Financial success can be defined as achieving what you hope for or aspire to have financially. Your financial aspirations may change as you go through life. Like you, most people have financial dreams or goals that they hold close to their hearts and earnestly desire to accomplish. These dreams may include owning a home, retiring young, travelling the world, purchasing a new car, giving towards charitable activities, joining politics, building rental properties and the like. Each person has what she/he desires to achieve financially in life. It is these financial desires and aspirations that form the basis for your financial success.  

In as much as most of us will set out in life hoping to achieve these financial dreams and desires, the reality is that very few people ever get to attain their financial desires.

Research on Retirement Statistics

According to the findings of research carried out on the Kenyan retirement environment, out of 100 university graduates who get reasonable employment after college;

• Only 1 will be wealthy at the point of retirement
• Only 4 people will maintain their standards of living after they retire (They can afford a lifestyle after retirement similar to what they had when employed)
• 15 people will take a significant reduction in terms of their living standards after retirement but will be able to survive financially. In other words, they will either move to a cheaper neighbourhood such as going upcountry or spend less for entertainment, holidays and other expenditures.
• The remaining 80 people (80%) will depend on the government for survival, depend on their children, take on another job, and will be poor after they retire or will be dead.

The reality is that all these people start life confident that they will become rich. So, why do most people end up not being financially successful?

Why Most People Never Get to Financial Success

• Many people have never defined their financial goals and have no plan to get them to their financial aspirations. Their investments are therefore not focused towards any destination.
• Many people do not understand the various investment opportunities that are available to them to enable them to grow their finances towards meeting their financial goals.
• Many people do not believe in themselves enough to set and pursue their financial dreams successfully and will generally lose heart and give up when a few setbacks come their way.
• Many people lose time and money in risky investments that promise much but never pan out.
• Most people don’t invest consistently but rather invest only when opportunities arise. This haphazard kind of investing leads to the loss of valuable investment time.
• Many people have bad investment experiences and this makes them afraid or unwilling to invest again.

How to Avoid the Statistics

For us to overcome many of these investment mistakes and increase our odds of becoming financially successful, we will need to have an understanding of how the investment world works. We will also need to write down our financial goals and have a plan of how we will fulfil these goals. We will then need a model or system to keep us disciplined and focused on our plan.