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After Recession What is Next?

Are u prepared for market correction 2 protect your portfolio and even profit from this correction? If you’re not sure, join me Sept 9, at Blumy Guest House,51/53 3rd Avenue, Behind MTN Office, Gwarinpa Estate Abuja, when I’ll share my powerful defensive strategies and demonstrate how you can actually profit from the recovery market and economy.

Plus, I’ll also show you how to:

  • Get the signals that alert you to buy or sell
  • Better time entries and exits
  • Avoid over-hyped stocks and other landmines that can destroy portfolios
  • Use the proven  Investdata Buy & Sell Signal Setup to trade and invest profitably
  • Anticipate whether a stock is likely to beat or miss earnings estimates

This event is filling up quickly so and secure your spot and enjoy 20% discount on all our home pack study materials that will boost your understanding and knowledge to profit from stock market investment.

 

Registration fee is just N1,000 online. CLICK HERE TO REGISTER or at the venue.

Hope to see you there,

Ambrose Omordion

Founder & CRO | Investdata Consulting Ltd

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Performances Support Dividend

Despite the seeming associated risk, equity investment has proven to be the best performing investment window, whether in a bullish or bearish market when compared to other investment options like bonds and fixed income instruments in the money market. Typically, stock returns are derived from capital appreciation, dividends and even bonus issues. Dividends payment have historically accounted for 20 to 40 percent of the average annual stock market returns. A lesser known fact is that reinvested dividends have provided for between 44 to 97 percent of historical stock market returns.

During tough market conditions such as the down market that we are now experiencing, investors should realize that counting their losses will not prevent further losses. They should rather change their investment perception and tag along with the market as it presents itself. Investors should take advantage of the opportunity of low priced equities to position in the market in anticipation of full year earnings of quoted companies in the first quarter of 2017, considering the present high dividend yield of stocks.

For now, there is no expectation of corporate results that will influence prices of stock, but with external forces or information that can drive the nation stock market since the liquidity level remains tight and the government has failed to look into the plight of its citizens that have lost fortunes in the market as a result of deteriorating economic situation. The falling prices of equities on the floor of the exchange has pushed dividend yield of many stocks and some sectors up.

But given the uncertainty of corporate earnings amidst the current economic slowdown, the market is probably showing that the dividend cut which has largely been concentrated on the manufacturing sector would spread over to other industries as well. Investors should be careful as the outlook for dividend growth in general in 2017 is slim, since some of the recent released earnings have revealed how many companies would be next year.

However, if you can achieve at least anything above 8% yield to cover the half rise in inflation you would be able to weather any short-term and long-term weakness in the stock market. This does not mean that I am recommending a huge portion of your long-term portfolio in bonds, which are normally sold to retirees as a ‘safe and reliable source of income.’ You do get a fixed payment every period or so, but the purchasing power of this payment declines over time.

Thus a very good strategy over the long run is to create a diversified portfolio of stocks, that have shown consistency in raising their dividends year after year and which spot an attractive dividend yield for your consideration. Here, it’s necessary for investors to know how the yield is computed whether based on forecast or historical dividend.   Dividend yield is calculated by what have been paid by dividing the latest dividend with the current market price of the company. Higher yield does not guarantee increase in dividend payout.

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Importance of Dividend, Products and Company Size In Equity Investing.

The market has suffered huge losses as it continued its southward trend in the past months and weeks before finding new support level that brought the oscillating trend we saw in the recent weeks. This is an indication that the expected market recovery is underway despite that the companies and market fundamentals that are to influence equity price are still very weak for now but when positive information and improve macroeconomic indices start emanating in the weeks ahead it will support the recovery move.

