Career is about more than making money. Yet money helps to remove many of life’s inconveniences. That is why it remains strange that someone can attend a university, graduate and enter the workforce without receiving any practical education on personal finance and wealth management.
Universities teach corporate finance and equip people to make money for companies by optimizing the factors of production. But they rarely teach graduates how to manage, preserve and grow their own earnings. For me, that is a major failure of the modern education system.
As a young banker, I quickly understood one important principle: how much you earn is only a small part of your journey towards financial independence. Reaching that destination requires moving from a static phase to a dynamic phase, as we learned in mechanics in physics. In other words, you must take action, and that action must begin with a plan.
During my first month as a banker, I developed what I called the 45-20-20-15 Strategy, allocating my wages among different “catalysts for success”:
- 45% for myself and my family: housing, clothing, transportation and related needs.
- 20% for personal development: professional certifications, education and new capabilities.
- 20% for other obligations and opportunities.
- 15% for investments: dividend-paying stocks and other investable assets.
Using simple calculus and regression, I estimated that by consistently investing 15% of my income, every five years of work could generate the equivalent of two additional years of wages, assuming constant inflation and currency values.
My strategy has changed over the years because my needs and responsibilities have evolved. The central message is simple: earning money is important, but understanding how markets work, and how to invest wisely, is indispensable.
We created Tekedia Nigeria Capital Market Masterclass to provide practical guidance on investing, portfolio management, financial products, market technology and much more.
Across 16 comprehensive modules, you will master the core physics of capital and understand the DNA of Nigeria’s capital market, how it works, how value is created and how you can participate intelligently. The programme begins Oct 5 for eight weeks.
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