3 Must-Have Savings Funds

Life happens, and you have no choice but to adapt accordingly. One morning, your car refuses to start, or your refridgerator goes kaput. Another time, you need to go to a hospital or clinic, and that visit comes with a hefty medical bill that you must pay. The hits just keep coming: business slows down, you lose your job, and the cost of living is at an all-time high.

Over the years, I’ve learned the hard way, that surviving life’s jabs isn’t just about luck – it’s about preparation, and we’re all one bad situation away from having to start from scratch. Your money needs a system because without one, every emergency becomes a crisis that can wipe you out.

I’ve come to the conclusion that we need to build 3 types of saving funds:

  1. A Starter Fund: Protection from life’s minor surprises. You didn’t plan to fall into a debt, but you wake up with a toothache. You have no money and resort to the quickest solution – a mobile money loan or a visit to your local money lender. It feels convenient, until you realise the cost. The loan must be paid back with interest which balloons your debt the longer it takes you to pay it off.

    A starter fund protects you from that cycle. It is your buffer for life’s everyday surprises and helps you build the discipline of saving. Start with what suits your lifestyle. A good rule of thumb is to set aside one month’s expenses. Keep this money somewhere accessible so you can respond quickly within 12–24 hours without borrowing.

  2. A Confidence Fund: Giving you financial stability in the event that source of your income stops. This fund should cover 3 to 12 months of your basic expenses – breathing room to pause and reset while you plan your next move. You can make decisions about your future from a position of strength, instead of desperation and panic.

    Keep this money in a low-risk account that preserves your capital while still earning modest interest, and allows access within a day when needed.

  3. A Sinking (Growth) Fund: This where you intentionally set aside money for investments, major life expenses and making your dreams a reality. It’s what enables you to act when opportunity knocks, whether that’s buying land, investing in a business, or taking part in a promising venture.

    As a single mother, I wanted to secure my son’s university education, so I regularly saved money in a locked money market fund. As the interest compounded, the fund grew, and when tuition was due, I wasn’t scrambling to pay. In fact, the returns helped cover any additional expenses he had while I continued saving. That’s the difference a sinking fund makes, it turns distant dreams into achievable realities.

    Where you keep this money depends on your objectives. Options like fixed deposits, unit trusts, or insurance-backed plans can also help you steadily grow your capital money within your set timeline.

    A word to the wise, take time to understand the risks and work with a licensed provider before you go committing your hard-earned money to any fund.

Start now, where you are, and be consistent. By saving, you’re regularly setting aside money to take care of future you, and handle whatever inconveniences life throws your way. It’s never too late, or too early to start, and no amount too small save.


How are you saving your money? Share in the comments, or DM me – @KagoTMD on TikTok, Instagram and LinkedIn. I really want to know.

Let’s build your future, together.

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