Increasing unemployment rate, due to high cost funds as a result of high interest rate, high cost of governance, dwindling value of naira as a result of falling oil price, low purchasing power and weak Q3 corporate earnings have affected the market hugely. Also, the government economic blueprint has not given direction yet to guide foreign and local investors decision. The uptrend witnessed in the first trading week of August was attributed to sentiment on low prices of equities as smart money consolidate their positions in some companies. The current high dividend yield and margin of safety should guide discerning investors seeking opportunities to grow their portfolios and build wealth. They should buy quality stocks even as the market decline in the face of expected recovering. Targeting companies with consistent history of dividend payment on quarterly or yearly basis. Research has shown that companies with a policy of consistently increasing dividends have outperformed the market on many occasions. Dividend paying stocks put cash in your pocket and help you to counter inflation.

Unlike earnings, dividends cannot be manipulated or faked; dividends provide continuous feedback on company’s performance. As time passes dividend investors see their income steadily grow. You do not have to wait five to 10 years to determine if the strategy is working.

Reinvested dividends provided a significant portion of the historical equity return; performance in any given year is driven by capital appreciation, but long-term returns are largely the result of reinvested dividends. Good companies grow their investors’ dividends: you expect your employer to give you a raise periodically. Why wouldn’t you expect the same from your investment?

Spending dividends in retirement does not harm your investment. In addition, a good dividend portfolios can be given to your children and grandchildren. A dividend portfolio is relatively cheap to maintain. We strongly advise that dividend paying stocks should have a spot in everyone’s portfolio, especially in a time like this.

Another key factor to successful investment in this kind of market is to invest in companies that are leaders in their business and industry. If the company is key player in its sector then it can raise prices to keep up with inflation but not in every situation. The market leaders can easily raise capital and survive economic downturns considering the nature of their products and services that have no close substitute. These companies are money spinners with healthy cash flows. As an investor you may take a full position in some stocks right now at a better price. There are some good quality stocks around that are immune to market selloff, meaning that after profit taking or free fall of the market, some companies share prices bounce back on the strength of its profitability and earnings.

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Stock Terminologies

Recently, I went for a meeting with a top executive of the company managing my website. After the meeting, I also used the opportunity to see one of the executives who has been my client for the past 9 years and anytime I used some stock terminologies which he will say “Abeg you don start again talk wetin I fit understand.”

So, I had to explain in simple terms that he could understand and easily relate with. So, in today’s blog, we will be looking at some types of stock, what is a bear and bull market etc.

How Many Types Of Stocks Are There?

There are two main types of stocks that investors can own: common stock and preferred stock.

When people talk about stocks they are usually referring to common stocks because, well, they’re common and they are the majority of the stocks issued. Both of these stocks represent ownership in a company but preferred shares normally come with a fixed dividend unlike the common stock, which has variable dividends. People may choose preferred stocks because in the event of liquidation, preferred shareholders are paid off before the common shareholders.

Bull Market

In bull market everything in the economy is going well. Stocks are rising, unemployment is low and the economy is growing.

Bear Market

A bear market also does not last for a set term as it can go on for years. During this period, investors have a hard time picking profitable stocks.

What Is An “Illiquid Market”?

Illiquid defines an asset or security that is not able to sell quickly due to a lack of buyers and sellers in the market. Selling it quickly would result in a loss of profit. A market would be described as illiquid if there is a shortage of interested buyers and little is being traded.

The above were basically the clarification I discussed despite the fact that he has been a longtime investor. Although it may look ordinary to those who already understand but I believe that it will go a long way to help you have a better understanding of stock market reports and analysis

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Diversify Your Portfolio To Safeguard Against A Market Downturn

Before the crash of the stock market in 2007, I could still remember how I lost 70 million naira worth of stocks. Although, I perceived that most the stocks that were on the rise have no basis, in fact some of them have closed down years ago.

I had the facts, knowledge but it was too good to be true so I had to put all my investment in those stocks which made me lost that kind of amount. Usually, I would sell the stocks then give each investors their money then go home and be watching but non compliance with fact led me into such mess.

