What is the goal this Xmas?

In the midst of our rush to earn money, our scramble to save for retirement, our focus on frugality, it’s easy to lose sight of why we’re doing this. What is the goal? What is it we’re trying to accomplish by getting rich slowly? For me — and for many others — the answer is Financial Independence.

Your Money or Your Life defines Financial Independence as “having an income sufficient for your basic needs and comforts from [sources] other than paid employment”. Financial independence implies freedom. It’s the condition of having saved enough money that you can do whatever you choose. Whether you elect to keep working doesn’t matter — you have enough saved and invested to follow your dreams.

But is Financial Independence just a pipe dream? Is it something only for the lucky and the strong? No, says James Stowers in his book, Yes, You Can…Achieve Financial Independence. It’s a goal that anyone can fulfill as long as she’s armed with some basic knowledge, as long as she makes smart choices.

The keys to accumulating wealthStowers starts with the basics. The first chapter of his book covers the history of money. (A little like this, but with a different focus.) The next few chapters briefly cover sources and uses of money, the dangers of inflation, and the extraordinary power of compounding.

Some readers might argue that this information is too basic, but I disagree; a firm grasp of these fundamentals is the foundation upon which Financial Independence is built. Stowers ends this section by offering four keys to accumulating wealth:

1. Start investing as early as possible. It takes significantly less money to accomplish what you want, and you have more time working for you.
2. Be determined to save on a regular basis. It is an easy way to accumulate wealth.
3. Begin investing with the largest possible sum you can. You will have more money working for you over a longer period of time.
4. Reach for the highest rate of return you believe you can safely receive on your money over time. Each additional percent is important. The higher the rate, the less money it takes to accomplish what you want.

Financial Independence is built upon these four guidelines.Confronting your financial challenges“In order to save money, you must fight to keep from spending it,” writes Stowers in the book’s second section. He encourages readers to set goals, to prioritize wants. “Since money can be spend only once, you need to decide which wants are most important. To do this, it may be helpful to place a value on each of your want.”Exercise: Pull out a piece of paper and list your wants. These can range from a new house to a hot tub to a trip to London to a new blender for the kitchen. Next to each item, write why you want it. (You might want a hot tub, for example, because it would allow you to relax with family and friends.) When you’ve finished, take another piece of paper and re-order the list based on how important each want is to you. If a trip to London tops the list, are you still willing to delay it by spending N10000/month for that gym membership you rarely use?

The challenge is to balance the present and the future. “Money has no value unless one has time and good health to enjoy it,” Stowers writes. He asks readers to know themselves and to make decisions based on their temperament. “If you have to be poor,” he asks, “would you rather be poor now or at retirement?” By planning carefully and investing wisely, you shouldn’t have to make this choice.

Planning for Financial IndependenceAfter covering the basics of saving and estate planning, Stowers describes the path he recommends to Financial Independence. He believes readers ought to save early and often, making regular scheduled investments in the stock market through the use of mutual funds.

Have a Merry Christmas.

5 Ways to Succeed with Your Financial Plan

In a recent post, I wrote about how to make a plan for your financial goals. However, I'm sure you've made plans for other things, as well – such as losing weight, studying more, and other things. Chances are, you've failed a few times. Everyone has, and financial plans are no different than any other goals. How are you doing on your New Year's Resolutions for this year?

#1 - Break it down
You won't be able to succeed if your goals are huge. I suffer from this problem – if I have a huge project in front of me, I won't even get started! I'll just procrastinate and leave it alone. With a goal like "Solve my financial problems," I have no chance of succeeding. However, if I break down the goal to something manageable, such as 'Send an extra one thousand naira with my bill payment,” the goal is a lot easier to achieve! In fact, this is an excellent way to pay down your debt faster.

#2 - Try not to do it alone
Do you have any other friends who are in the same situation with their personal finances? If you know anyone – even your spouse will work, but other friends are even better – who wants to work with you, meeting your goals will be a lot easier. A partner will offer encouragement, help, and advice as you follow your plan.

