every day such as Angel Investment Network

So how do you find Angels willing to take a leap with your business?

Networking Events and Investors websites

Lenders are coming together and providing a platform for entrepreneurs and small-business owners to showcase their business or pitch their idea. Be on the lookout for such events happening around your area with an elevator pitch ready that shows the enthusiasm you have for your venture.

Angel Investors are mostly interested in the person behind the project, your drive, your decisiveness and innovation and how you are able to sell yourself and the project. There are different websites where small businesses can meet angel investors including Angel Capital Association, Angel Investors can join as an individual.

Angels are unconventional and some may not resonate with your idea, a rejection should not be interpreted to mean that your business is not viable or sustainable, they personal belief, interests and preferences may not agree with your new business.

While Angel Investors will take a risk on you, you are more likely to land a backer if you do not require a whole lot of money since essentially our idea is unproven hence uncertain. Angels tend to start small before pouring all their money into your business depending on how it is shaping up.

Tips for finding an Angel investor for your business.

What are you looking for?- The typical angel investor is over 40 years old, has a net worth in excess of 1 million with an income exceeding hundred thousand, has successful entrepreneur experience, can hold on the investment for not less than 3 years and has knowledge on your industry. Angel Investors search for companies with potential for growth, they may not mind waiting till their investment pays off but expect to be compensated handsomely for their risk.

The closer to home the better– Many angel investors are likely to play an active role in the business hence they prefer investing in businesses that are close to them.

Network, network and Network some more- Chances are you will meet your Angel investor through referral, for this to happen, you will need to build a good network. Be active in your local business and social scene, attend networking events and get your company name out there by meeting as any people as possible. Look out for business owners they might be angel investor you need or know one.

Angels rarely fly solo– There are many Angel who invest on their own, but the majority work as part of a group or network where they can pool their resources together, this in part means they share the risk.

Get your proposal to a wider audience– There are dozen websites providing a platform for angels to connect with small business owns looking for funding. They include Angel Investment Network

Angel investors are not just good for financial help, they come in handy with the know-how of certain industries which can be key in your business success.

Accounting in a small business involves keeping the books to identify waste, fraud, theft and tax purposes. In order to ensure your business remain successful and saves money in the long run, it is important for entrepreneurs to hire professional accountants. Most owners might prefer to do it themselves or delegate to other staff which can be detrimental to the business, successful companies have gone broke due to fraud, theft, unpaid taxes and even embezzlement.

Some of the most common accounting mistakes that small business owners make include entering data incorrectly, not documenting expenses and income or just basic math errors. Here is how to fix some of the bookkeeping mistakes.

Disorganization

Organization is a priority in accounting. Document and keep records of everything, use the business credit and debit cards for expenses and keep receipts for all expenditures. Maintain updated books and be sure to note down petty cash expenses the moment you incur them. Do not mix personal and business finance, while this may be unavoidable at some instances, be sure to indicate it as a loan to the business and get receipts on the same. Auditors will rarely challenge expenses supported by receipts.

Putting of the paperwork

Business owners especially during the beginning are forced to wear many hats to get a good hold of the business. Postponing to update your books might seem trivial but may affect the business in big ways. Avoid getting behind on filing reports, bill payments, invoicing clients and the financial statements which can lead to increased debts, bounced checks, and mistakes that you might not be able to iron out after time has passed. Always keep your books current not to miss out on financial opportunities.

Math Errors

Entering the wrong date or figures in the wrong place, rounding off incorrectly could cost you dearly in terms of paying taxes or hurt your small business finances. This is where professional accountants come in.

Hiring the right staff

This point cannot be stressed enough, delegating your book keeping to unqualified staff is one of the major mistakes that small businesses make. If the people you have put in charge of your accounts do not know what they are doing, your business will be the one to pay for those errors. Besides, not everyone has your best interest at heart and they may not be invested so much in the business to care on correcting errors and ensuring the books run smoothly.

Be willing to delegate

Small business owners are hesitant to delegate since they may feel like they are giving out power to experienced professionals. However, your business growth and ultimate success will depend on your ability to involve professionals who will handle the parts of your business that you may not be competent to manage.

The business will benefit more when you focus on what you are good at and allowing others to do their jobs. Expert advice is required for maximizing income.

Communication

Keep a clear line of communication between yourself and your book keeper to avoid accounting mistakes like filing records and reports which will affect the financial data. Reconcile statements and note down any expenses like employee bonus or cash discount.

