Literally no Nigerian googled the word “recession” in 2015. I’d bet that some people hadn’t even heard the word before 2016. This year though?! Well, just look at the graph below. It’s been a tough 12 months for most of us and unless you are raking in money from some new business venture or you are now earning your salary in forex, you are poorer today compared to this time last year. Fact! The devaluation of the Naira, double digit inflation and an economic contraction have all combined to make the money in your pocket buy less today than what it could exactly 12 months ago.
“So what’s the outlook for 2017?” you may ask. Well, more of the same I’m afraid. The reality is that the drivers of the present economic situation are still driving in the same direction and they aren’t looking back. Crude oil prices are likely to recover, yes, but not to the same levels we had in 2014, meaning that government revenue and FAAC allocation to States will still be suppressed. An economic recovery could happen next year if we suddenly get a huge or steady influx of foreign exchange but in reality, that influx is most likely going to come courtesy of an IMF loan (my prediction) and that loan will come with crushing austerity measures, the likes we haven’t seen since 1987. If 2016 was bad, then 2017 is going to be ugly.
Are We Children of A Lesser God?
Now, would you agree with me that despite the hardship in 2016, some people didn’t seem to be affected at all? For example, some people bought brand new cars this year. This year!! With 2016 prices!! Earlier in the year, I met a gentleman who apparently just furnished his house in the East and all the fixtures and fittings were imported. Despite the expense, he and his family haven’t gone “home” once. The house is just locked up. Some people are still throwing lavish weddings, taking multiple foreign trips and night clubbing like celebrities. It’s almost like we are living in two different worlds.
For those who are seemingly immune to the recession, there is one thing that I have found that is common to all of them (besides of course, the charlatans who are amassing crippling debt just to fund their lifestyles); they all have savings. The have amassed a pile of cash which they can dip into when times get hard. For the truly discerning, they not only have savings, they also have investments. They have assets that are earning even more money for them. You must have heard the phrase “Let your money work for you” or “Making money while you sleep”. That’s what these people have.
So if this recession is dealing with you it’s probably because you don’t have savings, not enough savings or you have only one stream of income and it’s drying up fast.
Don’t Save To Consume
You have saved before; I’m certain of it. At some time or the other you have tried to accumulate a store of money but you may have been doing it wrong that’s why things aren’t looking so rosy right now. You see, what you have been doing is saving to consume. Saving to pay your rent, school fees for your kids, a new dress or new laptop, or whatever; they all fall under the same category: spending to consume. You build up a pile of cash, then after a while you gather it all up and hand it over to someone else in exchange for a depreciating asset or some form of gratification.
The real essence of saving money should be to improve your life and that of your family; to make your tomorrow better than today. When you save a pile, you should then invest in an asset or a business that will make your money attract more money and that’s how to become rich.
You may be expecting that one day you will “hammer big time”. Expecting that someone will come along and just drop a life changing amount on your lap. Well, I will be praying along with you for that day to come but in the meantime, you need a plan B.
The Savings Challenge
You may have been nursing an idea for a business for years now but the lack of capital has always been a stumbling block. The truth is that during the period you have been dreaming and wishing, you could have saved up the needed capital slowly and started the business by now. The purpose of this Savings Challenge is for you to accumulate N1 million over the course of 2017 so that come 2018, you have the capital you need to buy an earning asset that will make you immune to this recession and any other recession. Even if all you do with the savings is buy a financial instrument that pays a coupon higher than the inflation rate, it’s a good place to start. I am offering you an opportunity to change your life forever, to stop being broke and wishing for someone to come and change your fortunes. You have all that you need to turn your life within you so get out of your own way and start saving towards N1 million. It’s not going to be easy, but how many good things come easy?
If you accept the Savings Challenge and want to save N1 million by the end of 2018, fill the signup form and I will email you a free workbook which will be your guide through out the year. Over the 12 months of 2017, I challenge you to save a certain amount every week (as shown in the workbook you will get). These amounts start small initially so you get into the habit of saving but will grow weekly. I recommend that you save weekly rather than monthly so as to cultivate the habit faster.