Recession is a period of temporary economic decline during which trade and industrial activity are reduced, generally identified by a fall in GDP in two successive quarters. It is an open secret that our beloved country Nigeria is facing one of the worst recession in her history. Many have lost their jobs, so many businesses have crumbled, the exchange rate has made it difficult to make purchases and the list goes on. In the face of all that is wrong, You can save yourself from recession.
As difficult as it may sound, history has shown that during times of economic recession a new set of ‘money bags’ are created. So many people loss their ability to pay their mortgage and in other to prevent the banks from taking over, they sell at a lower price. So many people are unable to buy new cars so they repair their old cars regularly. People are unable to spend on luxury but they will always spend on food. A smart business person would realize that this period in our economy present more opportunities to prosper. Regardless of the position of the economy wealth creation is possible, it depends on where they stand.
Save yourself from recession
So how does one position himself to be wealthy in a recession ?
Here’s my two cent – save more, spend less and invest wisely.
The journey to wealth creation will begin with you learning to save more. Many individuals save after they have spent, while this sounds like a logical thing to do, it deprives one the opportunity to become wealthy. In a subsequent article I will discuss where you would get money to spend and invest, however in this articles, let’s focus on saving.
Save More, I came across this golden advice while reading the book – the richest man in Babylon by Napoleon Hill. Any one that wants to be wealthy should learn to save habitually. Understand that a part of all you earn must be saved. I hear a lot of people say that what they earn cannot be enough to meet their needs. Here’s my advice, save more and find ways to earn more to meet your needs. If you are serious about your desire to be rich, do not joke with saving – save a portion of all you earn.
That said, let’s talk about why you are saving.
People that become wealthy are individuals that are prepared to grabbed opportunity whenever it presents itself. Most times when the opportunity to be wealthy presents itself, you have a very short time to grab it. Usually, you need to grab it at very short notice and you can only do this with your personal savings.
Save yourself from recession
For instance, if you get an opportunity to start a business usually your first source of funding is your savings. If you are fortunate to qualify for a mortgage you are usually asked to pay a percentage of the total cost of the building. Usually, this is paid for with your savings. There will be times when people will sell out their properties and investments during periods of crisis. The man with savings can make an offer quickly, the man without savings would begin to look for money. Before the man without savings finds the money, the offer could have been claimed by someone else.
Ideally, it is important to note that those that have become rich have learnt that a portion of all they earn is to be saved. In fact, saving has become so habitual that they save first and spend what is left. As a rule, I remind myself to “Save More, Spend Less And Invest Wisely”
In the next article, we would examine another building block of wealth creation.
The next article in this section will be on 3/2/2017
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