Treasury bills and Mutual funds: all you need to know.
What thoughts pop into your head when a financial talk is going on? Do you still belong to the school of thought that treats financial advice flippantly, “I will bother about my finances much later when I am much older? Right now, I just want to … ‘have a hot girl summer’?”
Baby girl! You are balling at the risk of your financial security, and that’s a wrong move. The times we are in now, it’s costly not to be literate financially. We know it’s a ‘hot girl summer’, but we also want you to understand that you can be the girl that causes heads to swivel when you walk into a room, PLUS the girl that secures the bag. Nobody is asking you to choose. We don’t want you to choose, we want you to be BOTH. Understood?
A lot of times, women don’t pay much attention to building their finances until much later when the time has come to talk about pensions. Why wait till that time. Why not work towards that life you have envisioned right now and if you haven’t, well stop what you are doing for a minute, close your eyes and envision what the next five, ten years should look like.
If what you envision, is to be able to do whatever in the heavens you want to do without having to break the bank then start laying down the foundation today. You can’t possibly be a baby girl for life when you are using all your income to pay bills. Yeah, girl jot that down.
One thing that should get your mind working and taking financial literacy serious is to ensure that you don’t relax on daddy’s money. If your parents have secured you financially, be grateful but don’t slacken because there’s always the tendency to waste money you did not work for. To avoid such occurrence, empower yourself financially, so you can multiply that which is already in the bag.
Also, you may not be working right now, and instead of waiting till that time when you will be on active income, we encourage you to stay a step ahead. Get learning on how to manage your finances, so that when the time comes for you to make financial choices, you won’t make mistakes, as we see it happen regularly; fall into the nuances of Ponzi schemes.
Secrets to securing the bag
Don’t make the mistake of tying your income to one source only. The guaranteed route to financial security is a diversified income stream. This is why you should not be satisfied with that one business or job even if you are on a competitive salary scale.
The thing about paid employment is that you are never really secure. Your monthly paycheck is subject to various factors and at the discretion of another human. There could be an economic crash, mergers, downsizing, and your company can layout the following cards which could be to choose between being laid off and a slashed paycheck? If they are kind enough but most times they just lay off. So, you can walk into the office one morning and find a disengagement letter at your desk.
No employee is indispensable, no matter how good they are and when it happens that your organization asks you to go, your pilling bills won’t understand. Did I hear you say, “well that’s why I have always wanted to get a government job, there’s security”? You are right but still, your paycheck can only take you so far, and you can’t possibly have the life you dream of if you depend on a monthly income.
Now that I have stressed how important a diversified income stream is to your life, I will show how you can build one. It certainly is not a day’s job, hence the importance of starting early.
The secrets to rising above your monthly paycheck
Use your gifts/skills
These are two different things but for this piece, I will classify them as one, and maybe some other time I will expound on the differences. What is that thing or those things, ’cause they could be more than one that you are regularly consulted over and appreciated for? You will have your eureka moment when you discover what it is that:
- You enjoy doing
- Gets you noticed
- You can get paid for
No one was born without a gift, we all have it, look around you. You can get the friends within your circle to help you find out what it is you do that is unique to you. What does your family compliment you on? What’s that thing or those things that your girlfriends come to you for? “If not you Sade, I don’t know who else can get this job done for me”. Once you know what that gift is, package it and put a price tag. Spread the word, ” I can get this done but not for free.”
Take this seriously, and you will spring up a business in no time, which may eventually exceed your monthly paycheck. Freedom is when you forget what day of the month is payday.
A man’s gift opens doors for him, and brings him before great men - Proverbs 18:16
Side hustles or part-time jobs if you please
Do not depend on a monthly paycheck, is not me saying, don’t be an employee. Most times, you will have to be an employee to enable you to raise the needed capital to start your business. While your business is still in the works, you can look for another job you can do, on a part-time basis to supplement your primary income stream. This is made much more possible, thanks to online jobs.
“If you don’t find a way to make money while you sleep, you will work until you die.”Warren Buffet
Invest your money. Don’t spend your income buying liabilities that will wear out and add no tangible value. Money from your monthly paycheck or money earned through your skills/gifts should be divested into assets that will yield profit within a short or long time frame.
Take a cue from Jayz whose primary source of income is his music (gift), his secondary source of income, endorsements, and brand promotions. Yet, what earned him the billionaire status is his investments in real estates. Now can you pause a minute? We know it’s not a Sunday, but we want to take you to church. Turn your bibles to the book of Ecclesiastes 11-6.
“In the morning sow thy seed, and in the evening withhold not thine hand: for thou knowest not whether shall prosper, either this or that, or whether they both shall be alike good”.Ecclesiastes 11-6
I know I have got your minds working right now, and you are probably thinking, “I don’t have money for real estates, I will have to save years for that”. There are investments you can engage in without having to break the bank.
Financial investments – secrets to securing the bag
Financial investing means that an individual commits money to a financial asset or security such as a stock or bond, in hopes of receiving even more money over time, through interest. Investing is what I term, earning money that you don’t really work for. There are factors to consider before deciding what types of financial investments to engage in. such as:
- Liquidity: How fast can you pull out your money when you need it?
- Roi: Roi – Return on investment. What dividends rates are you expecting?
- Starting capital: How much do you need to start off? Mutual funds require as low as 2000 naira to get you started, unlike treasury bills which require a minimum of a hundred thousand to get you started on treasury bills.
- Risk: What are the downsides to these investments?
When you’re looking for a safe way to invest your money, it doesn’t get any more solid than government-backed securities.
Treasury bills are short-term sovereign debt securities maturing in one year or less. They are sold at a discount and redeemed at par. These bills are by nature, the most liquid money market securities and are backed by the guarantee of the Federal Government of a nation.
The Federal Government of Nigeria, through the Central Bank of Nigeria, issues Nigerian Treasury Bills to provide short-term funding for government budget deficit. The treasury bills are usually issued through a competitive bidding process and can be gotten on your behalf through your financial organization.
A mutual fund is an investment that pools money from many investors and invests the money in securities such as stocks, bonds, and short-term debt.
Why Mutual funds?
- They are professionally managed by fund managers.
- Mutual funds typically invest in a range of companies and industries. This helps to lower your risk if one company fails.
- Most mutual funds set a relatively low amount for initial investment and subsequent purchases.
- Mutual fund investors can easily redeem their shares at any time.
Financial expert, Tomie Balogun explains even better the benefits of investing in mutual funds and treasury bills.