In today’s blog we will be looking at Diversify Your Portfolio To Safeguard Against A Market Downturn

As an investor, you’ve likely enjoyed a steadily rising market one time or the other. But what can easily be forgotten amidst a rising market is the perils of a downturn, and how much return it would take to recover losses. The truth is, recovering losses is much more difficult than many investors may realize. It’s important that you take a careful approach when building your portfolio to minimize risk and losses.

Understanding the pit falls of losing money can help mitigate loss aversion, which describes people’s tendency to prefer avoiding losses to acquiring gains.

Let’s take a N100,000 portfolio for example. If that portfolio loses 30% (N30,000), what is the percentage that the remaining N70,000 must earn in order to get back to N100,000? Many think that a 30% gain would be needed to get back to breakeven, but that’s incorrect. Let’s break it down a little bit further. A 30% gain on the remaining N70,000 is only N21,000 and would only bring the portfolio to N91,000. In reality, it would take a 42.9% gain just to recover the 30% that was initially lost. See the below for some more examples:

  • For a 20.0% loss, you will need a 25.0% return to break even
  • For a 30.0% loss, you will need a 42.9% return to break even
  • For a 40.0% loss, you will need a 66.6% return to break even
  • For a 50% loss, you will need a 100.0% return to break even
  • For a 60.0% loss, you will need a 150.0% return to break even

As demonstrated above, the required return rate for breakeven increases at a much faster rate as the loss increases.

You’ve heard it before: Protect your portfolio by diversifying

The inherent difficulty of regaining losses in a downturn is just another reason why diversification of your portfolio is critically important.

A diversified portfolio (one containing multiple investment vehicles) will likely contain a mixture of stocks, bonds and cash. As opposed to having all of your money tied up in one stock or asset class, a diversified portfolio can help offset swings in the market.

Understanding your risk tolerance, or how well you can handle big swings in the market, will allow you to set your financial goals accordingly. Setting realistic financial goals is a key step in developing an investment strategy for your portfolio. If you have a higher risk-tolerance (you can handle big swings in the value of your portfolio), your portfolio would contain more stocks than bonds. An example of a high-risk portfolio would be 80% stocks, 20% bonds. Adversely, an example of a lower risk portfolio would be 40% stocks and 60% bonds. In understanding your risk tolerance and goals, you will have a better understanding of how you are investing your money, and why you are investing in that manner.

Stay informed on market activity

After establishing a well-balanced portfolio, it is important that you avoid the “set it and forget it” mentality. Checking on your investments regularly and staying informed about market news will help you know if and when you need to get out of a particular investment. In addition, attend seminars and webinars organized by top experts in the field; you can join my facebook page www.facebook.com/investdata on a weekly basis for live webinars and also ask any questions regarding stock markets  In case you find your portfolio deviating from your original investment plan, re-adjusting your investment allocations, or re-balancing, will help keep your portfolio in line with your investment goals.

In conclusion, taking the time to craft a well-thought out plan for building a portfolio can help minimize losses and help you achieve your financial goals. Having a well-balanced portfolio can help reduce losses and make recovery much more manageable.

 

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4 Ways Of Losing Money In The Stock Market

Just as there are several reasons why some investments make money, there are just as many, if not more, for why an investment loses money. More often than not, there is some investor error lingering in the background of a failed investment. Many investments lose money simply because of investor behavior which is trading based on emotion and not facts. Whether the investor is trading too often or not often enough which could affect the portfolio.

However, when an investment loses money despite otherwise sound investing behavior on the part of the investor, reasons for the loss might go back to the company itself or unethical business practices.

  • No Customers: Consumers don’t buy the company’s products or services. It doesn’t matter if they have great products. No customers, No Money or profit to share. It is as simple as that
  • Effective Competition: This is very common. A company will release a new product in other to compete with the current reality of consumer behavior but at the end of the day nothing will really be achieved as a result of poor marketing technique, scaling, errors. I could still remember an advert done by Nigerian Brewery for their Star Lager brand in 2013 on yahoo. The link provided either by Nigerian Brewery was completely error 404 for 10days
  • Mismanagement of funds: The officers of the company mismanage the business, perhaps by fraud or by failing to follow a budget, and their costs exceed their income hence loss is inevitable
  • False Profit Declaration: the company’s profits are less than you were told, the contracts that were a “sure thing” never existed, or the financial statements were doctored up.