Bookkeeping tips to avoid Accounting Mistakes

Tracking Receivables

Your small business could be losing revenue by not tracking receivables, your business could have good potential for revenue with little to no money coming in. create a system of managing outstanding invoices to avoid losing money on some accounts which can in turn mean looking for a loan to cover expenses. Consider investing in invoicing software that can send reminders to clients such as Vyapar

Tracking Purchases and expenses

Not tracking expenses, payments or bills and fees will result in discrepancy between the money you are spending thinking you have and the actual amount in your business accounts. Start by tracking small purchases that adds up over time including petty cash to avoid misuse.

Validate your purchases and income

One of the danger of messy book keeping is overpaying taxes. Inaccurate record of business expenses could mean more deductions that your business have to.

Bottom line

While there are many ways to prevent accounting mistakes, the person entering the numbers should do so correctly and be able to interpret assets, taxes and other financial matters. But more so, that person should be a professional accountant.

Make clear record keeping a priority to avoid rushing to complete books for financial transaction which could mean making mistakes in a hurry that will waste more of your time correcting or cost your business dearly. Keeping organized records everytime will you give a clear picture of the business income, expenses, profits and cash flow.

Saving money is important for accomplishing ones dream of owning a car, a home and even having a family. We come loaded with good news though, you don’t have to be a financial expert or accountant to succeed. Read on for some useful tips on how to save money.

Set out your goals

How do you want your life to be? Do you want to travel more? Pay off loans and live debt free? Do you want to buy a home or a car? However you envision your life, most likely the plan needs money. In order to achieve these dreams you need to set out an account that you can be putting in money every month.

It’s not enough to day dream, write down your dreams/goals and an estimate of how much it will require to  achieve that goal and the amount of time you have until  you attain it. Have a clear plan for your financial goals, it will give you something to look forward to and work for.

What’s your monthly spending?

Part of creating a budget is calculating how much you are currently spending in order to know how much you will need to cut out.  Take a look at your cash receipts and credit card statement to approximate how much you are spending, you might be surprised at the figure.

Look at what goes where and identify which parts you need to minimize and what you totally don’t need. Knowing the areas you are overspending on will help you divert the money into saving.

Set a monthly budget

Any financial adviser will recommend you divide your income into the 50/30/20 rule, 50% of your salary goes to necessities, 30% fun money and 20% goes to saving. If you follow this rule, you will be in a better financial position.

It is also important to put your goals into consideration to see how much you can be able to save. If you are unable to meet your savings goals then you need to cut off on the spending or find a way to increase your source of income.

The necessities Account

When creating a necessity budget start by outlining the non-negotiable like rent, insurance, transport, utilities, mortgage etc. These are the things you cannot live without. After adding up this amount, subtract it from your income after tax to see if it is less than your income then you are in a better saving position.

The fun money Account

After taking care of the non-negotiable, then divide the remaining of the salary into 20% savings and the remaining 30% for all the fun you need in your life. You can use money to travel, shop, gifts and any other thing that you do not consider a need.

It’s not enough to set the money aside. When creating the fun money budget, add up what you have been currently using you might be surprised at how much you might need to cut back from this account. You might need to vacation some place, minimize shopping or maybe start a side gig.

While it is necessary to have a fun account, you might consider saving more if you have more fun goals that you would like to achieve in future.

The savings Account

Just because it comes last on the 50/30/20 rule, it doesn’t meant it is less important. It is actually recommended to put this money aside before the fun account budget. Figuring out how much you need to save will be determined by what kind of goals you want to achieve.

If you have not been saving at all this will need a lot of discipline.

So how do save money each month

After creating your budget, you will be in a better position to see the areas that have been taking a lot of your money and what you can cut off.

Some ways that you can save include;

• Renting out a cheaper apartment in a different but secure neighborhood. If relocating is hard, you can consider getting a roommate.
• Carry lunch instead of buying since this food will be part of the necessities budget. While on the food subject, cooking more instead of ordering take out is another great way to save.
• Friday night out with friends might be harming your budget more than you know. Consider cheaper activities like hosting a game night.
• Consider working out at home instead of paying monthly gym membership, it is now so much easier with the help of YouTube.
• Buy second hand clothes
• Freeze meals to avoid cooking every time and chances of ordering out.
• Refinancing your mortgage can get lower interest rate which will reduce your monthly payments.
• Have a shopping list when going shopping to avoid impulsive buying
• Switch your cell phone provider or internet provider. Look at cheaper options available in your area.
• Get a budgeting app, budgeting for first timers may be a bit hard but more so, seeing how much money you are spending on real time can help with the discipline.

