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Money Talk with Nimi: Financial Choices in your 20s



For most people in their twenties, the idea of saving and investing seems like a lifetime away; most people don’t start thinking about saving or investing for their financial future until they are well into their 30s and often later. It is important to realize that the choices you make in your twenties play a critical role in your future financial security.

Here are some tips that you should consider in your twenties that will help you to build a solid foundation for your financial future.

Focus on your Career
In your twenties, getting established in your career and earning a regular income should be one of your priorities. This is the time to invest in yourself, to acquire and develop those skills that will enhance your career and boost your earnings. You might have exciting ideas about becoming an entrepreneur and getting rich, but the discipline of earning regular income from a job and sticking with it for a time, will a go a long way to prepare you for lasting financial security.

Take deliberate steps to improve your understanding of money matters. There is a plethora of information in the media through books, magazines, newspapers, radio, TV, seminars and on the internet that will guide you as you make decisions.

Establish your Goals
The first step in financial planning is to identify your goals. Your short-term goals (under five years) might include a wedding, buying a car or taking a vacation. Your medium term goals (five to ten years) may be to get a mortgage, whilst your long term goals may be to plan for your retirement.

Live within your Means
It is very tempting when you first start earning, and particularly where you have few financial responsibilities, for you to spend excessively on clothes, accessories and gadgets. Mobile phone bills can be a serious drain on your finances at this stage; with a “pay as you go” scheme, it is easier to keep track of your spending, but if you do decide to go down the contract route, shop around for one that meets your needs and read the fine print before signing on. Look over your income and monthly expenses. Create a budget so that you can see exactly where your money is going and make adjustments where necessary.

Manage your Debt
When you earn a salary, you have relatively easy access to credit. Be cautious about borrowing; it is better to borrow for things that have lasting value such as a home or an education rather than for consumables such as gadgets and clothes. Give yourself a deadline by which time you would have paid off or at least reduced the most expensive debt, usually credit card or store card debt. Pay your bills on time so that you don’t damage your credit profile. Building a solid credit history from now will important when you need to borrow more significantly in the future.

Pay Yourself First
Once your debt is under control, make your saving automatic. Even if money is tight, try to have at least 10 percent of your monthly salary transferred to savings or to a mutual fund account through a direct debit. Start small; you will be surprised how quickly this builds up. Your aim should be for you to have enough cash to cover at least three to six months of your expenses to take care of unexpected expenses such as car repairs or other bills. Once your emergency fund is in place, you start to save towards other goals.

Time is on your Side
In your 20s, you have the luxury of time. Even where you make mistakes, there is time to recover as your investments earnings compound over several years; this means that if you are consistent and disciplined, your savings will be able to grow significantly. The amount of time for which you are investing will help you make the most appropriate investment choices. Remember too, that this is the time to travel, pick up new skills, and have new experiences before you have larger responsibilities to take care of. Time is on your side; so enjoy it.

Start Investing to meet your Goals
Historically, the stock market has out-performed other types of investments over the long term, but it comes with some risk. If you don’t own any stock, the current market downturn presents an opportunity to purchase attractive stocks at bargain prices. If you don’t have the time or expertise to select individual stocks and you have only a small sum of money to invest each month, a stock market mutual fund may the ideal investment to meet your medium and long-term goals.

Start Planning for your Retirement
It may seem odd to talk about retirement when you have barely got started with work; naturally you are more concerned about your job and not the end of your working life decades away. As soon as you start work, you will be eligible to contribute 7.5% of your pre tax income to a Retirement Savings Account (“RSA”) with your Pension Fund Administrator (“PFA”) this will be matched by your employer. You have an edge if you start to invest regularly for retirement from now, as the power of compounding ensures that you can build a significant nest egg with relatively little effort.

Where will you Live?
Accomodation can be a challenge. Even if you are fortunate enough to have a free roof over your head provided by parents or other family members and friends, you can contribute to family expenses such as utility bills. You can also set aside some of the money that you would have had to use for rent to build up equity towards getting a mortgage so that you can own your own home.

Earn your Independence
It is the desire of every parent to ease the path for their children and most children will embrace this gladly. Whilst it’s nice to get a lot of help from your parents, don’t let it get in the way of your attaining financial success of your own. Earn your independence and start to take charge of your financial life. Your parents provided you with an education; now you are no longer a child; your finances are your responsibility.

It is not how much you earn that matters, it is how much you keep. The key to building a solid foundation for future financial security is to budget, save and invest regularly, and control your debt. The choices you make now, will largely determine how your life will be in the future.
Nimi Akinkugbe has extensive experience in private banking and wealth management. She is passionate about encouraging financial independence and offers frank, practical insights to create a greater awareness and understanding of personal finance and wealth management issues. She is married with 3 children.Find out more via

Nimi Akinkugbe has extensive experience in private wealth management. She seeks to empower people regarding their finances and offers frank, practical insights to create a greater awareness and understanding of personal finance.


