VOL 5, ISSUE 11 NOVEMBER 2010
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Akamai Global’s New Book: Make Sense of Your Money ON OTHER PAGES
wo of the regular
contributors to Akamai
News, James Abola and Page 2
Phillip Karugaba have written a Question & Answer
great book titled “Make Sense Answers to money questions.
of Your Money.” The book was Page 3
published by Akamai Global and Women & Money
released in November 2010.
What women should know
Make Sense of Your Money about money. Page 4
condenses the information that Book Reviews
made Akamai Global, Uganda’s Network Marketing and
number one investment Microfinance Page 6.
education firm in 2009 in ten
chapters. The book is full of
New Financial Literacy Book;
practical and easy to understand
Business & Motivation CDs/
principles. In the words of
DVDs; Money Training for
Patrick Bitature who wrote the Teenagers Page 7
foreword, “If you are to embrace
the suggestions given in this
Raising capital and developing
book, I am certain you will lead a These concerns include learning
a business plan Page 8
comfortable life free of financial how to set and achieve goals,
turmoil.” preparing for retirement,
managing personal debt and
The main character Moses
finding other ways of earning
Otto undergoes a financial
transformation from a moderately
money apart from a salary. WEB LINKS
successful man holding a steady The search for financial wellness
job and starting a family business led Otto to a financial coaching
into a man staring in the face of group. It was in the financial You can now read our newsletter
financial disaster. Like many coaching group that Otto learnt at http://akamai.pamogi.com/
people, Otto battles to make that financial success is not a
Find information about Akamai’s
ends meet and finds that there is matter of luck but can be learned. Money Book at
usually “More month at the end Otto and his new found colleagues http://makesenseofyourmoney.
of the money.” spent the next weeks learning blogspot.com
about topics such as thinking
In addition to Otto, the book
like a wealthy person, managing
contains other characters with
different financial concerns.
savings, relating Page 2>>
NOTE: THE CONTENTS OF THIS NEWSLETTER ARE INTENDED FOR GENERAL USE ONLY AND SHOULD NOT BE RELIED UPON
WITHOUT SEEKING SPECIFIC ADVICE. AKAMAI GLOBAL ACCEPTS NO LIABILITY FOR ANY SUCH RELIANCE AND EXPECTS
READERS TO SEEK FURTHER ADVICE FROM BUSINESS, FINANCE AND OTHER EXPERTS BEFORE TAKING A DECISION TO INVEST.
g Business & Financial Advisors
>> Page 1 Make Sense of Your Money
money with a person’s life purpose, managing come.”
personal debt, financial systems, investments and
making a will. Mr Paul Busharizi, the seasoned Business Editor
for The New Vision observed that “When the history
People who have read advanced copies of Make of personal finance in this country is written, this
Sense of Your Money had these to say about the book will have pride of place.”
Akamai Global is discussing with leading bookstores
Mrs Grace Tibihikira Makoko the head of Financial and booksellers such as Aristoc Booklex to ensure
Markets at Standard Chartered Bank Uganda that the book is available all over Uganda by early
said, “This book is a must read for everyone who December 2010.
has decided to stop worrying about the future and
instead plan for it, by changing what they chose to According to James Abola the Team Leader for
do today.” Akamai Global and co-author of the book, “We
want to make this book accessible and affordable
Mrs Emma Mugisha who is the Treasurer, Barclays for every Ugandan. We are sure that the book will
Bank Uganda commented, “The authors’ insight be printed before the end of November and have
will definitely get you thinking of what you doing decided to make the cover price low so that many
right or wrong with regards to your money.” more people can read it and purchase copies for
their friends as the early Christmas present that
According to Mr Dennis Kawuma the Business keeps on giving.”AN
Editor for Daily Monitor Newspaper, it is “A timely
book, which will remain relevant many years to
Editor’s Note— Making sense of money
One day he is contentedly climbing up the greasy pole of financial success; the salary is good enough
and increasing, the family is happy. Then he decides to move things a notch higher by borrowing some
and investing in a lucrative venture and that is when the problems come pouring. A sick child, followed
by a period of hospitalisation and theft by an employee of the new business turned the once rosy
financial situation into a dire one. Did he survive or did he sink?
