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Prioritizing Your Financial Priorities

“The key is not to prioritize what is on your schedule, but to schedule your priorities.” Stephen R. Covey, American author of ‘The Seven Habits of Highly Effective People’

Very few people in the world have enough money to achieve all their financial goals simultaneously. Most individuals juggle with money as they work toward several different financial goals. All financial goals are obviously important, but some goals are more important than others.

Whether you know it or not, you could be prioritizing your financial needs often. For instance, you may have decided that settling this month’s electricity bill is more important than buying a new piece of furniture. But sometimes it seems like, try as you might, you never have enough money at the end of the month to do what you want.

Setting priorities is fairly simple, you just need to decide what issues you need to take care of and then put the most important ones on top of the list. The five most basic priorities that you must deal with are taking care of your necessities, repaying your debts, building an emergency fund, saving for your goals, and meeting other financial obligations.

  1. Necessities Come First

First of all, there are basic principles that pertain to everyone and which are a matter of survival. These are food, shelter and transport. Therefore, to begin with, you need to do what it takes to ensure that your basic needs are met. This means that you have to pay for:

  • Housing (rent or mortgage)
  • Utility bills
  • Groceries
  • Transport (Fare or Fuel)

You should not spend another shilling before making these payments. If you put them off, you will start experiencing money problems much sooner than you would if you had delayed paying off other expenses instead.

  1. Debt Repayments

Making at least the minimum repayments on your loans should be high on your list of priorities, to avoid the fees and penalties that could occur. If you can afford to pay more than the minimum, well and good. This is because high-interest rates could still make your balance much higher.

Ideally, you should use any extra income to pay down your high-interest debts aggressively. After eliminating your debts, you will now have some extra money to put towards other financial goals.

The idea here is to pay off your loans as fast as you can, and possibly avoid getting into debt again. That way, you will free up money which you can then save, invest, or spend.

  1. Emergency Fund

No matter how hard you try to plan, the unexpected always happens. That is why you need to be prepared by having an emergency fund. Not only will it help you in dealing with unanticipated expenses, but it will also prevent you from getting into debt in the future.

Hence after settling your expenses, you should strive to save enough money to sustain you for six months. This will give you peace of mind knowing that you have something to get by should you find yourself short of cash.

[Read More: Planning For a Financial Emergency]

  1. Save For Retirement

Many people ignore this but you shouldn’t. As long as you are working, you should be saving for retirement.

Traditionally, retirement products required fixed monthly contributions. That puts off many budding entrepreneurs and young people working in the gig economy. That’s not the case anymore as innovative products such as the Zimele Personal Pension Plans now allow anyone to save a minimum of Ksh.100, at their own pace. This flexibility allows youths and entrepreneurs to start saving towards retirement and even those with a retirement plan at work to supplement their retirement savings.

Retirement savings in a registered fund are tax-exempt so you can even lower your tax burden.

[Read More: Why Save For Pension? To Reduce Your Tax Burden]

  1. Save For Your Other Goals

Everybody has a goal. Big or small. Whether it’s going on a vacation, upgrading your TV, or starting or expanding a biashara, you need to save for these goals.

Save for your goals through the Zimele Savings Plan, where you will earn attractive returns with convenience and flexibility.

  1. Other obligations

Finally, consider key expenses such as school fees, medical or insurance, among others.

Though this is the last item, these should be considered as important as your necessities, since failing to provide for them may result in you having to obtain a loan to make it to the end of the month.

You should, however, consider ways of cutting down these outflows so that you do not just get by after settling these payments.


We need to have money to live comfortably in today’s demanding society. Competing needs call for prioritization of limited finances. The key lies in determining what your financial priorities are, and sticking to them. And of course, you must be willing to rethink them when circumstances dictate.