Definitely, there are no bullet-proof investments or investment strategies, but there are patterns that can save you from significant loss. In the end, good investments that make money aren’t always the most exciting (in fact, they generally aren’t exciting at all), but the key is to find the balance between the risk and reward and not make those common investing mistakes which is by seeking knowledge by attending seminars, subscribing to monthly nugget on stock investment. Many people have made mistakes so it is better you learn from them

 

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Stock Update

Market Update for the week ended July 1

NSE Opens Q3 Red, Amidst Negative Macroeconomic indices and Earnings season

The Nigeria equities market opened trading activities for the third quarter under pressure, closing in red as investors went on a flight to safety while trying to reduce risk amidst growing political concerns in Nigeria and around the globe. The week recorded a four-day decline that saw the composite NSE All-Share Indexshedding 4.39%, as profit taking and effects of the Brexit vote a fortnight ago continued.

Ahead of last Friday’s trading on the floor of the exchange, the NSEASI and market capitalisation were up about 3.34% and N314 billion respectively, for the first half of the year. This was attributed to market rebound in May and June as a result of the budget approval by the National Assembly and its signing into law by President Muhammadu Buhari after weeks of disagreements between the federal legislators and Presidency. Also, the new market-driven inter-bank foreign exchange policy that boosted investor confidence to wipe a four-month loss that turned many portfolios positive and into profit.

Market performance for the period under review after a prolonged downtrend wasmild as the nation’s stock market indices closed at 29,597.79 and market capitalisation at N10.17 trillion respectively, after touching a low of 22,330.96 and N7.72 trillion within the time under consideration. It however recorded improvement in market development and growth as technology transformed the face of the market to promote transparency that boosted both domestic and foreign investors’ confidence. It also made  trading and investing simple as more online platforms were opened with  investors now able to place trades from the comfort of their homes and offices, coupled with access to real market information that quicken  investment decision as more operators create  online portals for clients to trade directly on their own.

Recall that within this period, macroeconomic indicators were inconsistent and negative to reflect the impact of global economic transition and monetary policies to reform the financial institutions after the crash of crude oil prices in international market. This has heightened exposure of many banks and financial markets in general. This triggered struggling in many economies of today which our nation is suffering from at the moment, coupled with nuclear fiscal and monetary policiesof the government. The slowdown in the system have reflected in the key indicators such as the Gross Domestic Product (GDP) that is currently  in negative territories, inflation rate above 15% as at May and is likely to move higher when June statistics is released. Others are:high interest rate, high unemployment rate and  low exports, regardless of  capital market indicators  moved to  positive direction. Nigerians are more dependent on imports, and while internal debt burden grew, so did the nation’s investment in infrastructure. Oil prices were volatile and remained largely unfavourable, but stayingabove the 2016 Federal Government budgeted benchmark of $38 per barrel, after it had recovered 26% in the second quarter to record the biggest gain since 2009. If the current recovery of  oil price is sustained, the economy will likely rebound despite the slowdown being witnessed as the  government implements 2016 budget and provide palliatives to stimulate and drive the change concept to jump start the economy, create new investment opportunity that will influence the stock market and the economy positively.

The stock market in many economies provide the barometer by which the economy is gauged, the Nigerian equity market does not fully reflect the size of the economy. But then, any acceleration or declining in the economy is first recognised on the exchange.

As we enter into the remaining half of the year, we expect a mixed performance that will be driven by government policy and implementation of 2016 budget as fiscal and monetary policy complement each to drive economic growth and development. Further recovery of oil price will fast track infrastructure development.

