28/09/2018
WHY MOST PEOPLE GO BROKE
Many Nigerians are clearly not experts at managing their own finances and end up broke in the long run. The cycle of over and unnecessary spending leaves them poor, even if their income means they are considered well above the poverty line. They do not have adequate knowledge, time or tools required to keep themselves from going broke in the long run. So I will give some reasons why most people go broke and also give ways on how to avoid it.
1. Most people want easy and fast money: Too many people are looking for the quick and easy way out of poverty and are trying to get rich quick as evident in the heavy patronage of various multi-level marketing schemes popularly known as MMM, sports gambling, money doubling etc., expending your hard end money in these programs is a fast way to committing su***de because in the long run you lose all your money and become worse than you started out.
2. You don’t stick to a Budget: Having a budget is common sense 101, but sadly many Nigerians don’t even understand what a budget is, we engage in a lot of impulse spending, a typical Nigerian will go to eat at an eatery, after finishing the food will see the snacks and say “ hah this pizza is calling me oh, or my eyes dey this ice cream”, brother that is poverty calling you, always try to have a budget and know the amount of money you have to spend at a particular place or time to avoid impulsive spending which will in turn stop you from going broke.
3. You spend more than you make: A wise man once said, if you make 20 naira a year and spend 19 naira 99 kobo that year you will have rest of mind which in turn makes you live long. Most Nigerians now like to show off and claim to be what they are not, in the process getting loans, or buying things on credit becomes their Modus vivendi, when they cannot offset their loans they resort to gambling hoping to win the jackpot which of course doesn’t work out because the gambling house always wins. They then resort to crime if they are Nigerians and su***de if they whites (Nigerians don’t commit su***de or resign except in few exceptional cases). Having a budget and religiously following it will keep them out of this issue.
4. Spending before saving: Most people spend first then save what is left which is wrong and ineffective, the effective and right way is to spend what is left after saving. This enables you to put yourself under a budget and makes you realize that unnecessary spending on wants will make you go without your needs at least before the next pay check comes.
5. No investments: I read a story of a man who worked for a multinational company earning about five hundred thousand naira monthly for 14 years go broke immediately he was sacked, I wanted to slap him, most people do not know how to make money for themselves, they only know how to make for others and expect some amount of money at the end of the month, they then proceed to squander it before the next pay check and the cycle continues until they are sacked before they realize life is not a bed of roses. People should learn to invest their money so as to have something to fall back to in case of any eventualities.
Finally we at Edgefield capital management limited are a member of the Nigerian stock exchange and can help you handle your investments. If you have any problems or issues with your stocks or you want to invest in the market kindly visit our website at www.edgefieldng.com, kindly comment, like and share this article. Thank you.