Sometime it’s not enough to cut down on the spending, consider getting a side hustle to support some needs. Creating a budget is not complicated if you take time to think on your goals, how long it will take you to achieve them and what you need to do to get there. It will not be easy to overturn your spending habits, it needs time, patience, discipline and knowing how you want your life to pan out.

Congratulations on your loan approval! Now that you got the money, the next step is to manage it well to maximize its return and ensure that you will be able to pay it back smoothly. When most people apply for a logbook loan they already have an idea on how they will use the money. However, it is easy to get overwhelmed when it comes to the actual distribution and sticking to the repayment procedure.

When managed properly, a logbook loan is one of the best ways to relieve financial pressure. Whether for personal or business reason, logbook loans are the easiest way to cover down payment, handle a financial emergency or pay for a vacation etc.

Just because it’s quick and easy to get a logbook loan in Nairobi, it doesn’t mean it’s as easy to manage it. Here are a few tips for the next time you get your logbook loan approved.

1. Create a budget

If you have ever been afraid to look at your bank balance most likely you spent money on stuff you shouldn’t have or overspent on some. Doing the math in your head won’t cut it here, to avoid wrecking your good credit score, creating a budget is the first thing you do. Managing your logbook loan without a budget will leave you wondering where the money went since you cannot account for how much went where.

Creating a budget will help you track your spending, avoid confusion and maintain a good credit score. The first step when creating your budget is dividing your expenses into broad categories that are easier to track, for instance if you took a logbook loan for your SME, you can categorize into Pay Salary, Rent, and Purchase Raw Materials etc.

If you are new to budgeting there are plenty of sites with budget templates and guidance on how to create one like. There are also dozen desktop and mobile apps for financial management and bookkeeping.

2. Pay on time

After creating your budget you will realize how easy it is making payments on time. Making your payment on time is one of the ways to maintain a good credit score and avoid late fees and penalties. Having a good credit score can even reduce your interest rates.

If you have taken a logbook loan or are about to, a good way to ensure peace of mind is making an early payment. Paying ahead of your due date will give you a buffer against a late payment. Most loan providers have automated payment system to remind you earlier on about a due payment.

Do your best to pay on time always and watch your rates go down.

3. Pay a little extra each time if paying on installments

Be sure to check on your provider’s policies, if they allow paying more than the minimum required on each installment, it is a good way to manage your logbook loan. If you get extra cash flow, the first thought should be towards your debt, don’t make debt a thorn if you can settle it.

Paying more than required keeps you ahead of your loan terms as well as helping with credit score and low-interest rates. Paying more than the minimum will reduce the overall length of your payment plan

While this will save you money in the long run, it restores your financial independence even sooner.

4. Consolidate your loans

The good thing about Logbook loans is that you can take multiple against either personal vehicles or company cars. While this may come in handy when you need a certain amount of money, having many loans may be difficult to manage and pay back.

Consolidating your loans is a great way to simplify your debt repayment. Debt consolidation is when you take out a single, large loan that can be used to repay all of your other loans, instead of making payments to multiple lenders each month with different interest rates and requirements, you will be making a single payment to one provider.

With debt consolidation you might even get a new loan with lower interest rates than the average rates of the different loans. However, debt consolidation may mean repaying your debt faster than before so you need to make sure you will be able to make payments on the new loan.

5. Keep a close watch on your credit score

Credit scores can be sometime confusing especially now with so many different models and algorithms available. Your credit score is one of the most important number when it comes to lenders. We rarely give credit score the attention it deserve until you try applying for a loan and realize how much it’s ruined. Lenders use your Credit score to assess a borrower’s risk and their qualification for a loan.

Credit ratings also determines the kind of interest rates you will get on your loan. Bad credit score means higher interest rates compared to people with good credit score, that is, if you are approved to begin with.

How you manage your loan affects your credit rating, sticking to agreed installments and paying on time all contribute to an excellent credit score and lower rates on down payment. Higher ratings comes in handy when making big purchases like buying a house or a car. Avoid falling behind on your payments to marinating a good credit score.

Bottom line

If you were having a difficult time managing your logbook loan, you can now regain control of your financial situation. Managing a loan needs not be a hustle, especially logbook loans. Following the above steps and being disciplined with your finances will place you ahead of your financial situations and guarantee the success you seek.

Milhan Capital offers quick logbook loans in less than 12 hours to sort out any arising financial emergency while still retaining the use of vehicle. Applying for a logbook loan is as easy as following this link http://milhanaccesscapital.com/loan-products-kenya/ . You can also calculate how much you will repay at http://milhanaccesscapital.com/.