A time of economic recession is often tough time because of paucity of funds. Recession is characterised by low economic activities which results in slow circulation of money. Therefore, one of the best ways to survive a recession is being mindful of how the little money available is spent with a view to stretching it for as long as possible. Here are six ways by which your naira can be made to last longer.
Plan your spending
As a high school student with limited resources, I devised a strategy to ensure that I was not stuck at any point during the month despite the littleness of my allowance. What I did was to divide whatever allowance I had into four and spent a quarter per week. If I exhausted the portion for a week before the week ran out, I would not touch the portion for another week; I would have to endure till the following week. By deploying this strategy, I was able to stretch my allowance.
I have found out that this strategy works for anyone who will adopt it and is even more applicable in a recession. So, to stretch your naira, plan your spending and refrain from exceeding the allotment for a week to guard against being stranded at any point.
Added to this is the need to have a budget. Although many Nigerians are averse to budgeting probably because of the not so good example we get from our country, it is still a very important tool for staying solvent. Once the income is known, the expenditure should be charted with every kobo accounted for. Doing this will prevent putting money in unnecessary and unplanned activities.
Track your spending
Louis V. Gerstner, former IBM chairman, counsels that one should not expect what one is unwilling to inspect. Although this advice is primarily meant for company executives and other leaders, it also comes handy in money management. It is good to plan one’s finances. But planning without tracking will not deliver the expected outcome. Going back constantly to the budget to find out the level of compliance is very important. The rich remain rich because they never stop tracking their money; they want to know where their resources are going with the attendant benefits. It is a strategy that could be deployed to one’s benefit. Tracking expenditure will save one from embarking on impulsive purchases that can leave one high and dry.
Buy in bulk
For as much as it is possible, it pays to buy in bulk because doing so confers some advantages on the buyer. What to do is to source for shops that give discounts for bulk purchase as well as those that are doing clearance sales or promos and buy from them. The money saved from this could be put to other uses.
Buying in bulk also guarantees that the materials bought in bulk would be available for a length of time. It could be unsettling to find out that certain items needed have been exhausted when finances have run low. Bulk purchase is a way out of that situation.
Go about with less cash and no card
The undoing of many of us is impulse buying. We buy things we don’t need sometimes because of the momentary appeal they hold for us. But doing that puts us in trouble later. We also travel the route of buying what we don’t need because we don’t want to offend the vendors. But since one cannot give what one does not have, going about with just the needed cash and keeping the debit card safely at home will keep one from financial harm’s way.
Do less of cash transfer
As convenient as cash transfer is, it comes at a cost. While this may not always be possible, for as much as it is possible make cash payment or issue cheques and save yourself from the commission you have to pay for electronic cash transfer. Although the money paid is sometimes negligible, the word of Richard Whatley, former Archbishop of Dublin that “If you lose an hour in the morning, you will spend all day looking for it” could be applied to money management. If you lose a couple of N165 to electronic money transfer, you will spend the rest of the month looking for it.
Save loose change
It is customary of many of us to leave our loose change with the shop or fuel attendant. Generosity is a virtue, no doubt but if the loose change that is left uncollected is tracked, it could amount to a sizeable amount overtime. So, collect your loose change and keep, you never know when you are going to need it.