Category: Management

Black Friday Spending

Readers of this column will remember that every year in November we discuss Black Friday sales and how prudent investors should manage their spending during the sales period. Black Friday is the day after the US Thanksgiving Holiday. It is the first day of the shopping season and it traditionally ends on Christmas Eve. Retailers usually slash prices of merchandize, and shoppers go into a frenzy trying to buy what they otherwise could not afford. It is a time of shoppers’ delight. 

However, if not properly planned it results in spontaneous shopping, spending outside budgets and getting into debt. Money that should be used for other important things are diverted into things that we do not need. Many times, what we buy are upgrades or additions to things we already have. These purchases boost our egos but deplete our wealth. Remember, if you make an unplanned purchase that promises 50% savings, not buying the item at all gives you 100% savings. 

Black Friday discounts are real, every wise and prudent shopper should take advantage of them, but only in a proactive and planned way. 

We plan by identifying the items we want to buy; even luxury items and occasional indulgences are acceptable as rewards for our hard work. Begin early to save towards these purchases using target savings accounts. The problem with spontaneous spending is not always the items purchased, it is the fact that the spending is unplanned and therefore throws our financial budgets out of sync and delays the achievement of our financial goals. Target savings on the other hand are incorporated into our spending budgets and therefore do not hinder our goals. Open a new savings account or use one in a bank you do not usually patronize. Avoid banking conveniences like debit cards, mobile payments, online banking etc. on the account. This way you are not easily tempted to spend the money on other things. Set up a standing order from your main bank account to credit the target savings periodically so the savings are automatic and not subject to your changing moods or circumstances. Choose a transfer date that is as close to your monthly salary date as possible. This way, you save first and spend what is left. Most people fail at savings because they spend first and try to save what is left, but soon discover that there is never anything left to save after spending. We must always save first. 

To excel at savings, we must master delayed gratification. This concept has almost become taboo in today’s world of instant coffee, instant banking, and instant shopping. Borrowing has become very easy with the FINTECHs that process loans within 2 hours without even seeing the borrower’s face. Borrowing is now instant too. But like we have said in this column in times past, never borrow at a cost (and a very high interest at that) for consumption needs, save towards the purchases instead – hence the need to master delayed gratification. Anyone committed to financial prosperity must learn and master it. With this mastery, one is able to overcome the attractions of spontaneous shopping. 

Avoid using shopping as a pastime. Visit shopping malls with purpose, do not just wander in, especially during the Black Friday sales. Go in with a shopping list, buy the things on your list and leave the mall. Do not take all your payment cards with you, take only the one with the money required for the purchases. Leave the cellphone registered with your bank for mobile payments at home or even in the car so you are not tempted to make USSD transfers or other electronic payments. By the time you leave the shop to get your phone or additional payment cards, usually the impulse for the spontaneous shopping has ebbed. Pay attention whilst paying for the discounted goods; ensure the discounted prices have been entered into the shop’s cash register and that you are being charged the new low promotional prices and not the old higher ones. Set a spending limit for all Black Friday purchases. Share this limit with a trusted friend who can help monitor your compliance. 

In these days of e-commerce, you do not have to leave your house before you shop. Adverts for Black Friday sales are already popping up on our phones and computers. Shopping lists and spending limits will help us remain prudent even in cyberspace. But please remember to practise safe cyber shopping and pay only through trusted sites. 

Buying necessities during Black Friday sales is a great way to spend wisely. Happy shopping. Happy investing. 

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Back To Basics – Multiple Streams Of Income

Cultivating multiple streams of income is a sure way to achieve our financial goals quickly. However, we must be careful to maintain our quality of life and work-life balance. How then can we generate income passively, without spending unhealthy amounts of time working? In continuation of our Back to Basics series, we are discussing Multiple Streams of Income, especially passive incomes. Enjoy the Read

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Back To Basics – Financial Discipline

We cannot achieve our life goals without discipline. In the same way, we cannot achieve our financial goals without financial discipline. But it’s easier said than done. Are there any tactics that make it easier to do?

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Back to Basics – Financial Planning

With all the on-goings in the socioeconomic and political environments, it is time to ensure that our financial foundations are intact, and we have the basics firmly in place. This means we should take   another look at our financial intelligence, financial planning, and wealth building skills.