#3 - Set reminders
You should be reminded of your goal every time you are in a position of temptation to break it. For example, I have a bad habit of cracking my neck, so I wear a bracelet on my hand that reminds me of my goal whenever I feel the urge. I even turned it into a game – if I fail and do crack my neck, I move the bracelet to the other wrist. If I don't have to move it once in a day, I win! You might put a reminder in your wallet, which you will see every time you are about to spend money. Think of the areas where you can improve, and make sure the goal will be fresh in your mind when the situation arises.

#4 - One step at a time
Always have a next step: a goal is achievable if it is simple, clearly designed, and realistic. Every time you complete a step in pursuit of your goal, make sure that your next step is obvious. What exactly do you need to do next to improve your financial situation?

#5 - Declare WAR
When you make the decision to succeed, to break your old habits and to meet your goal, you are declaring war on your old ways. I have a giant sign taped to my computer that simply says “WAR” – it represents my war on procrastination. When you make the decision to fix your financial situation, you have made a huge step towards winning. You have to keep that enthusiasm with you always if you want to achieve your goal.

Remember: it's war! War against your old self, war towards your goal.

Did you know that being unselfish can actually be selfish?

Before I confuse myself and you, let me explain. I used to think that by never spending money on myself or taking time for myself, I was being unselfish. I thought that because I have family that depends on me financially, anything I spent for "me" would be a waste.
I was completely wrong.
Do you know your most important asset? Your home? Nope. Your car? Nope. Your most important asset is you. Yes, you.
Without you, you don't have an income. Without you, your parents don't have a child. You are a producer, and if you're not 100% then how can you produce at 100%? Assets support cash flow. You are your most important asset. You need cash flow to prosper and pay your bills. But are you taking the time to nurture and protect your most valuable asset? If you're like I used to be, probably not.
Here are seven practical ways to protect and grow your most valuable asset: You.

1. Get more sleep. Tonight.
This is hands-down the fastest and simplest way to improve your productivity. With enough sleep each night, you won't need to down those 3 cups of coffee just to get going in the morning. With the right amount of sleep your body property handles food processing. You're less cranky. You're more creative.

2. Cut draining relationships
Relationships are a two-way street. Sometimes they are life-giving and refreshing, other times they are life-draining and depressing. Good healthy relationships go both ways. If you're constantly dealing with relationships that are life-draining and you're not a counselor by trade, it's time to cull your list of friends.
Is dropping friends harsh? Yes, but again, taking care of yourself is not selfish. If you're worn down by numerous draining relationships, what will happen when one of your healthy relationships actually needs you? You'll be too drained to help.

3. Never skimp on insurance
To be able to produce at a high level, you cannot be concerned with factors outside your control. Insurance may be costly, but the peace of mind it provides (Automotive, Health, Life, Property) can provide you with a huge return on your money.
While the cost of insurance is important, your focus should be “how will this improve my ability to produce more income?” Insurance is about transferring risk. The more risk you can transfer away from yourself, the better you will sleep at night and the more productive you will be.

4. Fuel yourself properly
The biggest problem for many hard workers is fuel. It's not that we don't eat. It’s that we don't eat well. We stock up on coffee, Red Bull and fast food to make it through the day. Eating balanced and healthy meals will not only make you feel better, you'll live longer as well.
. Now you have no excuse. Fueling yourself properly is both a short and long term investment in your MVA (most valuable asset).

5. ABL. Always Be Learnin'
When you begin to view yourself as your most valuable asset, your mindset changes dramatically. One area that changed dramatically for me personally was in the area of education. I used to feel guilty about buying a fantastic new business book, or wanting to go to a thousand dollar conference. No more.

Investing in yourself through education is nearly always a good investment. I'm not just talking traditional schooling here, education could be reading that marketing book you've been wanting for years, or attending a free online class or webinar.

