Columnists Features

Everyone has potential to save money

ELEMIYA phiri.

‘I CAN’T save money because I earn a meagre salary,” said James Bwalya. James is my long-time friend who works at one of the private manufacturing companies in Kitwe.  
I pondered over the above statement he whispered to me about as we strolled along Lusaka’s Cairo Road, one Saturday afternoon. I met him after a long time and to be precise, it has been six years since we last saw each other.
When I reached home, after James and I parted company I deeply reflected on his statement to ascertain whether his assertion was right or wrong. My conclusion was that it was wrong. I firmly rebutted his assertion that people who earn big chunks of money either from gainful employment or business should save. The gist of the matter is that everyone can save money regardless of how much a person has or earns as a salary.
It is possible for everyone to save provided that person is eager to do so. The first step is to open a bank account at any commercial bank. The basic requirement to open a bank account is for one to have a national registration card and a minimum amount as initial deposit for transaction to be completed.
Commercial banks offer different types of accounts like savings account, deposit account, current account to mention but a few. Apart from providing bank accounts, commercial banks also provide services such as loans, overdrafts and professional advice to the customers when they are in dire need.
Banks don’t dictate the type of account that the potential clients should open. They only provide the necessary advice to the people who wish to open a bank account. The latter will then make informed decisions.
In a nutshell, a bank is any financial institution which is charged with the responsibility of collection of surplus funds from individuals and corporate clients for safe custody and lends some which is not required for immediate use.
When you save money with a bank, you earn interest on your account. This is because the bank uses your money to lend to other clients. For the money to grow in your account, you must be consistent with your deposits over a period of time. This requires discipline on the part of the one who holds the account.
By discipline, I mean someone who has a clear purpose of saving money. I don’t subscribe to the idea of someone depositing money in a bank today and withdraws part of it a few days later for beer drinking for instance. This is a misplaced priority which should not be condoned. People save for various reasons but, they should withdraw it for good reasons other than leisure.
You can open an account with money as little as K50. If you save a fixed amount of K100, you will raise a good amount after a certain period of time. This is the importance of banking.
The bank is the only safe place where your money will be secured, devoid of theft. It is surprising that some people hoard money. Hoarding is a system of keeping money in homes by some people. This is not a good way of keeping money because it can be lost through theft or eventualities such as fire, caused by electrical faults.
No matter how long you hoard money in the house, it will still maintain the same value. In some cases, its value might even erode due to depreciation of the currency. It is, therefore, important to save money in the banks.
For people to appreciate the need to save money it is important to teach people about financial matters. People should be sensitised on the need to save. This will make it multiply and gives the returns in future. When the money increases due to saving, it can be used to buy assets like a house.
There is also need to inculcate financial literacy in children at school and home by their teachers and parents, respectively. This will help the little ones to fully understand and appreciate the importance of saving.
All things being equal, saving is important as it prepares someone’s future and every person has the potential to save. This is irrespective of whether one has a lot of money or not. It is never too late to start saving. Take a step today to start saving and enjoy the benefits of keeping money for a rainy day.
The author is an accountant and a business executive based in Lusaka.

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