PAY YOURSELF FIRST.
For many people in Nigeria,the economic climate is tough. Turbulent. (Financial) Resources are lean, while the obligatory financial rodents attacking those meagre resources are legion.
There is this saying that the smartest way to keep (conserve) money is to invest that money in non liquid (fixed assets) assets. In my neck of woods, they also say that, ‘money that is simply not available cannot perish in curing hemorrhoids’. [Owo ti ko si, jedijedi ko le gbaa]
It’s like having a full tank of fuel in your car, or you just loaded good credit unto your phone, or just bought a data plan, awash with GigaBytes. Unless you check yourself, the likelihood is that you would blow that credit on some useless calls, or go peregrinating with your car on non productive visitations or journeys. It’s just psychological.
Having loose funds, with no specific usage plan for it, is a constant source of temptation for reckless and ill thought out use. Also, I have realized that, using debit cards and other electronic payment forms encourage us to be reckless with spending. When you count out ₦190,000, cash, for that spanking new Samsung Galaxy Edge smartphone, you would likely feel more pang than if you merely pay by transferring
Now, the obverse of this is the issue of paying yourself first. Most people would pay others first before ‘paying’ themselves. You would be shocked to realize that you are mostly working for other people, paying them, and neglecting to pay yourself. You pay your house rent, pay your mechanic, pay the food seller, pay that smartphone seller, pay government via taxes. Each time you spend, you pay somebody else. It is when money remains that you (usually) remember to pay yourself (by way of investing)!
And here we are, deluding ourselves that the money we individually ‘earn’ belongs to us! . The only money that’s truly your own is the one you get to ‘keep’ – via investments.
We need to reverse the mentality. The mentality of spend, then save/invest what’s left. It is smarter to save/invest FIRST, deliberately, then spend what we have left after investment. In other words, you pay yourself first before paying others.
After all, everybody else is looking after their individual financial progress. You should too. By paying yourself, FIRST.
This is the bedrock of ‘esusu’ and ‘ajo’. Both of them compel you to pay yourself by saving/investing. regularly.
‘Ajo’ is daily regular contribution that traders (people with daily cashflow) take part in. You ‘pay yourself’, daily, and ‘survive’ on what is left. ‘Esusu’ is like Local mutual funds usually predicated on regular pooled financial contributions, suitable for salary earners. That way, you have periodic access to bulk pooled resources (funds) which you can channel to something productive. They both encourage the concept of paying yourself first, regularly.
Remember, pay yourself FIRST. Always.