People read my blog posts on personal finance and listen to my smooth talk on how I make my money work for me. But very few people go beyond thinking, "This Michael is good. He knows a lot."
It's nice to be thought of as such. But if that was the aim of those posts, I wouldn't go that deep with figures and my personal stories.
I don't just want you to read my personal finance posts and feel good about the author. No. My aim is to make you do something, to take actions, to read more and google for the accuracy of my recommendations, and ultimately, to move yourself forward financially.
If all your money is in a savings account, then there's a problem. Even if you work full-time for Chevron and part-time for Mobil, and earn my 2 years salary in a month; you've still got a problem. A savings account is meant to house money you intend to use in less than 3 months time. Any money you don't plan touching in 6 months shouldn't be in a savings account.
If you've seen my picture in my About Me page and you were like, "Hey, this Mike guy is probably my age mate!", and you don't have a Mutual Fund account or a Stock brokerage account, and you earn monthly income; then you've got a problem. It's time you begin to take investing seriously.
If you've been reading my blog and you've never considered investing; then we've both got a problem. Maybe I need to review my style of writing.
Investing is as much about wealth preservation as it is about wealth generation. The only way you can be sure that the N1 million you have today will at least have the same value 1,2 or 5 years from now is by -- Investing.
Whatever you put in a savings account is degrading in value year after year. Inflation is eating terribly into it. It's like storing your jewelry in a box filled with water, sure they'll still be there 5 years later, but they would have corroded. That's what savings account does to your money.
Then there are some of us who have fallen in love with Cooperatives or Ajo. Like my dad, he talks so passionately about it that I almost believed interest was being paid on money contributed. I know the camaraderie helps a lot of people develop the savings habit, which is a very good thing. But I must say the truth, let it be only a transition point and not a destination. You need to move on to the big league.
Finally, there are those who think investing is too risky and are not willing to risk their hard earned money. It's a reasonable fear, perhaps, the most reasonable fear I know of. You can always start very small. Just make sure you start.
I started my investing journey with a N10,000 Mutual fund with ARM. It was the minimum allowed and I found it as the convenient amount I could put in it without losing my sleep. And after some months I felt more at ease investing in a Mutual Fund. I still invest N10,000 monthly in that Mutual Fund.
Now, I have a Money Market Fund and a Stock brokerage account too. But I started very small, with very little sum of money, and as my knowledge and experience grew, I put in more money. I never have beyond 2 months living expense in my savings account, and besides my emergency fund account with Diamond Bank, all my life savings are in various financial investments. They have not doubled or made me crazy money, but they are working extremely hard for me and way better than a savings account.
And that's what investing is all about -- making your money work hard for you, just like you did for it. You are like a farmer; you've worked, tilled and sown with sweat, you eat some of the produce and replant the rest. Some people eat everything and keep starting from the scratch all the time. Those who put everything in a savings account, are simple scattering seeds on a field. While those who invest, are carefully replanting those seeds.