6. Do 25 Pushups. Right Now.
I'm serious. Get down and do them right now.
Did you do them? If you did, I'll bet you feel better now. Exercise makes everything better. You'll live longer. You'll feel better. You'll look hotter.

7. Schedule time to do nothing
Put “nothing” on your schedule. Of course, you'll not actually end up doing “nothing”, but you need to schedule that time in if you're not getting enough of it. Maybe you read a book, or go for a jog, or spend time with your kids. Just put it on the schedule.
It may sound selfish to think of yourself as your most important asset. It isn't. In fact, protecting your ability to produce and grow is one of the most unselfish things you can do for your family and your future.

What are you doing to improve and protect yourself?

Do You Know Where Your Money Goes?

If you’re having trouble making ends meet, or your savings aren't growing as quickly as you expect, the question of "Where did my money go?" may constantly be on your mind. Learning the answer may seem like an overwhelming task, but it's one worth doing.
There are many ways to track your monthly expenses. What matters is that you track expenses, not how you track them. You can track things in whatever way makes sense for you: using a program designed for that purpose, using a basic spreadsheet, or even good ol' pen and paper.

There are two main reasons to track your expenses:

1) Discover where you are spending more money than expected

Basic tracking will help you to cut back in areas that you didn't even know were causing problems. The classic example is how much your daily bread purchase adds up to over the year. This isn't done so that you’ll say "I can save x-naira a year if I give up my bread," but rather, "Are those daily bread purchase worth x-naira a year to me?" You may decide that your daily bread is worth it to you. You can't make that decision unless you have accurate information.

2) Set reasonable savings goals

You can't expect to save N10,000 a month (or whatever your goal is) if you only have N1000 left after all of your expenses. Without accurately tracking your expenses, you’ll likely be frustrated if you cut back on spending and don't see the results you expect -- even if your goals were not reasonable.

You will gain control of your finances after you decide which expenses are necessary and which can be cut back. Set reasonable saving goals for yourself. Limiting certain expense categories can help you to stay on track with your plan. This entire process will only work if you have the discipline to stick to your plan. Fortunately, the pain of passing up an "urge to splurge" gets easier the more you do it.

Give your children a Gift that will keep on Giving.

There are many occasions for giving gifts, especially to children. And one of the biggest occasions is coming up: Christmas. You might give clothes that the children can wear or some toys that will keep their attention, or you can gift them some shares of stock.

Buying them shares of stock might set a different course for their financial lives and get them interested in investing and personal finance at a young age. If presented as a fun game, kids will usually enjoy the experience and will want to learn more.

You can even download software for them to track their stocks or you can use a simple spreadsheet.

There are different ways to accomplish this. If you already use a stockbroker, there might be offerings available to help you, so check that out first. You can also use a service like http://www.investordelight.com/ to track their investments in all kinds of graphs and get them accustomed to online investing.

Once they have their shares, you can also introduce the children to fantasy stock markets where they have an imaginary amount of money to trade and compete with other children. There are many benefits to having children learn stock investing.

A good place to begin might be Young Money, where they can start with an imaginary $10,000 in fantasy money.

If you wish to give something more hands-on, consider Cash Flow for Kids, or the regular Cash Flow game if the children are older. Cash Flow makes it real and offers a fun way to learn the basics of personal finance.

Whichever gift you decide to give, make sure it’ll be something more than just a temporary moment of excitement and continue to pay dividends for a long time.

How do you manage your TIME?

We’ve all heard that time is money, and anyone who’s applied quality time management strategies can attest to that fact. Knowing how valuable your time is may inspire you to work on your time management skills.

The point is that there are usually a small number of critical tasks that, if completed, would make it a successful and productive work day. While this discussion deals with tasks at work, the method also works in other situations, such as household tasks. The problem arises from the fact that the critical tasks are typically associated with some level of discomfort and so we do our best to avoid them. We introduce other, less important, tasks into our lives to stay busy and avoid the tasks we really need to get done. By removing those non-essential tasks and focusing on getting the critical, yet uncomfortable, tasks done, we can accomplish a successful day's worth of tasks in a short amount of time.