Find the answer in the forthcoming book by James Abola and Phillip Karugaba titled, ‘Make Sense
of Your Money’. The authors have been labouring for 20 months and produced a piece which is very
readable, highly informative and relevant to the African setting. We expect the book to be in bookstores
by November 25, 2010. In the meantime you are welcome to review highlights and excerpts of the book
I am happy to welcome a new contributor to this publication; Irene Besigiroha. Am sure the ladies will
be thrilled by her debut piece, “Woman to Women About Money.” And guys who have been wondering
how women handle money will find the piece useful too.
If you want to know a bit more about network marketing and lending money
to the poor then our book review page is a must read. Our reviewer has
covered two books, one by Robert Kiyosaki and the other by Professor
I wish you a good read as you sit back and enjoy the rest of the newsletter.
When the time comes, have a merry Christmas and a prosperous New
g Business & Financial Advisors
BOOK EXCERPT: Make Sense of Your Money
EARNING FROM EMPLOYMENT AND SELF EMPLOYMENT
To make money from employment or self- employment 300,000 will be lucky to retire 30 years later on a
one needs to be qualified, knowledgeable, skilled salary of Shs 3,000,000. Employment increasingly
and experienced. The earliest time a graduate can resembles a bottleneck that requires multiple
become employed is after the age of 23 years and qualifications and skills in order to pass through.
even then it will be a junior position with a small One idiosyncrasy of the employment market is the
salary. The high-paying jobs usually come after fact that young graduates are turned away because
about three years’ work experience and added they lack experience and job seekers older than
qualification. 35 years are told they are too old to get a new
Soon after political independence, all it required to position!
get a permanent and pensionable job was to get The other challenge faced by the employed is
a degree, diploma or certificate. Now the situation the high level of taxation. For a person earning a
has changed; several graduates walk the streets for gross pay of Shs 3,000,000, Shs 823,500 will be
many years without finding a job; and those who are deducted for Pay-As-You-Earn (PAYE); Shs 150,000
lucky to find one will most probably be employed on will be deducted for social security; Shs 8,333 will
contract. go towards local service tax and the employee is left
Another person pointed out that a person who starts with a take home of Shs 2,018,167only.
working at the age of 25 years on a salary of Shs
hout Make Sense of Your Money (MSYM)Q&A
n November 10, 2010, James Abola the Question: I do not feel cut out for business,
co-author of Make Sense of Your Money what else can I do to earn money?
travelled down to Mbale in Eastern Uganda MSYM: There are four ways of earning money,
to give a pre book launch talk. The topic of James’ namely: employment which gives you a salary or
talk was “The wealth mindset.” The audience was wage; self employment which gives you fees and
composed of people in their 20s and 30s who commission; business which gives you profits and
engaged in a question and answer session. investments which give you passive income. If you
Question: How can I cut down my expenses? feel that business is not your thing then perhaps
MSYM: Here are tips that other people have you can develop your abilities as an employee, a
previously used to cut down their expenses. Know self employed or an investor. See more tips in the
how much you spend during your earning cycle i.e. chapter, ‘Investment Principles’ in the book Make
monthly; you will do this by recording your expenses Sense of Your Money.
on a daily basis for at least one month. Prioritise Question: What is your comment about
your expenses starting with obligations (what you borrowing money to finance investments?
must spend on such as taxes and social security); MSYM: Ideally the only reason a person ought to
followed by needs (things that are essential for your borrow is when they intend to invest the money
life). After needs you can consider wants which in in a venture that will yield a return that covers the
essence are more expensive needs for example interest and principal of the loan. When borrowing
buying raw food and preparing it could be a need you should be mindful that a loan is paid by cash –
while eating out in an expensive restaurant is a will you therefore have the cash to pay interest and
want. Finally spend a bit but not too much of your principal instalments as they fall due? Also refrain
money on desires i.e. the kind of expense which from borrowing for speculation because when you
gives you the feeling “this is my money; I worked flop you will still have to repay the loan. See more
hard for it, and feel good enjoying it.” See more tips tips in the chapter, ‘Debt, the Double Edged Sword
in the chapter, ‘Managing Expenses and Saving’ of ‘in the book Make Sense of Your Money.
the book Make Sense of Your Money.
