Learning to save for both the short and long term can provide your adolescent with valuable life skills and get them started on the road to financial stability.
There are several reasons for a Nigerian teen to save and invest money. The most important aspect of saving and investing as a Nigerian teen is starting, either you’re saving up for your college fees, first car or a journey around the globe.
Saving for long-term goals and massive purchases is a great approach to appreciating the worth of labour and money. An even greater benefit of inculcating the habit of saving as a Nigerian teen is that you can start to form a savings habit that will last for a long.
It’s a far more difficult lesson to learn when you’re older and have expenses and financial obligations. However, you might build some good, lifelong habits if you start while you’re young.
How To Start Up Savings and Investments
Whether you’re 19, 25, or somewhere in between, it’s not too late to start nurturing a savings account. So let’s check out a few steps on how you can start up a savings and investment plan a Nigerian teen:
1. Begin by establishing an active savings account.
Build up functional savings account now, and at all times, you’ll have somewhere to store the money you wish to save up for later. If you’re below 18 years of age, you’ll almost certainly require the aid of a guardian to create the account.
However, having a card without charges monthly or a balance requirement is great, and a great interest rate is a plus for you. Then all you need to do is tender the necessary documents and append your signature on the paperwork to open the savings account and start saving.
You could also choose to create a savings account, which often grants a higher interest rate.
2. Put the money into that savings account.
As you begin to use your new account, you’ll discover all of the features available to you, such as automating your saves, earning interest, and more. As soon as you open it, begin utilizing it. Deposit gifts, a set amount each month, or any other money you have on hand. If you forget about it, it won’t help you.
3. Begin earning to begin saving.
As a Nigerian teen, you have several options for earning cash. They aren’t all employment, either: side jobs like making things to sell on Jiji or Jumia or listing your apparel items on online stores are flexible to fit perfectly around your schedule and keep you earning all through the year.
Why You Should Save and Invest As a Nigerian Teen
1. Savings is an important financial skill to master
Learning to save is a crucial financial skill because it is required for everything from controlling expenses to long-term asset accumulation.
Paying bills, let alone saving for significant purchases like vacations and home deposits, would be difficult without adopting discipline, planning, and diligence.
2. Encourage self-sufficiency and independence
Encouraging Nigerian teens to save effectively can help them achieve financial independence and self-reliance as adults. You may assist your teen in becoming more responsible in general by pushing them to save for things they wish to buy.
Teenagers gain confidence in their own ability to attain financial goals and direct their life by setting and achieving realistic goals.
3. Encourage thrifty spending and self-control.
Along with planning, a healthy savings habit teaches teenagers discipline, which they can apply to other aspects of their lives. The practice of reinforcing a habit over time causes it to endure a lifetime.
It may be easier to distinguish between wants and needs if you have a disciplined attitude to money. Because money is finite and our needs often outnumber our ability to pay, teaching teens to save teaches them to consider trade-offs and opportunity costs, leading to better spending decisions.
They may learn to avoid impulse purchases and become better judges of whether something is a good buy. Because they are forced to link the money they wish to spend to the time it takes to earn or save, a teenager may have a greater understanding of the worth of something.
4. Many teenagers begin earning money in their early twenties
Learning to save is crucial at any age, but it’s especially vital for teenagers because this is often the first time they earn money.
Whether it’s their first job in retail, hospitality, or anything else, teens would benefit from learning how to save before they start receiving regular money.
5. Start early to maximize the power of compound interest.
Long-term benefits come from being a great saver from a young age, especially when building a financial nest egg. Compound interest indicates that the sooner you start saving, the longer your money has to grow, so even small amounts can add up to a considerable sum.
Discuss compound interest with teens and use real-life examples to demonstrate its potency. Demonstrate how little regular saves can grow into large sums over time, thanks to interest and additional choices like investment and super.
Making it a Habit to Save
The adolescent years are an excellent time to teach your children how to save wisely. At this point, your kid is likely to be working and earning money or will be working and earning money in the near future, and they will be able to apply for loans and other financial products.
In addition, helping your children learn to save will help them make better consumption decisions and gain satisfaction from setting and attaining financial objectives.
Finally, starting early with saving means your adolescent will have more time to properly utilize the power of compound interest to build a solid financial future.
We recognize that parents won’t want the best for their children’s future at Student Super. That’s why we established a super fund to assist young Australians in getting a leg up.