What is the impact of the economy on your income channels and Standard of living?
According to recent report;
The National Bureau of Statistics reported this morning that in May, the Consumer Price Index (CPI) which measures inflation recorded a relatively strong increase for the fourth consecutive month in 2016.
May Inflation rate rises to 15.6% all time highest in last Six (6) years, and might continue.
According to the report; “The reported increase in core inflation for the month was largely due to major increases seen in the Passenger Transport by Road, Liquid Fuel (kerosene), Fuels and Lubricants for Personal Transport Equipment (Premium Motor Spirit) and Vehicle Spare Parts groups; Imported food inflation surged to 18.6% in May from 16.4% the previous month and 18.6% increase in FX on imported food index. The category for housing, water, electricity, gas and other fuels surged by 22.0% in May.
Estimated GDP at the end of June is -1.5% which will automatically result in RECESSION.
WHAT IS THE IMPLICATION OF ALL THESE JARGONS ON MY MONEY AND STANDARD OF LIVING YOU MAY ASK?
You can’t afford to act dump this period and pretend as though it doesn’t affect you neither can we keep blaming the government.
Here are of the implications:
1. The rate at which people will transact business with you will reduce especially if you are not in the “Category A”products of livelihood.
2. The cost of Food, Housing, Transportation, and Education etc will rapidly increase which affect your savings.
3. Interest rate on saving and some investments might be affected.
4. Cost of imported items will be increase
5. Debt to income ratio might be increase
6. The value of your current income will be drastically reduced due to increase in the cost of items.
7. FX is likely to increase.
8. High loss in investment funds due to desperation to earn money.
But the interesting thing is that, this is one of the best opportunities to make money, to multiply your savings. But how can you save when what your income is not enough? Some of us are yet to fill the effect.
Here are few tips on how to soar this period:
1. Don’t just SAVE money, HEDGE your funds
2. Be creative when budgeting for your living expenses and be discipline
3. Look for ways to create alternative sources of income.
4. Be Aggressive with investment
5. Reduce your liabilities (money leakages)