Index and Capitalisation Movement

Months Open Close %Change Open Close %Change
Jan 28,842.25 23,916.15 -17.08 N9.85Trillion N8.23 Trillion -16.45
Feb 23,916.15 24,570.73 2.74 N8.23 Trillion N8.45 Trillion 2.67
March 24,570.73 25,306.22 2.99 N8.45 Trillion N8.70 Trillion 2.96
 April 25,306.22 25,062.41 -0.96 N8.70 Trillion N8.62 Trillion -0.92
May 25,062.41 27,663.16 10.38 N8.62 Trillion N9.50 Trillion 10.21
June 27,663.16 29,397.79 6.27 N9.50 Trillion N10.17 Trillion 7.05

The week in brief

The composite index NSEASI shed 1,344.26 points to close at 29,305.40 from an opening figure of 30,649.66, representing a 4.39% decline as result of investors and traders flight to safety seeking to reduce their risk exposure in this unstable financial market. The March full year scorecards released so have been below market expectation as few declared dividend, while many others are in loss position.

The half-year earnings season will kickoff this  week  after the holidays, but the interim dividend paying companies will release their results a little late because such results would be audited before being made available to the market. The market capitalisation for the period under view closed lower at N10.07 trillion from opening value of N10.35 trillion. The bearish sentiment was reflected on the mixed class of stocks that dominated the advancers’ log with less appreciation in price for the period under review. The NSEASI’s year-to-date return currently stands at 2.32 percent to remain in positive position.

Meanwhile, market breadth for the period under review was bearish and negative as the number of decliners outpaced advancers in the ratio of 52 to 22 on huge volume of buy positions of 3% and selling position of 97 percent. This resulted from profit taking, political concerns in the country and around the globe as FX policy induced rally faded away owing to reality of fundamentals especially the weak earnings release during the period under review

The international markets for the week under review moved sharply up to recover the huge losses suffered as result of the vote by Britons to leave EU, the easing off was due to investors, with traders realising that the process will take over two years and earnings season has started with numbers trickling to the market.The U.S markets were in the green amid expectations of more monetary policy.

In Europe, the ECB has expressed concerns that the economy could experience a slowdown from the Brexit, but hope for easing led to high stock prices. China has recently cut its interest to reduce cost of funds that will drive economic reforms. Global markets rebound reflected on emerging markets to record strong gains as investors perceived them as less exposed to effects of the Brexit voteto leave the European Union despite the weak economic fundamentals.

Back home, the market opened the week on a negative note with 2.43% drop and continued on the second trading session to close down with 1.60%. The mid-week’s was in red of 0.54% and reversed on Thursday with a marginal 0.8% gain, before a pull back to the negative tertiary by 0.89% to close the week’s trading. The NSEASI and other sectorial indices closed in red, except for NSEASEM that closed higher.

The week’s transaction levels, measured by aggregate volume and value, decreased by 38.49 percent and 35.29 percent respectively in contrast to previous week’s closing level. In the week under review, a total of 1.47 billion of shares valued at N17.07 billion were exchanged in 21,246 deals, compared to 2.38 billion shares valued at N26.38billion exchanged in 28,072deals in the previous trading week.

The Financial Services sector led the activity chart in term of volume, with 1.17 billion shares valued at N10.24 billion traded in 12,697 deals; thus contributing 79.59 percent and 60.01 percent to the total equity turnover volume and value respectively. The Conglomerates sector followed with 133.61million shares worth N300.10 million in 1,081 deals. The third place was occupied by the Consumer Goods sector with a turnover of 110. 75 million shares worth N4.90 billion in 3,495 deals. The reduced trading data revealed increasing fear, as many investors are running away from the market to protect their funds.

