What is money? 🪙

Money is what people use to buy things and pay for services. In Kenya, the money we use is called the Kenyan shilling (KES). Money helps business owners buy supplies, pay helpers, and grow their ideas into real businesses.

Types of money in Kenya

• Cash (coins and notes) — for small daily buys.
• M-Pesa (mobile money) — send and receive money on phones. 📱
• Bank account — safe place to save larger amounts.
• Chama / table-banking — a group savings plan run by friends or family.

Why money matters for entrepreneurs

• To buy stock or tools (e.g., ingredients for mandazi, pens for school supplies).
• To pay for transport, packaging, or help from others.
• To save for new, bigger ideas later.
• To earn profit — the money left after costs are paid.

Ways a 12-year-old can earn money (safe and legal)

• Sell snacks at school (with permission): samosas, mandazi, roasted maize.
• Make and sell handmade crafts or friendship bracelets.
• Offer homework-tidy, reading help, or tutoring to younger children.
• Run errands or help neighbours (e.g., water plants, sweep) for small pay.
• Resell small items: pencils, stickers, recharge cards.

Tip: Always ask a parent or guardian before starting a business and make sure your activity does not stop you from going to school.

How to save money

• Piggy bank or jar — keep coins and small notes safe. 🐷
• M-Pesa Safaricom Lipa na M-Pesa or M-Shwari — if you have adult help to open an account.
• Chama with family or friends — everyone puts small money and gets a turn to use the pot.

Simple budgeting — the 3 jars method

When you get money, split it into three jars or notes:

• Save (50%) — for future goals (new tools, school fees, or a big idea).
• Spend (40%) — small daily needs or fun things.
• Give (10%) — help your family or give to charity.

Example: If you earn KES 200: Save KES 100, Spend KES 80, Give KES 20.

Keeping simple records

Write down money coming in and money spent in a small notebook. This helps you know if you are making profit.

Profit = Total In - Total Out. From the example above: Profit = 300 - 120 = KES 180.

Mini business plan example (Mandazi stall)

1. Idea: Sell mandazi at break time at school.
2. Costs: flour, sugar, oil, firewood or gas — KES 120 per day.
3. Price: sell 10 mandazi at KES 40 each = KES 400 income.
4. Profit: KES 400 - KES 120 = KES 280 per day.
5. Use profit: Save KES 140, spend KES 112, give KES 28 (3 jars method).

Always check prices in your area — numbers change, but the idea stays the same.

Tips for young entrepreneurs

• Keep school first — do business after school or during holidays.
• Be honest with customers and give good quality.
• Save some profit for reinvestment — buy more stock to grow small gains.
• Work with family — it is safer and adults can help with money matters.

Quick activities (do in class or at home)

1. Make a budget for KES 200. Decide how much to save, spend, and give.
2. Write a one-week plan for a small business you can start (what to sell, cost, price).
3. Track one day of sales in a notebook and work out the profit.

Glossary

• Revenue: money received from selling things.
• Cost: money spent to make or buy what you sell.
• Profit: revenue minus cost — this is your earning.
• Chama: a group that saves money together to support members.

Review questions

1. What are three safe ways for you to earn money as a 12-year-old?
2. If you earn KES 500 and follow the 3 jars method, how much do you save?
3. Why is record keeping important for a small business?