  1. Deep

    July 25, 2012 at 8:52 am


  2. damojo

    July 25, 2012 at 9:17 am

    In summary…Don’t go broke trying to look rich, act your wage!

    • Son of Man

      July 25, 2012 at 10:21 am


    • Teris

      July 25, 2012 at 1:18 pm

      LOL!!! i like that… may i borrow that phrase?

    • damojo

      July 25, 2012 at 5:52 pm

      Yes U can. Make sure u return it tho’

    • lara

      July 25, 2012 at 3:54 pm

      thats so tru

  3. laide

    July 25, 2012 at 9:17 am

    aww…am just turning 20..thanks for this

  4. kenny

    July 25, 2012 at 9:26 am

    a very smart move for any young working adult is to start saving early, be it a “Penny”

  5. XoXo

    July 25, 2012 at 10:28 am

    Started this this year, though its a few years late. However, there is this feeling of comfort and security you get as the savings begin to grow.

  6. saphyah

    July 25, 2012 at 11:19 am

    good advice. Dont wait till you start earning big before saving.

  7. prince Joe

    July 25, 2012 at 12:58 pm

    A̶̲̥̅♏ really grateful Fø̲̣̣я̅ this post thank U̶̲̥̅̊ so much

  8. Princess of Zion

    July 25, 2012 at 1:09 pm

    I love all her articles. Always insightful, inspiring and makes me feel challenged! Definitely need to put this into practise!

  9. Thumbs up Nimi

    July 25, 2012 at 1:59 pm

    I love, love this article, because it reminds me of me. I bought a new car, paid for my post grad and bought a new flat all at 28, in the same year all the while supporting my siblings through school. I have never saved so much in my life before, literally livng from hand to mouth. I cut off everything for a whole year, and I mean everything, well except for a holiday, which i took after i made the last payment (Lord knows I needed it). Unfortunately, as i couldnt go out anymore, I lost a few friends too. They couldnt understand, why I was being ijebu, and wasnt enjoying myself. I will say when you have a goal in mind, you may need to trim off your friends, because they can be a huge distraction. Now they are still commuting, or using rickety cars, still paying ridiculous rent, and have zero savings. I’m having a good ol laugh now, and dont care one bit if they are envious. @Damojo, act your wage. Thats very good advice.

    • damojo

      July 25, 2012 at 5:31 pm

      U shouldn’t have gotten rid of them if they were your real friends. U also don’t need to laugh at them cos they drive rickety cars. I have seen multi-millionaires than can’t afford to fuel their cars now. Friends are angels, make them understand & allow them to walk in your shoes. Believe me, they will forever be grateful for life!

  10. Seun

    July 25, 2012 at 8:04 pm

    @Damojo, i disagree. Cos i have a similar experience. If your “friends” can’t understand your goals, and support you in those goals, instead, they make fun of you for being a “savingnista”, or the ones that even try to tempt you to spend money. After you’ve told them loads of times, you are trimming down, they’ll be the ones to call you and tell you about sales, in so so shops, some event you have to attend o, because you must be seen as a happening babe, or some holiday trip, everyone is going for. Those are the friends you should trim off, because such friends will lead you down a road of debt. Once, I had a friend tell me, a certain bank was doing a promo on a credit card for new customers. Ehn, that was the day I started steering clear of her. You didn’t call me about some new investment or money making opportunity, its credit card. Please o. I’m sure this person didn’t mean to be mean, or make fun. It was probably he who laughs last, laughs best.

  11. ...just saying

    July 26, 2012 at 11:15 am

    At least put the picture of a 20 year old looking person up there…haba! he lady looks 38 going on 40…just saying

  12. 2blunt

    July 26, 2012 at 11:18 am

    thanks for this piece! the advice i needed

  13. mautinchuckles

    July 26, 2012 at 4:17 pm

    everything is about doing the right thing at the right. Saving will not stop u from living big.

  14. creamy

    July 27, 2012 at 2:14 pm

    Thumbs up for this Nimi, saving and investing your money is a great way to go, you never can tell when u need it. Buyin of brazillian hair and the latest blackberry phone are not investments, there are several investment plans run by banks and even insurance companies. Make hay while the sunshines

  15. lazioman

    August 8, 2012 at 5:53 am

    Don’t go broke trying to look rich, act your wage….#WORD

  16. alanc230

    August 19, 2012 at 12:37 am

    Even if you have to start small, start saving a little money every week and watch it grow.

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