Top 5 Investment Opportunities In Kenya For Young People That Do Not Require More than 30% Of Your Time

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Investing is crucial at any stage you are in life. In fact, the earlier you start, the better. Often, young people are not too concerned about how their future finances would look like. On the other hand, there is limited education on investment. So, it is not a wonder to see young people viewing investments as something that is understood better by our elite wazees

Before we dive into the nitty-gritty of the investment opportunities available in Kenya for our youths, let’s first take notes of why it is important to start investing in your early days.

  • Increasing the value of your money

Saving is great, but if your money is not adding value, then you are probably wasting opportunities. Investing creates new income sources generated from interests and profits from your investment funds and overall increases the value of your savings. 

  • Let money work for you

As we have pointed out, holding or saving your money will not increase in value. As you focus on other things such as continuing your education or building your career, investing helps you to build your side projects, literally letting your money work for you. 

  • Working towards your financial goals

Investing, in this case, means putting in place a financial plan to help you realize your financial goal. This could be things like buying a house in the future, starting a business, or even funding your children’s tuition. When your money generates interest, it means that you make extra money both in the short and long- term. The returns from such investments can really help you to realize your financial goals. 

  • Building investing habits

You don’t want to be 50 years old someday and have nothing to your name outside your job title, and even worse without the option of pursuing something you actually love to do. Now is the right time to review your expenses and explore contributions that can help you generate more revenue. 

  • Preparing for retirement

While most young people may not have the thought of retirement as much as the older folks, preparing your pension fund earlier on means that you can have better savings in the future. Remember, the value of your money will continue to grow over time. 

So, which investment options are available for the youths?

  1. Capital Markets

Yes, capital markets are not exclusively for the elite and corporates. The Capital market is a market where buyers and sellers engage in the trade of financial securities like bonds and stocks, currencies, and other financial assets. 

For example, bonds are simply ways in which the government and corporates borrow money from the public. As such people like you and me have opportunities to save and invest in our future. The capital market authority is the regulator of the activities and individuals in the capital market. 

To take part in the capital markets, it is important to do your research to find out which players are likely to be a good bet for you to put your money. The Capital Market Authority lists all the players in the market ranging from fund managers, stockbrokers, investment advisers among others on their website. 

  1. Mutual funds

According to Investopedia, a mutual fund is an investment vehicle made up of a pool of money collected from many investors for the purpose of investing in securities such as stocks, bonds, money market instruments, and other assets. There are different types of mutual funds such as;

  • Money market fund
  • Income fund
  • Balance fund, and
  • Equity fund

Corporate institutions like UAP & Old Mutual and Standard Chartered bank offer support to clients to transact in the mutual fund markets. Unlike capital markets which are usually long term in nature, mutual funds are short term, often giving back interest within 12 months. 

  1. Bank deposits

When it comes to bank deposits, fixed deposits offer guaranteed fixed interest rates paid on maturity of the contract. KCB is one example of banks offering competitive rates in Kenya of up to 6% per annum. Bank deposits come with very low default risks and thus offer the security of your capital. In addition, the returns are also fixed throughout the tenure of the deposit. Lastly, fixed deposits provide ample liquidity as you can prematurely withdraw at any time. Besides, you can invest in deposits for as little as a month too, thus providing a lot of flexibility. 

  1. Foreign and cryptocurrency

For many, cryptocurrencies sound a mystery, and I am well aware this is not something we are going to solve with this article alone. Again, it is important to do your research before diving into investments. The truth is, Bitcoins and cryptocurrencies emerged in 2007, and 13 years later, we can agree that they are no longer a passing fad. In Kenya, it is 100% legal to buy, trade, exchange, hold and store cryptocurrencies. 

Besides cryptocurrencies, forex exchange is another great way to earn interest on your revenue. To place an order in Forex, one has to sell a currency and buy another. Sites like Olymp trade provide training and guidelines on how to trade in forex. At the core, forex trading involves making a prediction on how the currency you are buying or selling will change. This means that you have to understand the exchange rates and observe trends to guide you on when is the best time to buy or sell currency. 

  1. Start with yourself

When you think about investment, it is important to start with yourself. Have you been thinking about starting a business? Do it in your youth. Not only will you be growing your skills, but you will also be growing your income. 

Also, education is  another cool way of investing in yourself. Pursuing that second degree or higher diploma is definitely a good future plan. And as you do, keep your health, physical and mental state always in check. 

Feeling inspired?  Share this article with your friends and leave a comment below. 

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