By David Bello
There has been much talk in the news about a slowing economy and fast-approaching recession. What this means to most people is that job security is threatened, the cost of living increases and people are generally fearful of their financial futures. Well fret no longer. Here are a few tips that I think may better allow you to survive and thrive despite the economic conditions.
A good time to Invest
I strongly agree with Warren Buffet when it comes to many of his investment strategies. He says something to the effect that “when people are afraid of the economy, buy everything; when people are buying everything, be afraid”. What this means is that there are tons of opportunities out there to make huge gains over the next 2 to 3 years. For example, you can find a really good piece of property for much less than was paid for it not that long ago. By conducting an analysis on the property, you can walk away with a price that is far below its appraisal value. When the market rebounds and prices stabilize, then you should have seen a nice gain on the value of your property, be it land, etc.
Get another stream of income
This tip might sound crazy to some people, but it’s always great to have some extra income coming in if you have the time to do it. With various markets shaping up the way they are, it’s a great time to buy many assets that may have taken a significant dip in price but not in value. Getting a second ‘hustle’ or business would help provide you with more cash to pay down your debt, or save and use as investment money.
Put your money in high-interest account
You need to know how hard your money is working for you at all times. You should also be looking for ways to make it work harder in the safest way possible. One of the simplest things you can do is to at least ensure that you are getting the highest interest rate possible in your savings account. Doing anything else or earning interest that is lower than the inflation rate is like giving away free money. It is going to be hard finding any savings account that yields over 3%, so you may need to consider other investment options where you can earn higher.
If you have any kind of debt, pay it off ASAP. This is a great time to do so and borrow less so as to create a debt free life style. Plus, the sooner you pay off your debt, the sooner you will be able to save and be able to invest in better opportunities. Debt will hold you back from achieving financial freedom. So it important that you freeze your frivolous spending today.
Read books on personal finance and investments
You cannot afford to not understand how to grow your money. It will cost you hundreds of thousands of naira in your life-time. If you haven’t already, you should read Rich Dad, Poor Dad by Robert Kiyosaki, Think and Grow Rich by Napoleon Hill, and The Intelligent Investor by Benjamin Graham. Remember, increasing your knowledge is the best way to grow and expand your mind. It is true that knowledge exalts not just a man but a nation.
Eat At Home
In today’s world, this is hard for many of us to do. But when fighting for financial freedom, sometimes it’s necessary that we sacrifice a few frivolities now for a later day when we can afford them. By preparing your own meals, you can expect to save somewhere around N50,000 a month. Not only is this a great way to trim down on expenses, but you can also use it as an opportunity to buy healthier foods and develop healthy dieting practices. Just like building wealth, being healthy is like running a marathon instead of a sprint. Develop these practices for the long run.
Reduce Fuel Expenditure
With the cost of fuel being so high, many people have already started walking as a way to get-around instead of driving their cars. Plan your days effectively and avoid driving as much as possible. If you must drive, maybe you should learn to drive without your air conditioner as it helps reduce your fuel consumption. All these extras you save throughout the week add up and could easily be put towards other pressing needs.
David Bello is the CEO of Eljargor Couture, an Abuja-based Clothing line.