How to Start Investing as a Nigerian

The greatest investment you can make is in yourself. So, invest your time to acquire skills and knowledge that will make you valuable and increase your earning capacity. You can do this by following some valuable twitter and instagram accounts e.g. kolonigeria, moneyafrica, wealthmotley, @The_MMW, Kalu Aja, Ray Dalio etc.

You need to know how micro economics works, policies and regulations especially in Nigeria. You need to understand the basics of inflation, devaluation  and how they affect your personal finances.

Follow the news, especially the host country of your investments.

Invest in self-education via the internet (Youtube, Google podcast, Coursera), through books( The little book of common sense investing, intelligent investor, Psychology of money, Rich dad Poor dad, Unshakable, Atomic habits etc.)

1. Track Your Expenses

What you cannot measure, you cannot grow. Go through your transaction statements critically. Work with a budget. You can use an app called Money manager and follow the 50-30-20- rule for budgeting.

2. Have a FIRE 

Have a FIRE (Financially Independence Retire Early) number in mind. This is usually your annual expenses can be 25 or 35. This number needs to be in a long term investment for you to retire early.

3. Build an Emergency Fund

As you grow your earnings, start building your emergency funds(i.e. 3-6 months of your monthly expenses). This is not your savings, it's an emergency fund. So put it in a place that is easily accessible e.g. Kolo nigeria, Piggy flex, O wealth and earn interests on it.

4. Invest in Assets

There are several assets to invest into; Real estate, stocks(local and foreign), Eurobonds, Fintech apps etc. If you are looking for a longterm investment with consistent yields and a well-diversified portfolio, put your money in an index fund with low expense ratio like VOO. Invest consistently with a specific amount each month. And let the power of compounding take charge.

Finally, remember all things take time to build. Building the right habit early is the most important part of the process. 

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