Question

c) Discuss five (5) traditional tools that the poor use to manage their money

Answer 1

1.saving and borrowing through informal mutual financial mechanisms such as savings clubs.

2.saving with individual savings collectors who come around and take deposits.

3.Taking loans from family, from friends or neighbours, from local shopkeepers or moneylenders or other people with whom they have some sort of relationship.

4. Keeping notes under floorboards

5.Poor people seem to rely heavily on rules of thumb, conventional wisdoms, and habitual practices to manage their money.

All these devices are, essentially, ways to turn small savings into large enough lump sums