Editor’s note: Ken Doghudje, the financial expert contributing to Naij.com, warns Nigerians against falling for faulty and ineffective wealth creation strategies, offering three sure-fire plans that will ensure success.
Success in wealth creation requires a strategy based on a sound formula to make it a reality. Wealth cannot be gotten by wishing, hoping or over-spiritualizing. It entails taking steps to realize it. You have got to study, plan, strategise, brainstorm, consult and execute a series of steps and maneuvers in order to build wealth.
Having the wrong wealth creation strategy might be the limiting factor in your quest for wealth. Permit me to expose you to some of the wrong strategies people are hoping will lead them to wealth acquisition.
What you should not fall for
Do not expect to build wealth if you believe in winning the lottery as your formula for wealth creation. Spending loads of time and money gambling, trying to beat the odds in casinos and pool houses will get you nowhere. This is because very few people ever accomplish this. Money gotten this way will be easily wasted away because this practice does not encourage one to value money. The cycle of gambling will continue till you eventually lose all the gains made previously.
Then there are those who see political office as their ticket to wealth. Governance to them is not an avenue to serve others, rather it is the best means to serve and enrich themselves. There are several flaws with this strategy, namely, the legal consequences if one is caught, and the fact that many African countries have seen the evils corruption brings and are actively engaged in its eradication. The national cake is meant to be distributed as evenly as possible and not looted away by government officials.
It is also foolhardy to make crime your wealth creation strategy. The fact is that many people who will do anything to make money in our society. They are desperate believing the end justifies the means. This train of thought is common among today’s youth especially when they are exposed to criminals being extolled, praised and eulogized. Crime may pay in the short term, but in the long run comes with devastating consequences. There are many genuine ways to create wealth that one need not be engaged in criminal acts.
Investing in ge-rich-quick schemes is another faulty wealth creation strategy. People who have worked hard to earn the little they have get enticed by schemes where they can make huge returns overnight. If it sounds too good to be true it probably is. There is no such thing as a get-rich-quick wealth creation strategy. Wealth is built gradually over a substantial period of time.
Another wealth creation strategy that is fraught with danger is putting your resources in the hands of people that are competent to manage your money, without taking time to understand what they will do with it. A lot of people want to delegate wealth creation to somebody else to go through the stress on their behalf. This is unacceptable. Stories abound of people absconding with their client’s investment funds because they did not take time to know more. Don’t invest in what you don’t know anything about.
Finally, it is extremely impractical to make your children your wealth creation strategy. Don’t be tempted into thinking that when they grow up they would succeed financially and take care of all your financial needs. Don’t make the mistake of thinking your kids will always be there at your beck and call. It is wrong to add your needs on top of theirs when they also have things they need to accomplish. You are supposed to provide for them and not the other way around. What if they decide not to provide for you? What if they don’t succeed financially?
Tested and approved
There are several proven wealth creation strategies that you could focus on if you desire to create great wealth and fortune.
1) Investing in a financial education. This, according to many financial experts is the investment that yields the most interest. You ultimately become what you study. That’s why those who study the law and medicine become lawyers and doctors respectively, while those who study money become financiers and money experts amassing wealth
You can never control what you don’t understand. A sound financial education will open your eyes to the best ways to create wealth. You must apply what you have learned to your situation and circumstances, though.
2) Developing multiple streams of income is an extremely sound wealth creation strategy. This presupposes that you actively seek for ways to earn income from two or more different sources, for example a job and a business on the side. You could use your spare time and weekends to generate a second and even a third income where possible. Depending only on what you make on the job will lead to lack and poverty as it is never enough. Get right into looking to build multiple streams of income as soon as possible.
3) Cash flow investment strategy. Cash is king. In order to build wealth one should focus on investing in business activities that generate a positive cash flow on a daily, weekly or monthly basis. There are many small businesses out there that can provide regular earnings at low cost. Constant income that comes in, no matter how small, on a consistent basis will grow to a reasonable income over a long period of time.
Wealth creation does not happen overnight; with the right strategy in place one can create wealth and fortune within the medium to long term. The strategies highlighted above are tested and trusted, and sure to put those who apply them on the path to wealth. They are by no means the only ones available, but you cannot go wrong if you deploy them.
Start now, start right away to work with these proven strategies and see your wealth creation efforts on track. It is possible to build wealth in Nigeria.
Kenneth Doghudje is currently the managing director of GfK RT Nigeria, the West-African subsidiary of the fifth largest market research agency in the world. He promotes Moneytalk and creates money lessons videos on his Youtube channel. Reach out to him on email@example.com, or via Twitter @moneytalkng.
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