During the week under review, the share price of two companies: Cadbury and Smart Products, were  adjusted  for dividend declared. Two others: Oando and Royal Exchange Insurance, released their first quarter earnings reports, while full-year reports were presented to investors by Oando, Honeywell, Avon Crowncaps, Royal Exchange, Northern Nigerian Flour Mills, Academy Press, Chellararms, 7-Up, Rak Unity  and Red Star Express. Also, 7-Up proposed a N1.60 dividend for approval to shareholders whose names are  in the register.  Julius Berger and Conoilled the advancers chart with 15.85 and 15.65% gains respectively, while the flip side was topped by Smart Products and Honeywell which suffered 25.49 and 22.6% decline respectively.

Market Outlook

The market is likely to slow down at the beginning of the week due the holiday and traders waiting to see the expected Q2 earnings rolled in before taking any action, because the March year-end earnings reports released so far were below market expectation. Also Q2 earnings season that will kick off in July may further support the bull transition so far. However, it will depend on the strength of the numbers released and market forces.  Technically, markets still  look healthy for recovery with the oscillating mood but investors should target valued stocks to see them through in case market go the other way. The candlestick formation pattern as at close of trading last week signals recovery after losing much that morning but reduce loss as buying position improved that day. Our advice is still that any position now should be in stages as we wait to see how the global markets will adjust this morning. If you have N500,000 to invest in a stock for now, begin with buying N150,000 worth of that stock and watch market trend and the stock’s direction to increase your purchase or sell the first position if market go against you. The weekly buy position in volume was 3% while sell position volume in 97%. This supports down market, depending on  market forces.

STOCKS TO WATCH

Ucap, UBA, Oando, Eterna, FCMB, Zenith Bank, Livestock, Transcorp, , Custodian & Allied, African Prudential, Access Bank and Tigerbrand

 

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The Simplest Way To Make Your Money Work For You

There are many ways to make your money work for you while in the office, home or anywhere.

Recently, I came across my old school friend in a prestigious event at lekki, we were both
excited to see each other because it been 20years . After the event, we chatted and went
our different ways although we fixed our meeting the following day because the event ended late.
On the following day, we met at a very nice place and we started chatting. He shared his secret
which he claimed should be part of my family culture for generations to come. Although, what he told me was not new but how he did it was what amazed me. however, at the age of 45, his parent where not rich but he has build a fortune from this simple step. I will share with you. He built it from two sources; which I have started practicing and have seen that it works wonders. There are:

Deliberate saving: savings is not an easy step or let me say a decision to take. It comes with pain
because it is not part of us from childhood. So, for you to form it means, you will have to discard many things.To develop a habit of saving consistently is the key to your success and financial freedom. Just as foundation of a house is the most important because it is on the foundation that other parts are built on to form a complete beautiful building.Likewise, it is your habit of savings that your financial freedom will be built on. My friend started saving at the age of 17. He got the advice from the Lebanese he worked with. The advice is that save and let your savings work for you and how can your savings work for you? this is simple, save and invest your money into an investment that multiply overtime while it is in your bank. For instance, treasury bills for 91days that will yield an amazing interest.

Stock: Many have lost interest in stock market; anyway I once do also not until I met my
friend who told me that his dividend from his investment takes care of his yearly expenses. Initially,
I didn’t believe him because I didn’t see the possibility. He went further to tell me that he lost money too in thestock market but he met a stock broker who went abroad for several training after the meltdown to
learning and predict with the sophisticated tools they used. Since, his investment has been compounding at a rate I can’t disclose. So, he recommended that I should get a stockbroker who uses trending tool and technology to monitor the stockmarket. The question I asked him was where can I get a such a broker when broking houses are folding up and 80% of the broker we have are old fashioned. He recommended one for me and I took his advice which is setting me free financially.

I hope you can just follow the above steps. Just give it a try and if you need any help just post your comment
below and I will personally reply them

Best Regards

Ambrose Omordion

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5 Reasons Why Goal Setting is Important

According to Wikipedia a goal is a desired result a person or a system envisions, plans and commits to achieve a personal or organizational desired end-point in some sort of assumed development. Many people endeavor to reach goals within a finite time by setting deadlines.  An observable and measurable end result having one or more objectives to be achieved within a more or less fixed time frame. Setting goals gives your life direction, and boosts your motivation and self-confidence.

