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How do I raise Sh300,000 to pay my wife's dowry?

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To meet your financial goals, aim at increasing your savings to at least Sh10,000 per month.

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My name is Titus. I earn about Sh55,000 net. I live on the outskirts of Nairobi. I have a wife with one child who is four years old.

My expenses currently are as follows: Sh12,000 rent, Sh20,000 for house expenses including food, shopping, WiFi and entertainment subscriptions, Sh7,000 for my transportation, Sh5,000 for wife’s home allowance, Sh2,000 for my mum in the village, Sh1,000 for my dad, Sh6,000 for baby’s nursery school.

My goal is to pay dowry for my wife before December 2025 then build a house in the village on my parents’ land in 2026. I plan to pay dowry worth about Sh300,000. Kindly give a workable plan on how to achieve this.

Alex Kibebe - the founder of Rubiani Wealth Management Ltd and an investment consultant and business development coach

From the information you have provided, you have a net income of Sh55,000 and monthly expenses of Sh53,000 leaving you with savings of Sh2,000 per month.

To meet your goals within your preferred timelines, you should aim at increasing your savings to at least Sh10,000 per month. Here are some suggestions to help you achieve this.

First, work at reducing your home expenses by Sh4,000. You can achieve this by cutting down on entertainment subscriptions and finding ways to save on food and household shopping.

You can also increase your savings by reducing your transport costs where possible. You can do this by using public means, traveling during off-peak hours and avoiding unnecessary travel.

If your wife is not currently earning an income, think about starting a business for her or exploring job opportunities especially now that your child is in school.

Any income she earns can help reduce or eliminate your monthly allowance to her and also potentially support part of your home expenses, thereby increasing your savings.

If she starts earning, you can free the Sh5,000 allowance and redirect it towards financially stabilising your household.

Consult an investment planner

Another area you can consider for saving is reducing your mum’s allowance to Sh1,000 to match what you give to your dad.

Once you have achieved your goal of saving Sh10,000 or thereabouts, I recommend investing the money in either a Money Market Fund (MMF) or a Bond Fund.

These accounts offer an interest of about 15 per cent per year at the prevailing rates and your fund will be available to you when you need it. Review available fund managers and choose an ideal MMF or Bond Fund provider to invest with.

You can consult an investment planner who is conversant with treasury bonds to get a balanced portfolio with frequent coupon payments. Remember that money market funds and certain bonds and bills attract withholding tax.

Factor the tax in your investments and the rate of inflation which is currently at around five per cent to determine which MMF is fundamentally viable for you. With a treasury bonds expert, you might want to explore infrastructure bonds which currently attract zero taxation.

To ensure discipline and consistency in savings, I would advise you to transfer your savings to the investment account as soon as you receive your salary to avoid spending on other things and falling short of your savings target.

If you save Sh10,000 monthly for 18 months until December 2025, you should accumulate around Sh200,000 in your investment account.

Your financial reality

You can consider raising the rest of the money needed for the dowry ceremony from family and friends.

After fulfilling your dowry goal, continue investing in the MMF or Bond Fund account until you have enough funds to build a home in the village.

However, avoid spending too much money on building a home in the village especially if you do not plan to relocate there soon. You may even consider postponing your plans for building this home for now and instead focus on more urgent and important goals for your family.

This could also be said of your intention to raise over a quarter a million for dowry with your current financial status.

Without watering down this resolution, you may want to sit down and confront your financial reality. Is it an emergency? Can it be postponed by another year to give you space to align your finances and establish a stable emergency fund?

These goals may include building an emergency fund to cover urgent money needs thus keeping you from falling into debt, saving for your child’s education and raising capital for a family business.

I would also advise you to consider taking on a life insurance cover to protect your family in case anything were to happen to you. Term Life Insurance is a more affordable option and with a premium of about Sh1,000, you can secure a substantive cover for your family.

By following the above recommendations, you should achieve your goals within your preferred timelines and secure a solid financial future for you and your family.

If you have any money problems, send us an email at [email protected] and leave your number for contact. Money questions will be answered on this column.