Let’s Talk About Wealth Preservation
Making money is one thing, but keeping it? That’s a whole different ball game—worms like inflation, currency depreciation, policies and a few other, always feel entitled to bite into your fortune.
It’s a good time to breakdown how to deal with these vices.
We can start with 3 common challenges to wealth preservation in Nigeria
- The Naira Is on a Rollercoaster Ride: Nigeria’s inflation consistently hovering above 20%—meaning the value of your funds depreciates simply because they exist.
- Government Policies Can Change Overnight: One day, the government allows easy forex transactions; the next, there are restrictions. Sudden changes in taxation, fuel subsidies, or capital controls. Just different forms of jabs at your financial plans.
- The Stock Market Is a Wild Ride: While Nigeria’s stock market offers potential for growth laced with unpredictability. Also, beyond diversifying, factor in no 1 & 2 above, so your growth isn’t academic
Smart Ways to Protect Your Wealth
- Multiple baskets
A diversified portfolio helps reduce risks. Here’s how:
- When a currency weakens, it means another gains. So holding assets in different currencies always gives you a foot in the one that gains as well. Think offshore accounts, foreign real estate, or global funds – Foreign Currency Investments
- You still need naira to cover expenses within, so we fit in treasury bills, government and corporate bonds provide stable returns – Fixed-Income Investments
- Sometimes you invest at beating the challenges at its game by investing in high-growth sectors like fintech, healthcare, and renewable energy. Raise the bar higher than inflation and its colleagues – Private Equity & Venture Capital
- Safe Haven
Real estate remains one of the best ways to store and grow wealth, but….
- Not every location grows at the pace of the economy, while some have also plateaued over time. Find that sweet spot – locations with good potential
- Land banking is good, but investments that can provide steady cash flow (commercial buildings, luxury rentals, Airbnb, etc) will do you one better – Income-Generating Properties
- Absolutely nothing stops you from buying property in the UK, UAE, or Portugal (Golden Visa program) can give you added security and residency options – Offshore Real Estate:
- The bell
From when the bell rings to when it tolls, ensure the following…
- You are eating from the stable pies – Recession-Proof Stocks
- You are not banking on tunnel vision and losing out on foreign markets that reduces your exposure – Global Investments
- Real Estate Investment Trusts (REITs) and Exchange-Traded Funds (ETFs) provide diversification with less risk – REITs & ETFs
- Pass the baton properly
What is the point if it all goes away and your kids lose the advantage you gained
- Ensure your assets are managed and passed down the right way. – Family Trusts
- Help with your taxes, but not at the detriment of your legacy – Tax Planning
- If there is ever a need to go down, cub the domino effect – Legal Protections
- Win – win
There is a world where your wealth grows while satisfying your lifestyle
- First currency ever and a time-tested hedge against inflation – Gold & Precious Metals
- collectibles with resale value – Luxury Assets:
Reality; doing this right requires highly skilled professionals providing expert guidance. You are always welcome to reach out to Nigeria’s first Private Client focused firm – Acuity Partners – for guidance
Final Thoughts
Wealth in Nigeria isn’t just about making smart investments—it’s about thinking ahead and factoring present realities and future pitfalls