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Back to Basics

With all the on-goings in the socioeconomic and political environments, it is time to ensure that our financial foundations are intact, and we have the basics firmly in place. This means we should take   another look at our financial intelligence, financial planning, and wealth building skills.

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Goals Setting And Risks Management

AS we begin the New Year, we should set financial goals that we intend to achieve in 2021. These goals must be SMART – specific, measurable, achievable, realistic, time-bound.

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Personal Risks Management

“Insurance helps protect our investments and wealth, so we do not face financial ruin in the event of negative occurrences. Let us use it to our advantage.”


As we plan our financial future there are obstacles that pose risks to our financial well-being and prosperity. Life is full of surprises and the financially intelligent are wise enough to proactively cater for unpleasant surprises and manage risks like accidents, poor health, disability, burglary or death.

The most common way to manage personal risks and reduce the attendant financial losses is Insurance. It is designed to provide a cushion to absorb some of our losses and help us to recover quicker than we could have without their protection. Yet many do not have adequate insurance protection. Some consider it to be morbid and a demonstration of insufficient faith in God. However, insurance is not just about preparing for death. Others have a fundamental distrust of insurance companies due to countless occasions when the latter have not met their contractual obligations to the insured but instead left claims unpaid. Since we do not want to be accused of throwing away the proverbial baby with the bath water, we should buy suitable insurance products from credible insurance companies and do our own part by paying our premiums as and when due.

Non-Life products cover perils like accidents, fire, burglary, flood etc. Many business owners would have recovered faster from road accidents if they had adequate ‘goods in transit” insurance cover. If the landlord insures the house and tenants buy ‘householders insurance’’ to covers the contents, both of them would recover faster in the case of a fire or thunderstorm.

The Federal Government has made Health Insurance compulsory for all eligible salary earners, but that excludes millions of other Nigerians who are yet to benefit from the scheme. Unexpected health complications have a double negative effect – first they drain us financially and then prevent us from going back to work to earn more money, resulting in devastating financial consequences. When this happens some people would blame destiny, but destiny could have been helped with health insurance to provide quicker, more robust medical attention that would have resulted in fuller and faster recovery.

Many Investment products have a Life Insurance component. For instance, a Children’s Education Product bought from a Bank may pay out only the amount contributed for a child’s education to the child if the parent dies before the product lifecycle is completed. However, an education product from an Insurer would pay the Total Product Face Value to the child (irrespective of amount contributed by parent) because the Insurance product carries a Life Insurance component. So if the parent dies, at least the child would not need to worry about financing his education. Some retirees under the Contributory Scheme are now collecting all the proceeds of their Retirement Savings Accounts (RSA) from their PFAs and using it to buy Insurance Annuities. This is wise because the PFA would only disburse the total amount in the RSA (contributions and income earned) to the retiree. So if the retiree outlives the money, the PFA cannot help him. However, an Insurance Annuity is committed to the retiree throughout his life.

Credit Protection Policies are used to protect a property bought with a loan. So that if either due to disability or death a borrower is unable to complete repayment of the loan, the insurance company would pay the balance to the Lender so the Borrower/ Dependents would not lose the property.

Life insurance products are either term or whole life annuities. Term products are for a specified periods e.g. 25 years (but carry a provision to pay full product face value to the beneficiaries in case the insured dies, irrespective of amount contributed); whilst the whole life annuities only pay upon death of the insured. Term products are an additional way of saving towards retirement (due to the long tenure), whilst at the same time providing a financial cushion for one’s dependents in the event of one’s death. By the time the insured is collecting the proceeds of the Term Insurance, his dependents should have matured enough to cater for themselves financially and so would no longer need insurance protection.

Insurance investment products however, do not generate high returns on investment (ROI) simply because of the additional Life risks that the Insurer has to bear. Therefore, in order to get optimum ROI from our Investment Portfolio, only the vital Insurance products should be purchased.

Insurance helps protect our investments and wealth, so we do not face financial ruin in the event of negative occurrences. Let us use it to our advantage. Happy investing

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L.A. Consult Ltd.