g Business & Financial Advisors
WOMAN TO WOMEN ABOUT MONEY: By Irene Besigiroha
have always been a dreamer. I am able to lose choice, either we postpone pleasure and do the
myself for minutes on end in a fantastic world hard work we need to do to achieve financial
I create in my mind. freedom now or we live in the moment, spend our
Over the years, I have found daydreaming has money as fast as we make it and cross our fingers
its uses... like getting boring two-hour biology in the hope that all will be well in the future.
lessons to pass faster. There is just one problem: Budget
when we dreamers eventually wake up from our If you are anything like me, when you write
reveries, it is to find that we have failed Biology. your monthly budget, the figure at the end is a
While we dreamers entertain ourselves with how substantial number of shillings more than the
our lives could be, practical people are out there figure on your pay slip. Start trimming it right away,
actually building the lives they want. because there is no getting around the cold fact
For the longest time, I dreamt of the day my salary that you can only spend what you earn. In fact,
would be ‘enough’ and I would say goodbye to you must spend less than you earn, because you
end-of-month credit crunches. And every year, need to save.
nothing changed in my circumstances, except of Save, save, save
course I upgraded the decor in my mental dream
house, because, well, one simply has to move Back when I was at university, I had a friend who
with the times. religiously noted down her every expenditure and
handled her pocket money like she was managing
Every year ended with me disappointed and no the national budget. I thought that was simply
nearer my financial dreams and every new one too much work for a young lady with her whole
started with fresh good intentions: for sure this life ahead of her, but now I know better; every
was the year I would be financially responsible, shilling you save adds up. Does the thought of
this was the year I would make a budget and stick being fired from that job you might even hate,
to it. But you know what they say about the road give you chills? Ask yourself why that is. Financial
to hell; it is paved with good intentions. advisors recommend that you put away 20-30%
So one fine day, I gave myself a stern talking- of your monthly salary and that at any point you
to and decided to exchange my good intentions should have three month’s worth of salary saved
and dreams for discipline and goals because up for a rainy day. Do not simply live in the now,
while dreams are nice, nice feelings alone do not because contrary to the popular saying, tomorrow
generally get you to where you want to go. Goals, does come.
on the other hand, do. What’s in your trolley?
Eyes on the prize It is fair to generalise that the average woman
I have found that when I write down what I plan loves to shop. There is just something about
to achieve and set a time frame for it, I am less shop shelves filled with all manner of goods that
inclined to procrastinate. Targets keep us on track kills a few of a woman’s brain cells and sets off
and force us to plan. Where a dreamer might an adrenaline rush that can only be quenched
say: “Some day, I hope to have enough money by a purchase. I have been known to walk into
to buy a wardrobe for my room,” the planner will a supermarket with the noble intention of buying
say: “In 12 month’s time, I will buy a wardrobe only one or two items and ended up needing a
at sh600,000. To this end, I will save sh50,000 a trolley. This is why I introduced a revolutionary
month.” Twelve months down the road, chances tool into my life: a shopping list. And then I added
are, the planner will have moved on to another an even more revolutionary idea: sticking to the
goal (a dressing table perhaps) list. Works like magic.
Time to work Borrowing
To achieve one’s goals requires discipline. From time to time we all need a helping hand and
Discipline is not fun. Deal with it. American author there is no shame in that. However, if you take
Booker T Washington put it this way: “Nothing a soft loan, be a woman of your word and pay
ever comes to one that is worth having, except it back when you say you will.
as a result of hard work.” Ultimately we have a If you can’t, communicate with Page 5>>
g Business & Financial Advisors
>> Page 4 WOMAN TO WOMEN ABOUT MONEY
your creditor, don’t hide. In addition, don’t make with insecurities, imagining that the size of our
it a habit to borrow money; habits are very hard nose, the number of blemishes on our skin or the
things to break. If you find yourself constantly in imperfection of our teeth, will make us rejects.
the red, something needs to change in your life; And so we seek our worth in the clothes we wear,
find out what that is. the bags we carry, the places we hang out in and
Give some back the contents of our refrigerator. The reality is, no
matter how gorgeous we look and how nice we
Tithe. Give to someone in need. What? Now I am smell, at the end of the day, after we are stripped
encouraging you to spend? If you are reading this, clean of our pricey make-up, the person we see
chances are you have a head start on millions staring back at us in the mirror is the same lonely,
of other people in this nation: for starters, you self-loathing woman she was in the morning. And
can read! There are plenty of opportunities for now, she is broke as well.
