Let’s face it, life can be unpredictable, and you never know when you might need some extra cash. Maybe your car breaks down, or you have a medical emergency.
If you don’t have any savings, you could be in big trouble. But if you have a little bit of money set aside, you can breathe a little easier knowing that you can handle whatever comes your way.
Ah, saving money. It’s one of those things that seems like a good idea in theory, but in practice, it’s just not as fun as spending it all on fancy clothes, cool gadgets, and a never-ending supply of your favorite dish on Vuba Vuba.
Statistics show in the percentage of people that save only 13% are young people. The Rwanda Social Security Service (RSSB), shows that young people do not participate in long-term savings in the Ejo Heza program, compared to the situation in other categories of the population.
But why is this? It can be due to low income. Most young people do not earn as much as other generations which may limit them from achieving their savings goals. However, one of the young people who are part of the Ejo Heza program shared with us that the main reason is a lack of information and low awareness thus low financial literacy.
Tumukunde Vivine, who studies at the University of Rwanda, Department of Accounting, says that the problem is not money, but lack of access to information is what makes the number of young people who save still low.
“Savings don’t cost a lot of money. You can save small amounts which will generate interest over a period of time. You know, the money we receive [scholarship] is sometimes seen as insufficient, but you can save a little today just to plan for tomorrow.”
Tumukunde believes that having money or receiving money is one thing but having the knowledge to actually use the money properly is a whole concept entirely. She firmly asserts that a person who does not have the knowledge to use it properly their finances always a loss.
Niyomubyeyi Vanessa, a graduate in Economics from Ines Ruhengeri, says that the best thing is that a person who earns money should first do is to save and then plan on how to use the rest of the money afterward.
She said, There should be many formal financial services given to young people. But they should also be encouraged to seek those services. If they [youth] have ideas they should be given all the help they need but they should also be taught how to properly use the money.”
Furaha Dorothé, who studies at the University of Rwanda, says that saving is possible even if you have little money.
She said, “I didn’t understand it either because I thought it was for adults and they had money. Now you can save 5000 Frw or less and that could be enough.”
Kwizera Isaac says that the reason why young people don’t participate in planning for the future is that they want immediate money, they do not necessarily think about their future.
He said, “Some people want to invest in things that will immediately bear fruit. If there is anything of the contrary they do not want to hear it. They want to invest it and gain profit overnight. They need to understand the benefits of planning and securing your future.”
Rwabukumba Pierre Celestin, the current Chairman of the East African Securities Exchanges Association (EASEA) in Rwanda, said that saving is a habit, it is not about having a lot of money.
He said, “Countries have developed because of that culture. We must imitate that culture and train the youth, that will benefit the progress of the country.”
Simply put the reason why young people in Rwanda don’t save is that they simply don’t know how. Financial literacy is not something that’s widely taught in schools, and many parents don’t feel equipped to teach their children about money management.
So, without proper education and guidance, it’s no wonder that many young people are clueless when it comes to saving and investing.
But here’s the thing – saving money doesn’t have to be boring or difficult. In fact, it can be downright hilarious if you approach it with the right mindset.
In order to increase the number of young people who save themselves, various programs have been established, including teaching in schools the benefits and reasons for saving, as well as other programs in which the government cooperates with the private sector to train young people on how to save.
But it is still up to the young minds to take the first step and save the first coin.
