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Financial literacy should be taught as a subject in secondary school. Far too many of us grew up financially illiterate, with nothing in our curriculums that taught us about money. Transactional income was all we were prepared for; aim for a plum job, and have some savings. Yet the truth is that nobody becomes wealthy solely by renting their time out to an employer for wages. Time is finite. Beyond earning salaries and making profits, money must be managed properly and made to grow.

Three lessons

I’ve had the privilege in recent times of spending precious moments with people who have made millions of dollars, and there are certain practices that set them apart. If you’re going to turn your finances around, here are 3 things you should look into immediately.
  1. Don’t spend more than you earn: Tracking your spending helps you live within your means. Cultivate the habit of budgeting, and sticking to it. Take note of everywhere your money goes. If you’re a parent, know that you don’t have to give your children everything they ask for. It pays to be prudent. If you keep spending more than you earn, you will never be able to build sustainable wealth. This is also particularly important when it comes to where you choose to live. Recently a friend decided to move to a smaller apartment after she read advice from experts: If you’re spending more than a third of your income on house rent, you’re living in a place you can’t afford. I commend her wisdom. Be honest about what you can afford right now.
  2. Don’t rely on just one source of income. Money goes out several ways, so if it’s coming in only one way it goes without saying that there’s bound to be a problem at some point. There’s nothing wrong with having a job. What’s dangerous is having only a job. To build wealth, you can’t afford to rely on only one source of income. Multiple sources, and streams if possible, will help you achieve your goals.
  3. Save and invest: Before you start spending money on cable TV, airtime, provisions, groceries, school fees, fuel, house rent and all the other things that gulp your money, put something aside for yourself. Nobody becomes truly rich in one day. Learn to pay yourself first. Cultivating a savings habit can even help you get out if debt, so that you can start investing. It is good to save, but savings alone won’t make you rich. There’s only so much your employer or business can pay you, and only so much you can save. Even if you’re not a big risk taker, interest rates on regular bank accounts are low, compared to investment accounts. Start from there. Putting  200, 000 in an investment account that yields even as little as 10% per annum is still better than leaving it in a regular savings account. From the stock market and forex, to government treasury bills and mutual funds, there’s no shortage of investment options and packages. Let your money work for you. You can also invest in someone else’s business, or in an agricultural venture, after doing your due diligence.
A few years ago the word “transfinancial” went viral; a millionaire born into a poor or middle-class life. However, it is not enough to identify as a millionaire. You must learn to think and relate to money the way millionaires do, or stay trapped where you are.

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This article was first published on 22nd August 2018


Joy Ehonwa is an editor and a writer who is passionate about relationships and personal development. She runs Pinpoint Creatives, a proofreading, editing, transcription and ghostwriting service. Email: pinpointcreatives [at]

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