you to give someone else a hand up the ladder;
Sometimes all it will cost you is forgoing several There is nothing wrong with fine dining and
sodas, beers or high heels a month; and the expensive clothing, if you can afford it, but if you
satisfaction in it will be more than any number are acquiring things way out of your financial
of drinks could have given you. Consider it an reach in an attempt to fit in or maintain a certain
investment. image, something is horribly wrong. Your real
friends don’t judge you by the depth of your wallet
Pick and choose or the gleam of your car. They know where you
That having been said, don’t give to every Sarah, came from and where you are going. They love
Jane and Joyce. Don’t contribute to every cause. you, not the trappings of your life. So, fall in love
Don’t fall for every sob story. As women, our with yourself and don’t be afraid to live the life
maternal instincts often kick in before we have the you can afford.
time to think. I have often contributed to wedding You may have figured out by now, I am no
meetings for ‘friends’ who I never heard from money expert. Mine are merely the musings of
again once the last crumb of wedding cake was a recovering dreamer, trying to figure out how to
eaten. Don’t throw away good money. Think. make ends meet. I fall down, I get up. Care to
Love yourself join me?
I have yet to meet a woman who is completely So as you can see, determining whether a
comfortable in her skin. We are often plagued mortgage is good or bad dependsAN
Time is more valuable than money. You can get more money, but you cannot get more time. ~Jim
Money will buy you a fine dog, but only love can make it wag its tail. ~ Richard Friedman
Many people take no care of their money till they come nearly to the end of it, and others do just the
same with their time. ~ Johann Wolfgang von Goethe
Money never starts an idea. It is always the idea that starts the money. ~ Owen Laughlin
Quotes from Make Sense of Your Money
Financial intelligence is about how you make, keep and make money work hard for you.
The point of owning a business or investing is to make your money work for you.
When it comes to handling money, it is those who combine good planning with implementing the plans
that will become successful.
g Business & Financial Advisors
BOOK REVIEWS: By Phillip Karugaba
THE BUSINESS OF THE 21ST CENTURY BY ROBERT KIYOSAKI
He is at it again, the old master The concept of network marketing It didn’t add up for me why I should
extolling the virtues of doing your is that the manufacturer sells the have them and worse how I could
own business to get out of the rat goods by word of mouth of his persuade someone else to buy.
race. customers and he cuts out all the Kiyosaki however makes
And what business do you think advertising costs, wholesalers compelling arguments in favour
he is talking about! You guessed and other middle men opting of network marketing and having
wrong! Not real estate, that is his instead to pay those savings heeded is other advice with
preferred final destination! The to the customers turned sales favourable results, I will examine
business so extolled in this book, agents. It also applies to services golden products, forever products
in fact the whole purpose of it and like holiday resorts. and that biodisk all over again!
his second book on the subject, I had always been a skeptic of This could be the business you
is network marketing or multi- network marketing ever since have been waiting for.
level marketing. someone tried to sell me a gold
watch and collectable gold coins! Email: firstname.lastname@example.org
BANKER TO THE POOR BY MUHAMMAD YUNUS
(Public Affairs, New York 177 Pages , Ug. Shs. 63,000/=)
In my quest to understand micro- Grameen Bank borrowers abide To end world poverty, Yunus
finance I was directed to this book by a code called the Sixteen prescribes social business of
and what an exciting read! Decisions. These decisions two kinds; a) business owned
AHarvard graduate teaching noble developed by the borrowers by investors but whose primary
economic theories in Bangladesh themselves require them to objective is a social good such as
shocked by the thousands of his keep their families small, grow poverty reduction or healthcare
fellow citizens waiting helplessly vegetables and eat plenty of them, and not maximising profit. The
a hungry death, realises the dig pit latrines, oppose injustice return to the investors being
disconnect between academia and even do physical exercises limited to recovery of their
and real life and resolves to bring etc. The economic empowerment investment only. b) a business
his training to help the poor. has also emboldened the owned by the poor and whose
borrowers into greater political profit would then go to benefit the
US$ 27 from his own pocket lent activity as block voters and also poor.
