Most common money mistakes made in Accra

David Letsa
Jul 24, 2017 · 7 min read

Being financial astute in one of the African continent’s most expensive capitals is definitely not an easy task. Earlier this year, Ghana made it to the Independent’s article on the most expensive countries to live in, see here and also this story on Ghanaweb. This is a rundown of financial mistakes you can avoid to prevent unnecessary monetary burdens, it is mostly tailored for people living in Accra, Ghana but some of these principles are universal.


7: Having a debit card or credit card you don’t use

Banks love to pitch this idea that you need an ATM card whenever you’re opening an account. Imagine this bank worker at the help desk who could have been a probable Mr. World Ghana or Miss Malaika Ghana telling you all the amazing benefits of having that MasterCard or Visa. You can already picture it in your wallet, that whenever anyone gets a glimpse they would see the card and straight away know you’re well to do.

I totally encourage getting an ATM card if you actually need it and will use it. Some banks offer ATM cards without charge. It has so many benefits such as being able to use it during non-banking hours but there are other alternatives that might be more suitable for you such as SMS or Internet banking or even using mobile money (more on the latter, shortly) which would be cost-effective and used more frequently. But the danger being highlighted is having an ATM card you rarely use and you being billed for it.

Let’s do some calculations, if a certain bank charges a fee of 10 GHS and if we take into account that most ATM cards expire in about 5 years, that means 10 GHS * 12months * 5 years = 600 GHS, and that is if only the monthly (some banks charge quarterly) fee for the ATM card does not increase. The advice is in the math.

The danger being highlighted is having an ATM card or linked bank account you rarely use and you being billed for it.

6: Buying quality clothes and everything else

There’s a reason why thrift shops work and second hand clothes still sell. The obvious reason is that it cheaper or more affordable. But insight lies in the less obvious reason; quality. Whenever you buy clothes (or anything else that is tangible) you look at the item and subconsciously check the very basics of design first of colour and shape, then you reach for the item and feel for it’s texture and form. Then you think is this iPhone comfortable in my hand and easy to use? Is this a dress I could where to dinner? These and other questions help you contemplate the worth of the item but a more defining trait of worth is durability, the simple question; how long will it last?

Tɔ papa prɛko

Your mom might have some really costly cloth or African wax prints hidden somewhere in the house or your dad has shirts from the 50’s that still never fade or there might be some kente cloth in your family home passed down for generations. Trust that there’s a correlation between expense and quality. But remember there is also a correlation with time that is since quality items last longer so in a way, it’s an investment. As a common Akan saying goes tɔ papa prɛko which can be translated; Buy quality at once.

5: Not caring for your electronic devices

We live in a world where our electronic devices might be a poor reflection of what lies in our bank accounts at one time or another. If you think about it, the price of the iPhone 7 starts at $649 that could buy a list of kitchen appliances (I averaged these prices from amazon.com: microwave about a $100, a good fridge about $250, toaster about $30, Food processor or blender about $60, coffee maker about $50 and even a counter top oven at $100. All these would sum up to $590 imagine that).

So if we are going to have such expensive devices at hand we must at least care for them. Can you imagine the feelings of stupidity that would encompass you if you spilled a drink on your own laptop or stepped on your tablet or if you cracked your phone screen? (These guys can help with the later: http://www.apparafix.com/). Regular maintenance and keeping our devices safe from 1000 GHS mistakes can save us from financial burdens.

4: Having the wrong type of bank account

The two most common choices are a savings account or checking/current account. Both have their benefits. But if your ultimate goal is to hold money for easy convenient access, then the current account caters more to your needs. In contrast if your aim is to indeed save money then the restrictions of a savings account work to your advantage.

You might be losing money directly or indirectly if you have a bank account that doesn’t suit your needs. Many people have both of these options but it is financially sound to move money you intend on keeping to your savings account and leaving less money in your current account so you’re not tempted to overspend or so that the money is not left at the mercy of deductions.

3: Living out of your means

This just reminds me of the 90’s BBC show Keeping Up Appearances created by Roy Clarke. The show follows Mrs. Hyacinth Bucket (she prefers when you say Bouquet rather than Bucket) who is so self-obsessed with her reputation and pride in that reputation in the middle class and she would likely do almost anything to maintain that standing much to the frustration of her husband who could careless what others think and just wants a simple life.

Living within of our means allows us to grow and develop while also affording us the environment to start saving and even investing our money into different ventures. The opposite, living out of our means would result in one thing: debt. I doubt when anyone is on their deathbed they would look back and think; “damn, I should have bought more Gucci (or whatever designer comes to mind).”

“a lot of people will say… spend on experiences, not on things, but sometimes you can’t afford experiences either”

We have to admit to ourselves that there will be periods of time when you can’t go to every party or eat at a new fancy restaurant because you’re trying to save and build a future. You can decline such invitations or suggest less expensive alternatives such as a movie night at home or eating at home rather than going to the nearest KFC (it’s my weakness too). The best policy is still being honest, tell your friends that you’re on budget, if they are really your friends, they would understand.

There’s advice on the internet that could be misleading such as when it is said, don’t spend on things but spend on experiences or travel instead but as The financial diet aptly put it; “a lot of people will say… spend on experiences, not on things, but sometimes you can’t afford experiences either”

2: Not budgeting

As William Feather said, “a budget tells us what we can’t afford, but it doesn’t keep us from buying it.” I agree that a budget doesn’t solve all our financial problems but it’s a start, it clearly shows us what we need to spend on and what we can afford. Living without a budget is like living without the concept of a map. There will be many times you would get lost but having a map limits the chances of this happening.

I could tell you all about the various benefits of budgeting but rather I’d share this insight with you; have you ever considered that if billion dollar companies like Apple and Microsoft as well as powerful nations of the world budget, why shouldn’t you?

1: Not having mobile money

Mobile Money is one of the fastest growing technologies in one of the world’s fastest growing economies. (See here). Being super convenient, secure and easy to use mobile money transactions per year are reaching billions. Thousands of people are active agents and over 15 banks are partners.

The reason why not having mobile money is a mistake is that more and more institutions and businesses are accepting mobile money as an alternative payment option; in fact some businesses have began to solely use mobile money. The growth of mobile money doesn’t seem like it would diminish at all since the government itself is encouraging more cashless transactions. Could mobile money get any better?

Mazzuma is more than a 3rd party application, if you think of what it encompasses, it is like the mobile money upgrade that you have been waiting for. It allows you to send and receive money to or from anyone using any of the telecom networks in mere seconds! It even has a dashboard which records all your transactions even making budgeting easier. You can even use Mazzuma on Facebook Messenger! Don’t be a spectator and not use this revolutionary technology; get Mazzuma now!

Accra in scoops

A tasty and fresh persceptive on life in Accra, one scoop at a time.

David Letsa

Written by

African gentleman. Medical student. Entrepreneur. Photographer. Book worm. Hip hop and r&b listener. Comic book nerd. Tech enthusiast. Occasional writer.

Accra in scoops

A tasty and fresh persceptive on life in Accra, one scoop at a time.

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