As a kid, it was easy to have a piggy box constructed by the neighbourhood carpenter. He would construct it for free since he made it out of cheap plywood and leftover wood shavings. There would be a slit in it, enough to drop in one naira coins and five naira notes. Your mum would encourage you to put in a fraction of your dash money in this box and soon, it would have some weight and jingle richly whenever you shook it. On a certain day, when you could no longer force in a coin to this piggy box, it would be smashed. This was a great occasion and after counting your loot, everyone congratulated you, then your mum used the proceeds to buy a nylon shirt – a veritable lesson to you on the importance of a savings culture.
Life is different as a young adult and the vagaries of savings change. Now you have food, real good treats, outings, clothes, electronics –phones, cameras, game consoles, maybe a professional course or driving school all competing with your desire to save. It’s no longer as easy as slipping a coin into a small plywood box. Here are a few tips to help you:
(i) Invest in assets – things that can make you more money – rather than liabilities – things that simply exist and you have to probably maintain. That is why a laptop is a better investment than a new wardrobe since a PC will help in your academic, self development and entrepreneurial pursuits. Ranking of assets and liabilities are subjective though. See ‘Rich Dad, Poor Dad’ by Robert Kiyosaki for more.
(ii) Always save a certain part of your income. The classic, ‘The Richest Man In Babylon’ advises to pay yourself and save 10% of your income.
(iii) Spend a bit: Many in the course of saving do not reward themselves and you know what this leads to? A spontaneous splurge that takes them back to Ground Zero. So while saving, take out some money to give yourself little treats –like performance points – so you don’t feel overly deprived or stifled.
