I have been a bit disturbed by the timing of recent policies of the Nigerian government, there are three in particular that I feel is bound to make a standard of living that is already low, lower:
1) The total deregulation of PMS (Premium motor spirit) which increased the price of the product by about 67%. I am not against deregulation, in fact, it is the way to go, but I thought necessary infrastructure/policies and structures would have been put in place before such statements are made public. The bottom line here is that cost of goods and services will increase, and as a matter of fact, it has increased already.
2) The intended increase of VAT from 5% to 10%. This will increase the cost of goods and services because the increase in Tax will be passed to the buyers.
3) Lastly is the devaluation of the Naira from 196.5 NGN to 290 NGN, even though the Naira had been devalued technically before now. The fact is once the devaluation takes place, the cost of goods and services are going to be affected, and the ripple effect will be hard times for the people.
It is sad to say that the standard of living of people are going to drop tremendously as inflation is set to kick in or is already in as the cost of goods and services have already been reviewed upward. The argument of some people is ‘why will they increase prices now since they are still selling old stocks?’ it is simple, every business person understands that the cost of goods would have increased by the next time they are going to restock so to limit the exposures to higher price they will increase the prices now. If you were the one you will do the same or run the risk of running out of business.
As you know this blog is not about politics but all of the personal finance, let us look at how we can avoid the avoidable and still maintain a good standard of living, this post is like re-asserting what we have posted twice on this blog (get it here: 1,2)
But I will state them briefly again:
One major emphasis this season is contentment, and I will define it as a state of being happy where you are, what you have but yet aspiring for better things.
v Prudence in cash management: Effective cash management is key this season, as all purchases need to be tested well before being made.
v Avoid imported products as much as possible, as the prices are higher and more expensive, seek for alternative locally made brands and goods.
v Manage your taste for luxury goods, I will advise you to spend more on the basic needs rather than luxurious things.
v Invest in capital projects with wisdom; do not invest in capital projects at the expense of the basic needs of food, shelter, and clothing.
v Work smarter and harder to avoid being sacked for whatever incompetence reason.
v Use your clothes and shoes well so you don’t have to change them almost every time, this will save you some money.
v Say No to Aso-Ebi, you need every Kobo.
v Haggle Price well to get the best bargain always.
v Do not take a personal loan without proper analysis.
v Take trips and visits with caution, as the cost of transportation as increased
v Multiple streams of income are needed more than ever before. A tip if you have to sell anything I will advise you sell food related items because food as one of the basic needs of man must be satisfied first before others are thought about.
The list is opened for you to add more as we need to help ourselves get the best of the situation.
I remain your friend and Personal Finance Coach Babatunde Ayorinde, follow me on twitter @pistis03,
And if you like to engage us to speak in your program or for adverts send us a mail at babat09@gmail.com.
Thanks for reading, invite your Family, Friends, and Foes to read the blog, as we move ahead to our financial freedom.
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