disappointed with your investment returns

Have you ever invested money and gotten so disappointed with your investment returns and felt like you had just been cheated?

A couple of weeks ago I had a very interesting discussion with one of my followers on Instagram who was quite disappointed by her money market fund returns.

I was recommending a particular high-yielding savings account and she commented that she didn’t think that money market funds were a worthy investment because she invested x amount of money and got less than Ksh 50 as a return on her investment.

This got me thinking about investments, the returns most people expect and why are some people disappointed with the outcome.

So, what are some of the reasons why you might be disappointed with your investment returns?

1. You have unrealistic expectations and comparisons.

There are 5 very important questions you need to answer before you get involved in any investment.

i) Where is my money being invested?

This helps you understand what is the underlying asset of that investment. If you are able to understand that, then it’s easy for you to answer question number two and number three.

ii) What is the risk associated with this investment?

We have:

  • Low-risk investments
  • Medium risk investments 
  • High-risk investments

You need to know what level of risk is associated with every particular investment option.

iii) What is the return associated with this investment?

The level of risk also determines the level of your return. The lower the risk the lower the return and the higher the risk the higher the return. 

iv) Which of my goals does this investment serve?

Most people do not ask this question because they are too focused on chasing the returns and they never stop to ask whether that investment choice aligns with any of their financial goals.

v) How can I best leverage this investment?

 If you’re not able to understand this, then you will find yourself having very unrealistic expectations of some investment options or unfairly comparing them.


As much as I will recommend a Money Market Fund as an alternative savings option, I’m recommending it as an alternative to saving in your traditional bank account.

At no given point should you ever expect bond-like returns from a Money Market Fund.

A Money Market Fund will have interest rates that are fluctuating/oscillating between 7% to 10% depending on the prevailing market conditions.

Bonds on the other hand will give you anything between  11% to 13% depending on the duration of the bond. 

When you’re getting into any investment, you need to understand the nitty-gritty details of  the investment option. This way, you know what return to expect.  

Remember, if you invest Ksh. 500, you obviously are not going to get the same return as someone who invests Ksh.100,000 or Ksh.200,000.

Also, if you just invest Ksh.10,000 and leave it there, you’re not going to get the same return as someone who invests Ksh.10,000 and they top up another Ksh. 10,000 every month.

You really need to understand how each investment works, the risk and return trade-off and how your money will grow.

This will help you manage your expectations.        

2. Not understanding the recommended investment horizon of a particular investment option.

You need to understand exactly how long you should invest in a particular option for you to get some meaningful return.

You can’t complain about the returns yet you haven’t given your investments time to grow/compound.

For instance, with stock markets, in order for prices to go up, the growth of an economy has to happen and this does not happen overnight.

You need to ensure that you understand the recommended investment horizon for particular products so that you don’t expect returns from the stock market after two years and when the return doesn’t come you give up on it .

Yet if you had exercised a level of patience and invested for about five to six years, it would have made more sense.

Patience and consistency are the two main qualities you need to exercise for you to see and appreciate the fruits of your investments.          

3. Lack of diversification and understanding of the different purposes of different investments.

Another reason why you might be disappointed with your investment returns is that you didn’t diversify your investment options.

Most people fail to diversify their investment portfolio because they fail to understand that different investments serve different purposes.

 When you do not diversify your portfolio, you fail to have a proper mix of risk and return.

If all your money was in Money Market Funds, you have not diversified enough since these are a very low-risk investment option and you’ll move very slowly.

Also, if you put your money in only high-risk options, you haven’t diversified enough and you could end up losing a lot of money. 

You need to understand how to properly mix between low, medium and high-risk investment options.

A good portfolio would look like: having two Money Market Funds, one serving as an emergency fund and the other as a sinking fund (low risk). A bond fund (medium risk), offshore investments or even the Nairobi Stock Exchange (high risk)               

This portfolio has a proper balance.  

Remember, different investments will play different roles.

Some are for preserving capital, others for multiplying your capital, while others are to give you passive income or dividends in the long term.

4. The investment product is not a good choice.

Some investment options will disappoint you just because they are the wrong option. Or, you thought they were an investment option but they are really not.

For instance, there are people who buy insurance policies as investments. You’ll find that someone has taken an education policy that barely compensates them for inflation or someone takes an endowment policy or any other policy and is told that he/she will get a bonus.

The problem with this is that an insurance product cannot serve you well as an investment product. 

Insurance is risk mitigation while investing is capital multiplication.

If you use one in place of the other, then you’ll have a problem. 

Sometimes, it’s just that you’ve been sold a product that is not necessarily a good investment product and that is another reason why you can actually find yourself quite disappointed with your investment returns because what was sold to you versus what you end up getting at the end of the investment term is very different.

Ensure you do your due diligence before investing in a particular option.


What you need to know before considering an investment option is, where is your money being invested, what is the risk associated with that investment, what is the return of that investment, which of your goals this investment serves and how can you best leverage that investment.

If you are able to answer those five questions, then you have halfway figured out whether that investment will work for you or not.

In case you’re interested in learning more about investments, I have an ‘Invest for your best life master class’.

In this class, I teach you everything about unit trusts, bond funds, money market funds, government bills and bonds, how to invest in the stock market and how to do proper retirement planning.

This three-hour pre-recorded masterclass comes with a bonus email with recommendations of Kenyan companies that you can invest in.

Get the class here.

Share this post:

Leave a Reply