Nigerians are being encouraged to rethink their approach to wealth creation by abandoning the notion that it requires a high income. According to Gloria Onosode, Director of Enterprise Sales at FairMoney Business, wealth creation can start with the income available to individuals, rather than waiting for a salary increase or business breakthrough. Onosode emphasizes that financial stability is not solely dependent on income level, but rather on disciplined saving, responsible borrowing, and deliberate spending.
Onosode notes that the pursuit of financial stability can become a moving target as rising incomes often bring additional responsibilities and increased lifestyle spending. She argues that wealth creation should be treated as a consistent financial habit, rather than an activity reserved for periods when individuals have excess money. This approach is particularly relevant in Nigeria, where households are grappling with rising costs of food, housing, transportation, education, and other essential needs.
Onosode stresses that financial resilience is the foundation of wealth building, and advises individuals to understand their cash flow, control recurring expenses, reduce unnecessary spending, and establish emergency savings. She suggests that salaried workers can start by automatically setting aside part of their income, while freelancers and gig workers with irregular earnings can save more during periods of stronger income to cushion weaker months.
Even modest savings can establish a sustainable habit that grows alongside income, according to Onosode. She cites the example of saving between N5,000 and N10,000 regularly, which may appear insignificant initially but can provide the foundation for stronger financial discipline over time. Onosode also highlights the role of digital financial services in helping consumers organize their savings around specific needs and goals.
Onosode identifies responsible borrowing as another crucial aspect of wealth creation. She warns that easier access to digital credit should not encourage consumers to treat loans as extensions of their income. Instead, borrowers should carefully assess the purpose of a loan, its total cost, and repayment schedule, ensuring that repayments remain within their financial capacity without compromising essential expenses.
Lifestyle inflation is another major obstacle to wealth creation, according to Onosode. She explains that higher earnings can quickly disappear into more expensive consumption, subscriptions, travel, and other discretionary expenses. To avoid this, Onosode advises individuals to channel part of every income increase towards savings, financial goals, and appropriate long-term investments.
Onosode's advice is part of a broader effort to promote financial literacy and inclusion in Nigeria. FairMoney's savings products, including FairSave, FairTarget, and FairLock, offer different options for managing savings. By adopting a more deliberate approach to managing their finances, Nigerians can build long-term financial security and achieve their financial goals.
Key points
- Wealth creation starts with having a plan for the money you have, not with having a lot of money.
- Financial resilience is the foundation of wealth building, and requires understanding cash flow, controlling recurring expenses, and establishing emergency savings.
- Responsible borrowing and avoiding lifestyle inflation are crucial for achieving long-term financial security.
