A sweet high

In the morning prior to my last post, I had a cup of tea accompanied by a full-fledged teaspoon of sugar. Today morning, my cup was accompanied by a teaspoon of hope...and a chapati. Such is the situation in most Kenyan households. The price of sugar escalated to historical values overnight. I passed by a supermarket yesterday to buy some and was shocked to hear them say that they didn't have any (obviously holding stock). Some places are selling it for Kshs 235!! At such a price, you're better off having plain bread -with salt from our tears- for breakfast. As if that were not bad enough, food prices are shooting up like its a race. Flour, butter and rice are but a few examples.
Speaking of inflation, Kenya's moved up to 16.7% this month, up from 15.5% in July. ANOTHER historical high for my beloved country. Here's what it means: High rates of inflation lead to inefficiency in a market economy and, in the medium to longer term, to a lower rate of economic growth. Movements in the general price level are influenced by the amount of money in circulation, and productivity of the various economic sectors. If I'm not mistaken, the Central bank called back some money a few months back....or was it a plea to citizens to let go of the coins they were holding?? Basically, the money in circulation had/has gone down. Couple this with a depreciating currency and you have a nation of desperation. What one could buy with a money 'X' is much less. That $1000 note book that used to cost Kshs. 80000 now costs Kshs.94000. That's what inflation means.
There's other ways to survive though. As of tomorrow I'm replacing sugar with honey, butter with jam and faith with dreams (they can still come true). Some alternatives are much cheaper and even healthier. After-all, I'm still investing in my physical health and financial future.

Accomplished one of my 2011 goals :)

Straight to the point....I finally opened a bank account. One that I'll actually use. I had one before but I figure it's been closed due to inactivity (2 years of no transactions). If any of you jacked me within that period, you would have found a few notes in my socks and other areas. Lakini sasa....tough luck!

"He's only opening a bank account now?" Yes, yes I am. I've always been against the notion of keeping my money in another institution's hands only to be charged for either withdrawing my own money or simply keeping it there. Alas, it's necessary. As much as there are 5 layers of security to get through before you reach the 600 bob under my pillow, a bank somehow feels safer.

Bank accounts differ from bank to bank. Here are some common types:

1. Checking account: Commonly known as current account and used for daily transactions at a fee. Withdrawal can be done at any time and there's no limit (unless you intentionally put one or are withdrawing more than what you have). No interest on deposits. Use it preferably if you're in business.
2. Certificate of deposit account: Commonly known as fixed account. Earns a relatively high interest on deposit (which is made once and for a fixed period of time). You cannot withdraw until its maturity. In Kenya, most banks require a minimum deposit of Kshs 500,000. The longer the period, the higher the interest earned.
3. Savings account: These are meant to encourage a saving culture. Fair interest is earned on deposits and one can only withdraw a given maximum and a given number of times in a month. The trick is to find a bank that offers a rate that will help you beat our 16+ % inflation.

With the introduction of M-banking (transactions via one's mobile phone...at a fee) and E-banking (Remote banking transactions via internet...at a fee), banking has become more efficient if not quite enjoyable. Having an ZAP, YUcash, Orange, MobiKash or M-PESA account really helps with this. Research on the various student accounts available in your area. Sit through those tasteless bank account advertisements. God knows some are better than their actual service. Till next time...