My Money Mistake is a weekly PiggyVest series that explores the worst money mistakes real Nigerians have made, and the lessons they learnt from it.
For the first-ever episode of My Money Mistake, we spoke to a 28-year-old creative who lost over ₦900,000 in investments between 2018 and 2021. After deciding to try investments as a means to earn residual income, he found himself losing money no matter what he did.
What was your first-ever investment?
Does Ultimate Cycler count?
Did it count to you?
Yes, it did. It was this scheme where you paid a member ₦12,500 in hopes of getting matched with four people so you can earn ₦50,000. It was the rave in 2018 and all my friends were doing it. That, and two other ponzi schemes (whose names I can’t remember) were the hype. I invested a total of ₦40,000.
Omo. Did you make a profit?
Not a single dime. While others were cashing out, the moment I paid to the people I was paired with, things went south. The site stopped working, I couldn’t get paired with anyone and I lost all my money. This was a serious hit for me ‘cause I was a student trying to earn passive income with no knowledge on how to go about it.
Did you do any research?
Back then, my idea of research was asking my friends. In fact, I felt I just needed to keep trying my luck and something would click. That’s how I found myself paying strangers on Instagram to trade for me.
Ehn? What year was this?
2019. A friend introduced me to some people on Instagram who presented themselves as “traders.” I paid them ₦15,000 because they claimed to give 300% ROI in 24 hours.
Yup. So, I texted them for my ₦45,000 the following day and they started asking for a ₦5,000 registration fee.
Registration for what?
I don’t know. I asked to speak to their manager, and he was talking about how they needed the ₦5,000 to get my ₦45,000 out of the trade. The whole thing turned out to be a scam.
It’s fine. That didn’t stop me, though. I kept saving a large chunk of my allowance and spare cash so I could “invest” early in the next wave of schemes. An opportunity presented itself when I heard about Loom.
Loom, as in the ponzi scheme Loom?
Yes. The same one. I had already put so much pressure on myself to make money. I wasn’t going to commit a crime to achieve this, so ponzi schemes were my surest bet.
So, how did you get into Loom?
In 2019, after the whole Instagram traders thing, a friend of mine told me about it. She said once I joined their Whatsapp and Telegram group chats, two people would be paired to pay me ₦20,000 each. All I had to do was pay money to whoever the group admin paired me with and wait for their cycle to complete.
Everyone belonged to a cycle where they had to pay an admin-appointed person. There were different levels to this and the lower levels had to pay the higher levels before earning money themselves.
Did you at least make some money from this?
Even five naira, I didn’t touch. I brought two people in and they made my people pay someone else.
Now that I think about it, those people could have just been friends who were using other people to pay themselves.
The whole thing was so discouraging, but I needed money. I needed money so badly, I paid to attend a forex training conference. This was also in 2019. There, I saw a lot of people making money from trading and decided to try my luck.
How did your first trade go?
I invested ₦200,000 and told myself that I needed to double or triple the amount by month’s end.
So you gave yourself a 30-day deadline?
I had to. That didn’t stop me from making so many trading mistakes, though. I would rush into a trade without observing the market. There was no strategy on my end, just vibes. Needless to say, I lost everything in less than a week.
That’s tragic. How did you cope with the loss?
By getting someone to trade for me.
You don’t quit, do you?
It wasn’t an option for me. I was in too deep to quit. The money I had lost was a lot, and the thought that I could recover everything and more kept me going. I was so hopeful about everything becoming right in a single trade that I hired someone to trade for me.
The thought that maybe my general lack of trading experience was the reason I kept losing money was how I pushed further.
What did the trading arrangement with this new guy look like?
First, I had to pay a one-time, non-refundable subscription fee of ₦40,000 to him. Then, I had to wait for him to give me a signal to trade. He assured me that the ₦40,000 was a life-time access to signals from him.
Signal as in “On your mark, get set, go?”
LMAO. So, in trading, signals are cues for when to invest and what to invest in. So, I was paying him to teach me how to trade and to give me signals.
Did you learn anything useful from him?
Not really. His method of teaching was sending me tutorials online and telling me to watch the market. The signals he gave to me were always wrong. I lost $300 trading with him.
How did you even find this person?
I found his page. He was a big boy in Port Harcourt with several houses and a group he mentored. He appeared to be a big deal among other traders.
How did you verify his wealth or knowledge?
I took his word for it. He may not have been any of the things he claimed to be but, see, I was very desperate. It was my final year in school and I was under a lot of pressure. Self-imposed pressure. In my head, the question “What next?” kept popping up. I needed a win to show for all the money I had lost.
This was the logic I held on to that made me decide to leave the trader guy and do things on my own. Again, I had no proper knowledge of the market, but I just kept pumping money into trades.
As a student, where did you get the money to finance these things?
I had an allowance, I was working a side job and a lot of people owed me money. Even with these streams of income, I was still very broke. That’s why I kept investing with every little money I had; I just needed to make more.
Was there a point when you felt you’d had enough?
Yes. After leaving the trader guy, I tried things on my own and everything blew [losing all the money in your account over a trade] at least five times. In 2020, I decided to invest with a company. Their model was to collect a certain amount from people and pay them back a 14% ROI monthly.
How much did you invest?
I invested ₦100,000 and for six months, they paid.
Wow! They paid?
Yes. My luck was finally changing. That was until I took all the profit I made, the capital, plus some extra money and reinvested. After that, the company went bankrupt and I lost everything. Again.
Bro. Where is the company now?
At first they were reassuring us, then they went MIA. After that, I quit trying investments altogether. That was early 2021.
For the investments you did, were there any red flags you ignored?
I’m sure most of them had red flags I ignored. For the ponzi schemes, I knew so many people making money and I needed to be one of those people. I knew people who lost, too, but when you’re desperate, you ignore these things. You want to believe your case will be different.
How did these money mistakes affect your finances?
I could never get anything done for myself. For three years, I wore the same shirts, shoes and clothes. Let me put things in perspective: I don’t have to pay rent and I work a good job and yet, I’m never able to get things done. I invested all the money I made and only kept some for food and data. The person I am today is someone slowly recovering from a life of financial woes.
What was your biggest lesson from these mistakes you made?
Research. I’d advise that anyone looking to invest do a ton of proper research. Don’t just take anyone’s word for it; make some findings of your own. For me, investment felt like gambling because I kept increasing the stakes hoping for a better payout. That just never happened for me.
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