Anthony and his sister, Joyce were passing by a fashion store where attractive clothings were on display. Sadly, their excitement was cut short by a debit alert of card maintenance fee and a gloomy reminder of their reality – red account balance as they barely have any savings or investment.
It is no hidden fact that individuals, businesses and even government agencies are reeling from the negative effects of the unforeseen COVID-19 pandemic.
Fear, anxiety and uncertainty became the new norm as governments worldwide had to make the difficult decision to lock down their countries and restrict movements both locally and abroad.
While still trying to deal with the numerous rising cases and deaths around the world, companies desperately sought a way to stay afloat in this imminent crisis by slashing salaries and laying off workers given the now stifled revenue streams.
For a country like Nigeria, which was yet to fully recover from the 2016 recession, coupled with the already high poverty, unemployment and inflation levels to mention a few, many Nigerians have been relegated to greater financial difficulties and distress with no foreseeable signs of definite hope.
Yet, surprisingly in the midst of this severe crisis, quite a number of famous persons have been trending for their luxurious lifestyles.
Read also: ‘Fashion industry needs to position for global scale, meet demand for sustainable growth’
Three months ago, by the end of May, the internet was on fire about the newly acquired mansion in Banana Island Lagos of popular Nigerian musician, Davido, worth $1.5 million (over N400 million).
More recently, just last week, news was everywhere about the 3 Ferrari Portofino cars that famous billionaire businessman, Femi Otedola bought for his three daughters, DJ Cuppy, Temi and Tolani Otedola.
A Ferrari Portofino is said to be worth over $200,000. The recent BusinessDay weekender edition estimates the three Ferrari cars to be worth N386 million.
Also, just last weekend, on September 19, the media mogul, Linda Ikeji spent a fortune buying a 2020 Range Rover Autobiography, 85 shoes and 35 designer bags to mark her 40th birthday celebration.
Well, how much is too much? While some term this as extravagance, everyone is entitled to their choice of lifestyle particularly if they can afford it.
Although a larger proportion of Nigerians are poor while relatively fewer persons are wealthy, everyone, including the richest Nigerian, Dangote (with net worth of $9.9 billion according to Forbes) has been affected by the COVID-19 pandemic in one way or the other.
So, the big question here is, how do we bridge this gap and navigate these trying times to be relatively better off and ensure financial security irrespective of economic and social crisis?
On a regular crisis-free day, one could argue that purchasing products that are valued in dollars can be much cheaper than otherwise.
However, in the current global crisis, dollar funds are tied down due to unstable exchange rates and to prevent domestic currencies from losing its value. So, relying on dollar-naira valuation is quite limited.
This comes without the saying that saving during this pandemic is not worth it, rather money should be wisely invested as investment appreciates in value over time.
So, what viable business opportunities exist that are not money-draining, you may ask.
Mutual funds
This is a collection of funds pooled in multiple assets including stocks, bonds and other securities. It is one of the latest trending games in town as it is less cost- intensive and one can start investing with as little as N1,000-N5000.
Reliable and proven fund managers include Stanbic IBTC Nigerian equity fund, FBN money market fund of First bank and Legacy Money Market Fund (LMMF) of the First City Asset Management Limited among others.
Land/Real Estate
This is the booming sector in recent times. Most Nigerians are not aware of the Real Estate Investment Trusts (REITs) which is a collective investment scheme that pools money to invest in real estate and mortgages.
Like, mutual funds, REITs is regulated by the Securities and Exchange Commission (SEC).
Value can be gained on real estate by renting a part or all of the purchased property using the 2% rule according to Bigger Pockets which states that monthly rent should be at least 2% higher than the purchase price.
Cryptocurrency (Bitcoin, Ethereum)
This is another viable and thriving ventures that involve a bit more money but is a highly profitable opportunity.
2017 was the year that cryptocurrency really skyrocketed as its market value grew from $21bn in March 2017 to $454bn in September 2020.
Bitcoin for one is valued at about N4.07 million (or $10,510) and Ethereum at N132,072 (or $340.8).
Here, there is no minimum investment amount as this depends on the investment platform. For instance, on coinbase, bitcoin can be bought for $2.
The New Gold Exchange Traded Funds (ETF)
Also, gold has the reputation of being a safe haven especially in times of crisis. The new gold ETF is an asset in itself which can be traded and is managed by Vetiva Securities.
It is listed on the Nigerian Stock Exchange and saw almost 20 percent increase between March and May during the global pandemic-induced crisis.
Experts say that to protect oneself from any form of crisis and secure the future, it is advisable to invest in not just one asset but in multiple assets.
So, if one is able to cultivate this investment lifestyle no matter how late it seems to start, it will go a long way to positively impact not just you but will help live a substantial legacy for your family and even generations to come.
Short Bio
Favour Olarewaju is an Economics and Markets Analyst at BusinessDay Media Nigeria. In addition to writing content surrounding economic and financial issues, she is a researcher and pre-doctoral research fellow. She is also a masters’ degree holder from Covenant University, Ota, Nigeria. She is an active member of a charity organization known as Clothe A Person and strongly believes in making the world a better place by proffering solutions to societal problems through research analysis.
