- Not having a financial plan
Many of us go through life without a clear financial plan. We have a vague idea about what we want to do: paying for children’s education, traveling to a dream destination or retiring comfortably but have no timelines or concrete steps to achieve the goal. Without a plan, it’s easy to overspend, procrastinate on saving, accumulate debt, and feel overwhelmed about the future. Daydreaming is not a strategy: it won’t get you to your goals.
What to do instead
- Set clear, actionable goals: What are your money goals for short-term, intermediate, and long-term goals? Write them down and include timelines. Writing down your goals makes you more likely to follow through on them and turns them from abstract dreams into actionable plans. For instance: “I want to save 500,000 shillings in three months for an emergency fund” is more actionable than “my new year resolution is to save more”.
- Regularly review and adjust your plan. Check in at least once a month to track your progress, update goals, and adjust the plan if you have to.
- Living above your means
Many people spend more than they earn, often relying on loans to fund lifestyles they can’t truly afford. This habit makes saving for financial goals nearly impossible and keeps people trapped in debt. Without tracking spending, identifying non-essential expenses, and making adjustments, it’s hard to stick to a budget or build long-term good financial habits.
What to do instead
- Track and understand your spending. Categorize expenses into essentials and non-essentials.
- Cut costs strategically. Look at your recurring bills, food, entertainment, household costs, and high-interest loans. What are some areas you might consider cutting back on? Is it eating out? Going out for drinks? Subscriptions for services that you don’t really need? Can you buy in bulk (if it makes sense)? I for instance have a small household of people who do not eat much so buying fresh foods in bulk is a no for me. Review your own situation and take action accordingly.
- Avoid relying on debt for lifestyle expenses. Easier said than done, I know. According to Bank of Uganda’s Finscope survey seven out of 10 Ugandans spend more than they earn. But it’s not impossible. By being intentional about controlling spending and prioritizing saving, you can create space to fund your goals and not have to rely on debt.
- Not having an emergency fund
Life is unpredictable, and unexpected expenses such as job loss, illness, or urgent car repairs can hit anyone. An emergency fund is money set aside to cover unexpected expenses. Without one these events can derail your finances, force you into debt, or undo years of savings. An emergency fund is your buffer against these setbacks.
What to do instead
- Set up an emergency fund. Most financial experts recommend saving three to six months’ worth of household expenses. Figure out how much it costs you to live each month and how many months you want to have saved in your emergency fund.
- Break it down. Figure out how much you can contribute each month. Then you’ll know how long it will take to build up that amount. Start small and be consistent; even 50,000 shillings per month adds up over time.
- Money market funds (unit trusts) are good places to park your emergency fund. They are liquid enough that your money is accessible in times of need but harder for you to dip into than a bank account with an ATM card. You’ll also earn interest on your money.
- Waiting too late to save and invest
Many Ugandans delay saving because we feel our income is too small, or we think “I’ll start when I earn more.” But every day you wait makes it harder to reach your financial goals.
What to do instead
- Start small. You don’t need millions to begin. Even saving 10,000 shillings a week in a money market fund (unit trust) is a good start. What matters is consistency. As your income grows, increase what you save.
- Have a plan for your future needs. Retirement might seem far off, but it’s closer than you think. Ugandans are living longer. And women live even longer. Yet most rely only on NSSF or their children in old age. That’s risky; your child is NOT a pension plan! Sit down and estimate how much you’ll need monthly when you stop working or can’t work as much. Then plan backwards from there.
- Doubting your abilities because you are a woman
As women we have grown up hearing that we are bad with money, that men are better placed to make major financial decisions on our behalf. Many of us underestimate our own abilities and financial potential. Whether it’s negotiating a salary, starting a business, investing, or pursuing a promotion, self-doubt can hold us back from opportunities and financial growth.
What to do instead
- Pay attention to the moments when you hesitate or undervalue your skills. Ask yourself: Am I doubting myself because of facts, or because of fear, stereotypes, or past setbacks?
- Invest in your knowledge and skills. Financial literacy, career development, and continuous learning give you the tools to act with confidence. Knowledge reduces uncertainty, helping you make informed decisions instead of second-guessing yourself.
- Take small, deliberate actions. Build confidence by starting with achievable goals: open an investment account and build your investment experience.
- Seek support and mentorship. Surround yourself with women and allies who encourage growth and celebrate achievements and provide reassurance when you face challenges.
By Martha Songa
miss.songa@gmail.com