While annual salary increases are welcomed by some, many Namibians rarely experience such financial boosts. Throughout Namibia, salary increases are often seen as markers of professional achievement. However, for a significant number of people, pay rises are inconsistent or simply do not occur. For these individuals, and for those who do receive annual increases, making financial progress relies more on managing existing income, controlling spending, and exploring opportunities for growth and investment within their means, rather than solely depending on increases in salary.
As Ziggy Muinjo, Head of Investments (Retail) at FNB Namibia, observes, it is not national inflation that keeps many people without savings, but rather the tendency for expenses to rise alongside income. This pattern, known as lifestyle inflation, affects people at all income levels. Whether earnings are static or increasing, the subtle growth of everyday commitments can erode the capacity to save or invest for the future.
He explains how an annual increase, if used wisely, can result in wealth creation: “Take someone earning N$10,000 a month who gets a 10% raise to N$11,000. Instead of investing the extra N$1,000, they add to their monthly bills. A year later, their salary has grown, but their disposable income hasn’t. If that same N$1,000 were invested monthly into one of FNB Namibia’s investment products returning 6.08% per year on average, after 20 years it could grow to over N$466,000. That’s the long-term cost of short-term comfort.”
For those who do not receive salary increases, building wealth remains possible. The key is to value every opportunity to save or invest, no matter how modest. Financial maturity is determined less by how much you earn and more by how much you keep and grow. Consistent, small investments can accumulate significantly over time, even when there are no pay rises.
Consider that a repo rate cut by the central bank, is not just a macroeconomic event, but a personal financial opportunity. When interest rates drop, monthly loan repayments shrink, creating liquidity. The reeal advantage comes when that freed-up cash is redirected into savings or investment products instead of everyday spending. Even small amounts, applied consistently, can compound over time, turning a rate adjustment into a long-term wealth strategy. “Building financial security doesn’t always require earning more, it starts with being intentional about what you already have,” adds Muinjo.
Self-imposed inflation, also called lifestyle creep, gradually diminishes the ability to save and invest, often creating a false sense of advancement. Muinjo encourages everyone, to view every increase, windfall, or saving as a chance to secure future wellbeing. Even those on a fixed income can benefit by spending less and saving more of what they already earn.
FNB Namibia believes that genuine financial growth results from deliberate choices. The following principles can support all Namibians in their financial freedom :
- Lock your lifestyle: Maintain stable expenses even if your income increases.
- Automate discipline: Should your earnings grow, arrange for part of the additional income to be transferred automatically into savings or investments. Even with a steady or variable income, regular saving, however small, can be beneficial.
- Avoid comparison: Resist the urge to match the spending habits of others and instead focus on your own financial goals.
- Invest for appreciation: Direct any surplus, whether from a raise, bonus, or careful budgeting, towards assets that appreciate in value, such as shares, property, or pension funds.
The solution is to be intentional. Spend less as your income grows, and allow your investments—not your lifestyle—to reflect your success. For those with steady or unpredictable earnings, careful budgeting and regular saving are equally powerful strategies.
As the country’s leading financial institution, FNB Namibia is committed to supporting all individuals and families on their path from managing income to building lasting wealth. By providing financial advice and solutions that are accessible and relevant, FNB Namibia aims to help create legacies that are not defined by fleeting purchases, but by enduring financial security.