This concept ties into the subject of procrastination. It always seemed like my semester-long projects in school were accomplished in the last few days before they were due. If I had worked on the project up front with the same amount of focus and desperation, despite the discomfort (i.e., lack of sleep, etc.), that I put into it at the end anyway, I could have completed the semester-long project in the first week of the class. If that was the major contributor to my grade, as was often the case, I would have freed up a significant amount of time, since I might not have had to go to class anymore or put in the same level of effort for the rest of the semester that I might have otherwise.

What distractions are you using in your life and what are your critical tasks? Perhaps you've been avoiding doing something about your debt because you're afraid to take an honest look at your finances or because you assume that doing something about it will be difficult. It may be time to push aside the distractions and take decisive action such as consolidating your debt.

Take decisions and act on them.

PROCASTINATION - No1 Investment Mistake

Time is your greatest friend. Once you have decided to get onto the Investment Ship, you are automatically given an ally. Time is your asset. Depending how you use this asset, it can work for you or against you. By putting forward your investing, you are not utilizing the time asset.
Time and amount of money required are inversely proportional. What this means is the more time you have, the less money you need to invest. The longer you wait to get started with your investments, the more money you will have to put in to get the same type of return as somebody that started earlier.

Here's an example: Let's take three people, Mikel, Stanley and John. John was smart and at age 20 he started investing N1000 per month. Stanley started investing N1000 per month at age 25. Mikel, always waiting for the "right time", started investing at the age of 35. Assuming 9% return on their investments, and their desire to retire at age 65, how much will have each have if they continue investing N1000/month until they retire?

Waiting five years to start investing cost Stanley N272,355.82, and waiting ten years to start investing cost Mark a total of N446,309.40. That's almost half a million naira (ignoring taxes).You might be looking for the right time to start investing. The only "right time" to start investing is today. Putting off investing for any reason is going to cost you much more in the long run than getting the timing correct.

Make it automatic -- one of the secrets that the government uses to make sure that everybody pays their income taxes is that they have it automatically taken out of your paycheck before you even see it. Once the company sets up payroll taxes for you, there is no more thought that goes into paying the government.

You should follow this system. Make investing automatic. There are many ways of investing and saving automatically. You can have it taken out of your paycheck and automatically invested. You can have a certain amount taken out of a bank account monthly.

Meanwhile, whatever you do, start your investment plan today.

Are you investing for the right reason?

Ok, you have finally realized you must start putting part of your income away(investing, I mean) for your future and you have taken the steps to achieve this by diong so, but are you actually doing it for the right reason?

Take for instance, you put some money into stocks and mutual fund. Then out of the blues you begin to pump money into insurance for a three year plan because you have been promised by a sale agent of a good payout for the current year. If you jump at this offer, thereby negleting the plan you have already setup, then you will rock your financial boat for the future.

You need to look out for details such as past dividend payment history, past earnings etc to be convinced you are taking the right step and not tying up your money for long periods in unexpe ted investment plans.

Happy investing.

How to Break Up With Your Bank.

Are you Banking with a bank you do not necessarily want to bank with? Well you do not need to keep yourself stranded with any bank in this days of various banking opportunities because you have many options for your banking needs these days.

With the number of banks all around us there is no reason to stick with a bank you don't like. You would come across some difficulties along the way as you try to complete this process but it is worth it.

Reasons to Switch Banks

1. Location Change: You might be moving to another location and need to avoid long distance charges by your bank for operating an account not domiciled in your geographical location


2. Poor customer service: A repeated pattern of negative interactions with customer service can be frustrating, especially if you prefer a human touch on your cold-hard finances. Again, there's no reason to put up with this when you can easily go elsewhere.


3. Opening a new joint account: If you get married or form a domestic partnership, you may want to get a joint account with your spouse. If the two of you use different banks, at least one of you will need to switch. The same holds true in any situation where two people decide to combine finances into a joint account.

