2023 will go down in history as one of the most interesting years for Nigeria. A sensitive political year for her democracy, it has recorded a high level of decline in the standard of living and overall well-being of citizens. Starting off the year with a cash scarcity that had the entire nation in a frenzy, to the eventful election season, the ever-fluctuating naira-dollar exchange rate, and the hike in the general cost of living, the financial impact of 2023 on Nigerians has been life-altering.
According to the Central Bank of Nigeria, the inflation rate on general prices has risen from 24.08% in July 2023 to about 26.72% in September. The 2023 Appropriation Act as signed by the former President Buhari, only approved subsidy payment on petrol till June 2023 and the newly elected president Tinubu reiterated this at his inauguration. This almost immediately raised fuel prices from about 198/ 200 naira to about 600 naira per liter. In the same vein, the exchange rate has recently risen as high as over 1000 naira to a dollar, making international and local transactions even more difficult and expensive. In light of these developments, the Culture Custodian spoke to six young Nigerians on the biggest money lessons 2023 has taught them, considering the current Nigerian financial climate.
Amira, 22
My biggest money lesson this year has to be learning to track expenses and taking budgeting seriously. In previous years, even though I would make budgets at the beginning of each month, I barely ever followed them actively or paid attention to how the money was eventually spent. As a result, I spent so much money on trivial things and I just knew I had to make lifestyle changes. It was hard for me at the beginning, but I was determined and resilient. I deleted apps that encouraged my splurging; I reduced my retail therapy and curbed my spending. I also learned the importance of having an emergency fund, no matter how little. I really wish I had stacked up some money as a quick-emergency amount before the year began, but I’m working on that now.
Tunde, 25
This year, more than ever, I learned the importance of earning more and having multiple streams of income. Getting too comfortable earning only naira when I had several opportunities to take dollar-paying side gigs is a regret I still have. I’ve also never been a fan of side hustle culture, so I didn’t bother about having one, but this year has been a game-changer for me. My finances took a hit when the exchange rate rose sporadically, and I had to do a lot of economics just to get by. At one point, I even became frustrated because I felt like I wasn’t doing anything right. But I’ve realized that I can only save so much when I have eaten, please. So next year, I’m definitely focused on finding new ways to make more money.
NK, 29
I’ve always been a spendthrift because I simply believe I attract abundance and money comes to me easily. However, if there’s anything I’ve learned this year, it is that money goes too and it can go for a while. At first, I beat myself up about my bad money management skills, but then I realized that I was only half the problem. Nigeria’s currency is terrible, and there’s no escaping that. So, I’ve decided to extend grace to myself. Lastly, this year I figured out that money doesn’t come by chance, so to make more of it, I need to upskill and work harder.
Tamara, 31
I never really paid attention to investments or savings until this year. In fact, I just opened a savings platform (Piggy Vest) that my friends promised would help me last month. I honestly just always banked on my salary, family, and friends to sort out any and every one of my financial emergencies before now. But this year has been tough for most people financially and I can barely ever get as much help as I normally would. I’ve also started thinking a lot about retirement, having kids, and leaving an inheritance for my family this year and that has encouraged me to look towards savings and investment. For me, that is one of my biggest takeaways from the year.
Mistura, 26
I won’t really call it a money lesson, but this year I’ve learned that there are a lot of things that not having financial liquidity has deprived me of. No thanks to living in Nigeria and earning a small salary in naira. I used to be one of those people who would budget and plan for big purchases and save up to make them. This year made me understand that you’re better off practicing instant gratification than delayed gratification. The laptop I wanted to buy moved from 600,000 to 900,000 in two and a half months. Now, I don’t delay the gratification, it’s now or never.
Thomas, 27
I actually have a couple because this year has been quite enlightening for me financially. One, don’t ever budget or plan for money you haven’t seen or made. You’ll regret it. The second one is paying rent. I’d encourage anyone planning to get a space to make sure their rent isn’t more than 30% of their total annual income.
It’s better to pay a small amount in rent and live as conveniently as you can afford than to spend a huge chunk of your income on housing. As you grow financially, you can move into bigger places, but first start small. That’s my biggest lesson this year.