2021 has been a wild financial ride for Nigerians. What with the plethora of loan apps, government loans, grants, grant scams, struggling businesses, increase in the cost of nearly everything in the market, and the fluctuating (and mostly diminishing) value of the naira against the dollar, finances have truly been a wild ride for Nigerians this year.
It is time to regroup, take stock, and get set for a fresh start come 2022, and the time to do that is now. You might be tempted to put this off until after the New Year celebrations, but if you want to finish this year strong, you need to deal with your finances now.
Here are some ways you can end 2021 financially strong:
- Make a budget for your holiday expenses
You don’t need to clear your bank account to enjoy Christmas and New Year. Make a list of what you need to buy, for who and what for, and stick with it. Overspending during the holidays does not set you up for a strong finish or a strong start in the new year.
- Review your financial goals
What financial goals did you set this year? How did they help you make better/worse financial decisions? Review those goals as you work towards setting new ones for 2022; and remember, your goals need to be SMART: Specific, Measurable, Achievable, Realistic, and Timely.
- Check your spending
Do you know how you spent your money this year? Was it on things you absolutely needed at the time, or could you have waited a bit? It is not uncommon to earn money and spend it on things that could have waited, like coaching and courses. Make a note of how you spent your money and tighten your budget where you need to.
- Assess your debt
How much debt do you have? What is your repayment strategy? Why are you in debt? Considering these things will help you see what you need to see and work on before creating a financial plan for 2022.
- Create a savings plan for 2022
This also includes creating an investment plan for 2022. How much you’re going to save every month, how you are going to save (automatic debits or manual savings), what you are saving for, how much you will invest every month, and what investment options you are looking at – with returns – should be in this plan. Be specific and realistic. This means looking at your savings and investment plan for 2021 to make an informed decision about what you plan to do in 2022.
- Have a healthcare plan
The coronavirus pandemic has made it imperative that you take a good look at your health insurance options, and get one. Consider your options and invest in one that you are comfortable with, in terms of your budget and healthcare coverage.
- Check your emergency fund
Emergency funds have come in handy in the past year, showing that having one is one of the most important financial decisions one can make. If you don’t have one, now is a good time to set one up. If you have one, check it to see how much you have there and, if necessary, top it up. It is recommended that you have 3 – 6 months’ worth of expenses in your emergency fund, which should be in an account you can easily access.
Start taking action now to finish out 2021 on a strong financial note, with enough momentum to push you into a financially successful 2022.
