FINANCIAL MANAGEMENT IN THIS HARD ECONOMY.

Teekay Adams
+2348103903339
tkyautah@gmail.com

Our country is currently facing one of the most challenging economic periods in its history. The cost of living has skyrocketed, making it increasingly difficult for both individuals and businesses to cope. Many companies are struggling to implement cost-of-living adjustments (COLA) to match the ever-rising expenses, and for employees and small business owners like me, the future feels uncertain.

While saving has become harder, especially when expenses seem to outweigh income, there are still some practical strategies we can adopt to safeguard our financial future. Though I am not a financial expert, I want to share a few practices that have worked for some of us, which could help you navigate these tough times.

1. Financial Discipline
No matter how small your salary is, it’s important to develop the habit of saving and investing. If your monthly income is ₦100,000, aim to set aside at least ₦5,000 for a long-term investment. Now, let’s do a simple calculation: ₦5,000 saved monthly for 10 years would amount to ₦600,000. With a modest 20% interest, that’s ₦720,000. While inflation may reduce its value, having this amount set aside could provide a crucial safety net in case of an emergency.

Ask yourself: do you have such a fund saved up? If you’ve been working for a few years, could you set aside ₦5,000 consistently for the next few years? The goal is not to have instant financial security, but to gradually build it up over time.

2. Develop Growth Goals
Beyond your regular job, consider developing other skills that can generate additional income. Can you paint, play an instrument, write, teach, organize events, or offer services like cleaning, accounting, or media management? Whatever your talents, use them to earn extra income. In fact, some side hustles can potentially add up to 50% or more of your current salary, supplementing your fixed income. Don’t rely solely on your day job—drive value from other areas of your life passionately as if your future depends on it.

3. Reinvest Your Money
Don’t leave your money idle. Whether you’re earning from a side business or your regular job, find ways to reinvest and grow your wealth. For instance, if you own a car that’s idle during work hours, consider partnering with a driver for Uber or Bolt. You could make an additional ₦20,000 per day, even after expenses. That’s potentially an extra ₦220,000 per month. Small ventures like this can significantly boost your income over time.

4. Farming & Real Estate.
Farming and investing in land are two reliable ways to grow your wealth. You don’t need to buy land in prime locations immediately—purchase affordable plots in developing areas. A piece of land you buy for ₦150,000 today may sell for ₦500,000 in a few years. Additionally, farming on such land could provide yearly returns. While these may not be huge amounts, they add value, especially when combined with other income streams.

5. Build Wisely
Many people rush to build a house, only to become cash-strapped. Instead of focusing solely on building, prioritize owning property. Land appreciates over time, whereas building a house could lock up your funds without immediate returns. If you must build, ensure the property can generate rental income, rather than constructing a home designed only for your own use. Build gradually, based on your financial capacity, and avoid putting all your resources into one project.

In conclusion, as we navigate this economic reality, it’s important to think long-term and diversify income sources. Even small steps, when taken consistently, can lead to financial security over time.

Credit to Dr Dotun Jegede.