to 42 people started a micro- in contesting successfully for
finance revolution that has swept positions. As for the emancipation Grameen Bank is one form of the
the world, liberating credit from of the women, who form 98% of latter category being 90% owned
collateral and treating access to the borrowers, the results are well by the poor and with a majority
credit as a fundamental human beyond anything that feminists board of directors being illiterate
right Today over 250 institutions can talk about. (sshhhh! Don’t tell the Bank of
in over 100 countries (including Uganda!!)
the United States of America One amazing fact about the And for all its unconventional
and Norway) have micro-finance Grameen Bank practice is approaches, Grameen Bank has
programmes that follow the never to write off a loan in the made a profit every year save
Grameen Bank model started by face of the multitude of natural 1983 when the Bank started
Yunus. This must be the most disasters that strike Bangladesh and in 1992 and 1993 when
successful export from a third with such frequency. Instead the Bangladesh was hit by cyclones.
world country! Bank advances a fresh loan and
reschedules the old one. write offs This book makes wonderful
It is amazing what a little money Yunus believes would destroy the reading and for anyone the least
can do! As Yunus demonstrates, spirit of self-reliance, pride and bit interested in ending poverty, it
the economic empowerment of confidence of the borrowers! Woe should be compulsory reading.
the poor is the catalyst to fighting Uganda! How did we respond to Email: email@example.com
all other societal problems. The the Owino parkyard fire?
g Changing lives
Akamai Global Business & Financial Advisors
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g Business & Financial Advisors
USING THE INTERNET TO RAISE BUSINESS CAPITAL: By James Abola
I have been asked countless time by clients and an online lender that provides small loans to
readers about raising capital for a new business. borrowers through a network of field partners.
This article will highlight some of the ways of The borrower applies through the field partner,
raising capital that has worked for other people. which is usually a microfinance institution. It is
The first source of capital should be the the field partner that collects money from KIVA
entrepreneur. If you are earning a salary or doing and passes on to the borrower and also receives
some kind of business, then save a portion of your repayments from the borrower.
income to finance your new venture. If you do not MYC4 is another online source of capital that
have savings or the amount saved is insufficient is focused on working with businesses in sub
then go for sweat capital. This simply means you Saharan Africa. The business model of MYC4
put your labour, be it physical or mental, into the is somewhat similar to that of KIVA but the loan
business and do not ask for payment in return amounts are much larger ranging from € 1000 to
but rather plough the expected payment into the € 10,000. It is possible to apply for a loan from
business. MYC4 using their website located at www.myc4.
The next source of capital is your family and com
friends. When you articulate your business idea Bid Network whose web address is www.
to a relative or friend they may be willing to fund it bidnetwork.org is another online source of
even though formal financiers are shunning you. funding for new businesses and those which
This kind of funding is usually based on your are expanding. Bid network only supports
character as well as having relatives or friends entrepreneurs with a clear business plan but they
who can part with the kind of money you need. are very versatile regarding the amount of money
In the last decade many online angel and venture entrepreneurs can get from US $1,000 to as high
capital sites have sprung up. To get funding from as US$ 1,000,000.
this source you will need to have a good business If you have a really brilliant new business idea or
plan and a bit of internet savvy. The online funders want to expand an existing business, the internet
can be very specific about the business sector could provide the money you need provided you
they support and the amount of funding they can have the patience to develop a credible business
provide. Three of the online sources of business plan.
capital are KIVA, MYC4 and Bid Network. James Abola is a business and money coach.
KIVA whose web address is www.kiva.org is Email: firstname.lastname@example.org AN
5 TIPS FOR DEVELOPING A BUSINESS PLAN: By Akamai Team
Whether you are hiring a professional to assist products/services to customers
in the process or doing it by yourself, these tips Competition. Ignoring the competition or
will make a big difference to the quality of your assuming they don’t exist is unwise. Competitors
business plan. are a good information source on what works and
Start with the vision. Cast a picture of what your what doesn’t.
business will look like when it is finally done. How Take risks. Businesses do not avoid risk but
much will it sell every year? How many people find ways of managing them. What possible
will it employ? What makes you business different challenges might you face and how can they be
from others and therefore relevant? managed?
Customers. Attracting and retaining customers Financials. Use your clear understanding of the
is the reason why you are going into business. industry and market conditions to develop your
Who are your customers (age, gender, location), financials. Budget your income and expenses;
why will customers buy from you and will there prepare future balance sheet and work on your
be enough customers to make the business cash flow projectionsAN
worthwhile? How will you market and deliver