2023 has been a year of sustained financial pain for many Nigerians. It began with a frenzied naira shortage. It is ending with the harsh effects of the petrol subsidy removal and the Central Bank’s decision to float the naira.
Inflation has continued to rise, the cost of living has tripled, and Nigerians have had no choice but to sit back and witness the deterioration of their spending power. In September, the naira hit a historic low compared to the dollar in the black market.
“I planned to move to a two-bedroom apartment in Lekki this year so that I could leave Alapere and have more space to do my business,” Tare*, a Lagos-based fashion designer, told PiggyVest. “My plan was to use either the living room or one of the bedrooms as my workshop, and hopefully my new location would help me network better. It’s almost 2024. I’m still in Alapere. I had a budget of ₦2.5m, but apparently, if you don’t have at least ₦4m you can’t live in Lekki. I’ve given up on that dream for now.”
Asked about her saving habits, Chinenye*, a banker living in Port Harcourt, replied, “This year, I didn’t save as diligently as I did last year. Everything is now expensive, abeg. I used to save immediately when my salary came in, but now I save after paying all my bills. That’s if I save at all.”
As 2023 draws to an end and the festivities begin, you may feel disappointed at your inability to celebrate like you’ve been used to or frustrated that you couldn’t meet your saving goals for the year. But as they say on social media, “Na who get money dey save.”
Indeed, you can’t give what you don’t have—but there are small changes you can make if you want to optimise your income, so that you can set money aside for rainy days.
Below, we share eight tips to help you save better in the coming year, without making huge—and likely unsustainable—lifestyle changes.
1. Automate your savings
Many people struggle with saving money, but automation makes this a recurring, stress-free process that also helps you build a strong saving culture. PiggyVest users can testify to how easy the Autosave feature makes the saving process.
For non-PiggyVest users, visit the PiggyVest website or download the PiggyVest mobile app and create a free account. To automate your savings, go to Savings→Piggybank and toggle on ‘Enable AutoSave’. In your AutoSave settings, you can choose how frequently you save, by clicking daily, weekly or monthly. You can also choose your primary source of funds and your preferred day and time.
2. Build your emergency funds
Emergency funds are cash reserves put away for, you guessed it, emergencies. Typically, an emergency fund should be the equivalent of three to six months of income. So if you earn ₦100,000, your emergency funds should be about ₦300,000 to ₦600,000.
In the current economic climate, this might be unrealistic or tough to achieve, but it is important that everyone has some form of emergency cash they can fall back on in unforeseen situations like a health scare or job loss. Even if you have no other saving goals, growing your emergency funds is enough motivation to start saving today.
3. Create multiple saving goals
According to the 2023 PiggyVest Savings Report, rent, personal education and japa, are the top three goals Nigerians are saving towards. Your goals may differ, but they can only be realised when you save towards them.
If you’re looking to start your goal-oriented savings journey, you should set up Targets on PiggyVest. Targets are the easiest way to save towards multiple goals at the same time, with as much flexibility as you’d like. You can save publicly, privately, individually or in groups. Categorising your goals this way, instead of lumping them up together helps you track your progress without stress.
4. Establish a budget
If you’re looking to save more in 2024, you should NOT be spending money before budgeting. And creating a budget does not have to be hard work. If you’re struggling with this, consider the 50 30 20 rule: Break down your income into needs (50% of your income), wants (30% of your income) and savings (20% of your income). This is the simplest way to automatically ensure that you have allotted some money for savings, even before your expenses start.
5. Make shopping lists
Your shopping list is a mini-budget. It helps you curb impulse buying, track your expenses, and propels you to hunt down a better deal when you’re about to exceed the price limit for an item.
6. Eat the rice at home
When looking at small changes that can help you save money, consider your eating habits. Do you make your meals at home or do you like your food fast and pricey? To improve your saving habit, you will have to find a newfound appreciation for the “rice at home” your parents constantly reminded you of as a kid.
Sure, cooking is time-consuming, but constantly ordering your meals can set you back financially in ways you’ll not notice until you scrutinise your expenses. If you go to work every day, consider packing yourself a lunch as often as possible. You can expedite this process by meal-prepping on weekends.
7. Terminate unnecessary subscriptions
Avoid forking out more money than you absolutely need to be spending. You don’t need all those streaming platforms or that gym membership you haven’t used in four months. You should also reconsider the apps of fast fashion brands or companies that cause you to spend impulsively.
Comb through your bank statements to find expenses you’ve made in the past months that you could have gone without. Cancel them. Then, unsubscribe from those guilty-pleasure mailing lists to save yourself more money.
8. Track your spending
Your saving and spending habits affect each other. Save more, spend less. Spend less, save more. That’s why tracking your spending is an important step in building better saving habits. This is why PiggyVest has its own spendable, flexible savings wallet, called Flex, where all your interests from other wallets accrue. It allows for free withdrawals in case of emergencies. You can also send money directly to your Flex account.
The best thing about your Flex wallet is that you can allocate money for different purposes using Labels. With Labels, you can categorise your Flex balance into groups, tagging each label accordingly. For example, “Detty December”.
To create a new label, go to Try Labels→New Label, then title your label. Enter the amount you’d like to allocate and Create Label. You can release a Label at any time. As long as you make four withdrawals or fewer than that in a month, you will earn an interest of 8% per annum on this wallet.