Conclusion

Switching banks takes some work, but almost all of that work can be done online these days. You usually won't have to wait on hold on the phone or visit the bank in person. The most challenging steps in the process are choosing your new bank and simply remembering to switch all your linked accounts. It's an inconvenience to be sure, but it can improve your financial situation, and if you're moving, it's often a necessary evil. No matter what your reason for switching, changing banks gives you the opportunity to secure lower fees, higher interest rates and better customer service.

Cut your food bills in half - Save Extra Cash.

Rising food bills are squeezing many families' budgets but your number 1 Personal Finance site will have proved that it is not difficult to cut the cost of shopping in half.
Necessity is the mother of invention and the credit crisis facing the economy what with the Stock Exchange losing over 30% of its value from March 2008 till Date.

Read the full story below of Kelly Parry, a hairstylist who reduced her family's food bills and they took a vacation wtih the savings (Source : www.telegraph.co.uk )


The Welsh family whose savings paid for a holiday in Spain

Kelly Parry, 27, a hairstylist from Brecon, decided to ditch her weekly food trip in favour of a fortnightly shop.

This proved an effective way to avoid impulse buys and forced her to plan ahead. She started "stretching" her food shopping six months ago when her weekly grocery bill became too high. She is married and has a baby girl, aged one, and a teenage daughter.

She said: "We buy food in Asda, as we both work full time, we live off frozen food and use up what's in the freezer. I know we are supposed to eat healthily, but frozen food lasts longer."
Talking about the rising cost of food, she added: "It's so expensive we can't afford to chuck it away. It takes us 25 minutes to drive to the supermarket to go food shopping and the price of petrol is going up."

She wanted to see if she could stretch her family's food shopping to last three weeks.
"I made fresh food such as a shepherd's pie, which we ate with chips, and I froze the other half for another time. I also froze two loaves of bread a week as this lasts longer. I also looked out for bargains such as three for two offers or buying two items for £5 on meat products and made my own curry.

"I'm not bothered about cake and chocolate but my 14- year-old, Danielle, can be a fussy eater. If we didn't have kids, we could budget without chocolate and crisps. I'm not fussed about breakfast, but because of the kids, I have got to have food there. You've got to have a certain amount of food in the freezer when you have kids.

"It was tricky trying to stretch it to three weeks. By Wednesday in the last week, we were already on leftovers and we were not left with a great deal. We spent £30 buying milk, tea, sugar, the odd can of beans and potatoes and extra ingredients to go with main meals. We had to go out and buy more as there was nothing left for making meals before the next big shop."

Setting out to buy sufficient food for three weeks, she brought the cost of her average weekly shop down from £107 to £46, saving an average of £61 a week. She said: "We still go to Asda but only once a month if we need to. If we have to top up on bread or milk, we go to Morrisons. Because of the price of food, it's hard to make it last and with petrol on top, that's why we only go once a month. We have to stretch, the only thing not going up is the wages.

"When we first tried to stretch, we used to buy all the offers, but we still had to top up to make a meal. Now we're more organised with meals and add more variety, like taking a stir fry for lunch, or making a sausage casserole."

The family do admit they are making fewer savings now as they have to top up more often but what they do save goes into a holiday fund. The effort to cut costs has really paid off, enabling her family to enjoy a week-long holiday in Ibiza.

She added: "Until we started stretching the pounds, we didn't think about how we shopped. We used to go around the supermarket and grabbed whatever we fancied off the shelf. I didn't think about it. Everyone likes the nice things – but when you have a family of four, it's worth doing to make a saving."

Get the full story from http://tinyurl.com/66h87h

Read on and resuce expenses for your food.

How to get out of debt.

Getting out of debt might be strenuous for a lot of people but if you are in it you must get your self out of it.

There are three basic steps involved:

• Stop acquiring new Debt: If you are thingking of getting out of debt, never aquire a new one. Being in Debt is already a big challenge so why get sunk in the more. Note that once you make up your mind to free yourself of debt you must take that desicion not to acquire a new one.