There are four types of goals. They are –

Specific, Non- Specific, Realistic and Unrealistic.

  • Specific Goals are goals that are right to the point and are about something really defined.
  • Unspecific Goals are goals that are too broad and have too many things to achieve.
  • Realistic Goals are goals that are about something that you can achieve and are more likely to happen.
  • Unrealistic Goals are goals that might take a really long time to achieve or might be really hard to achieve.

The types of goals you should set for yourself are specific and realistic.

Why is goal setting important?

You will experience so many benefits from learning and applying the valuable skill of goal setting the easiest way is to take you through each benefit one by one.

1) You will move away from the vague ‘shoulds’ and ‘wishes’ of your life to a life where you get clear on what you really want and generate the motivation to make it happen.

2) You will learn to always start your thinking by asking yourself what is it you really want.

3) You will have a framework of simple but powerful questions to help you think your goals through thoroughly.

4) You will ask yourself the questions that people who are already successful, your role models for success, ask themselves.

5)) You will focus your mind and concentration on what’s most important to you.

In the next article we will be discussing tips on how to plan your goals in your studies.

Please post your comment below and I will personally reply them

 

Regards

Ambrose Omordion

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Easy Come. Easy Go. Why some people can’t hang on to money & what to do instead (part2 of 2)

Thirty-two years ago, Akinola Olufemi drove truck as  a full time job.

A Recent story says that he now leaves in his own house and also cruise around with one of the latest car models.

Whenever, he is asked how he did it, his reply is that they should save 20% of their income and invest it for the next twenty-five years.

We’ve heard many stories of people who became extremely wealthy after their retirement. Whose wealthy status is appreciating every year.

If a truck driver can become a millionaire, this means that anybody can become a million irrespective of the kind of job you have or income you earn.

All you need to is just follow the 5 A-B-C strategy below and be among the millionaire in the next 20years.

Personal Budgets
Money comes in, money goes out. For many people, this is about as deep as their understanding gets when it comes to personal finances. Rather than ignoring your finances and leaving them to chance, a bit of number crunching can help you evaluate your current financial health and determine how to reach your short- and long-term financial goals by having a Spending plan created on a monthly or annual basis, a personal budget is an important financial tool, because it can help you plan for expenses, reduce or even eliminate expenses, save for future goals, spend wisely, plan for emergencies, prioritize spending and saving.
Recognize and Manage Lifestyle
Most people will spend more money if they have more money to spend. As people advance in their careers and earn higher salaries, there tends to be a corresponding increase in spending. Even though you might be able to pay your bills,  such lifestyle can be damaging in the long run, because it limits your ability to build wealth: Every extra Naira you spend now means less money later and during retirement.

Recognize Needs Vs. Wants – and Spend Mindfully
Unless you have an unlimited amount of money, it’s in your best interest to be mindful of the difference between needs and wants so you can make better spending choices. “Needs” are things you have to have in order to survive: food, shelter, clothing, healthcare and transportation (many people include savings as a need, whether that’s a set 10% of their income or whatever they can afford to set aside each month). Conversely, “wants” are things you would like to have, but that you don’t need for survival.

Start Saving Early
It’s often said that it’s never too late to start saving for retirement. But the sooner you start, the better off you’ll likely be during your retirement years. This is because of the power of compounding – what Albert Einstein called the “eighth wonder of the world.” This is saving at least 10% off your income monthly and investing for the next 25years.
Build and Maintain an Emergency Fund
An emergency fund is just what the name implies: money that has been set aside for emergency purposes. The fund is intended to help you pay for things that wouldn’t normally be included in your personal budget: unexpected expenses such as car repairs, an emergency trip to the dentist, emergency financial help to family, friends, neighbor etc.

I know that the above steps will thermostat you to wealth

Please post your comment, suggestion and inquiry below

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