• Establish an emergency fund: Save every extra cah you get. Destroy all credit cards and if you pay subscribsions for cable tv, cancel or reduce it (you are at work most times, so why pay full package). Are you subscribed to a nearby gym, cancel it. Do not tell yourself you need all these extras to make your LIFE comfortable. Reduce these extra expenses or stop them totally. You must then save regularly. Why save before paying off debt? Because you will need the experience and you would be able to cope with unexpected expenses. Keep this money in liquid but not easily accesible. It is not for beer, shoes, food etc. It can only be used when your car dies or you break an arm in a game of football.


• Implement a debt snowball: After you’ve stopped using credit, and after you’ve saved an emergency fund, then attack your existing debt. Attack it with vigor. Throw whatever you can at it. Many people say to pay your high interest debts first. There’s no question that this makes the most sense mathematically. But if money were all about math, you wouldn’t have debt in the first place. Money is as much about emotion and psychology as it is about math.Order your debts from lowest balance to highest balance. Designate a certain amount of money to pay toward debts each month. Pay the minimum payment on all debts except for the one with the lowest balance. Throw every other penny at the debt with the lowest balance. When that debt is gone, do not alter the monthly amount used to pay debts, but throw all you can at the debt with the next-lowest balance.

Do these three steps and you would find yourself debt free in no time

Defend your Budget and Attack your Expenses

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Your budget is like your guide. After you have set it up, taking in all necessary parameters you must as a matter of fact defend it with all the strenght you have by attacking your expenses.

A set budget, not well defended will soon be a losing budget. It will accommodate more than it was planned for and begin to cause problems for the individual that set it up. Remember that your Expenses will always try to outweigh your budget.

You must be in charge from the onset to put it (Expenses) at bay. Unforseen circumstanses might force the budget to expand but it will be understandable.

Remember to setup your budget, Defend it vigourously by attack your expenses.

Have a plan for Christmas?

Wow, isn't it a bit early to start planning for Xmas? Well it isn't and if you do not start now December will be just a day away and you would have little cash on you that would be spent in a hurry to satisfy your loved ones.

Planning now makes the task easier because you have an edge in picking the est bargains in town before the Xmas buzz sets in fulltime.

Imagine all the gifts you would have to buy and trips you need to make. Get a pen and paper and break down the task to ease the building pressure on you, set out and achieve.

Remember year 2009 is just around the corner, dont overspend on non important items so you can have enough financial muscle to start the new year.

Be financially secure.

What do you do with your extra cash when you get a payrise?

Yes, you would spend it but it has t be wisely. You get a payrise and you begin to imagine all the things you have wanted to buy. Then you go ahead and spend on meaningless expenses. You do not need to spend all your extra cash when you get a raise.

It is advisable you invest more because your extra cash gives you an opportunity to invest more especially if you are under 40. It makes more sense to increase your portfolio of investments as you have been doing.

Doing this increases your net investments and provides you with better retirement savings. Securing your life after work is very vital and if today, you are spending your investments you might not have enough for the future.

Think over it and reinvest your extra income you will get from JANUARY 2009.

Best Regards

When you get your Salary(income), who do you pay first?

That question will definitely provoke a lot response and why not?. We all have a lot of factors jostling for our income before we even get it.

But who do you pay first? The best answer is YOURSELF. Why? The truth is this - you worked for the money you have earned and it is only proper you pay yourself first. The minimum that is advised to pay oneself is 10% before you deduct all your other expences.

This 10% serves as your cash at hand and overtime your investment pot. This is one of the best way to save and invest on autopilot without bothering if you are securing your future.

It is advisable to still do this type of payment plan even if your work place offers contributory pension. It helps you increase your options even when the returns from the schemes might not be as much as you can generate on your own.

Till next time, start paying yourself FIRST.

The Nigerian Life: Something for Nothing

What exactly have you done for Nigeria? Have you setup a business but it failed due to inconsistent power or policy? Have you been harrased by the Police for driving your car rightfully on the road? Have you invested in a company and now it liquidated?

The list is endless. We Nigerians seem to live in a world where most efforts we put out is wasted not due to our lack of individual effort but mostly on our collective effort in governance and personal endeavours.

We must stop this life of inadequacy and gradually substitute it with sufficiency. Even our economy is not in a good shape right now.

We will continue to give Something to Nigeria but it must no longer be for Nothing.

TAKEN from me - N1000 Movie

I would normally watch movies at home because they are cheaper{DSTV and DVDs} but I was at the cinemas yesterday and I paid a thousand naira to watch a movie titled TAKEN. This is excluding Pop corn - Seven Hundred Naira, Drinks - Five Hundred Naira. And to think I Paid for two in the spirit of Celebrations.

We all need to unwind from time to time but overspending your financial limit is definitely not advisable. When you know your limit your finances not be taken from you except you have planned well ahead for your next N1000 naira movie.

I would like to note that I really enjoyed myself though and I am sure you too had a nice time. I would recommend an outing for everyone as long as we all plan ahead for it to avoid your plans being taken to the slab.

Have a lovely day.

One Decision That Can Make Anyone a Multi Millionaire

For most of us, having a million naira or more liquid — that is, available for our use at any time, and easily convertible into cash — is the stuff of big dreams. But after talking to a few of my friends about decisions they were making, I was able to easily articulate one way we can all have N1 million minimum — liquid, available cash — in our lifetimes.

No, this isn’t some “get rich quick” scheme, and it doesn’t require anything illegal or immoral. It’s actually quite simple. The one catch is that it’s easier to do earlier in your life. But it’s something anyone can do, and is easily within the range of most Nigerians. You have to follow some rules to make this work. But once you do, you’ll be a MILLIONAIRE.

What is the decision?

Buy a cheaper car, and invest the difference.

Yep, that’s it. Let me break this down: how does buying a cheaper car make you into a millionaire?

For this exercise, I am going to assume you are 25 years old, and you want a million naira by the time you are 40. Let’s also assume for the sake of argument that you are interested in a car that costs N3, 200,000 and you have little or no down payment.

If you take a mortgage option from the company selling the car and you have to pay around N70,000 to N90,000 per month, you would se that this is quite a lot of money. Having this in mind, you might ask: Where does the million Naira com from? Spend N700,000 instead of N1, 200, 000 which you can easily do by getting a used car or a slightly cheaper car. Your car payment over the same term comes to about N30,000 to N40,000 which gives you a savings of N60,000 per month. Put this amount per month into a mutual fund earning 10% per year. Here’s the catch: You have to invest the extra N60, 000. You can’t blow it on food, TV, music, etc. I strongly recommend you find an investment service that will take the money directly out of your paycheck so you won’t be tempted to spend it.

Once you’ve done that, find a mutual fund that will give you high returns on your money. This shouldn’t be too hard because we have strong companies in Nigeria and Abroad, put N60,000 in it every month, and leave it alone!!! for the next 20 years. Let the compound interest magic work for you.

Invest N60, 000 a month at 10% for 20 years, and you will have a cool N17, 840,000 saved up for retirement. If you are still having trouble deciding what you want to do, I recommend you visualize a pile of the money in cash and a used car on one side, and a brand-new car on the other.

Which would you rather have?

Do you care about your Finance?

Welcome to this first post on this blog on Personal Finance. It promises to be a very exciting ride. What is the present condition of your finances? Is it in good condition(no debts, liabilities etc) or in very bad shape (hiding form your debtors, including the bank representative). your Personal Finance should be of great concern to you as you must live within your means to avoid a financial crisis for yourself and your family.

Making sure your financies are in a great shape is what we will be dicussing on this blog and I m certain this will be the reference point for personal finance in the next few weeks. Managing your income and expenditure helps greatly as little details might end up taking a chunk of your money.

I would stop at this point for, but remember to be financialy prudent.