Investment opportunities for all income levels

There is no excuse to remain on the same financial level.

This article is to remind you that you MUST be INVESTING your money in order to grow your wealth and achieve financial freedom.

Many people haven’t started on this investment journey and are not paying attention to building an investment portfolio for many reasons. They have all sorts of excuses ranging from lack of knowledge, low income level, fear of taking risks, current indebtedness, to lack of financial discipline. If you are one of such people, I ask you to PAUSE and have a change of mindset.

Anyone and everyone can have investments. There are investment options for all income levels.  
The first step is to build up your savings which you can then channel to available investment opportunities. No matter your income level, you can put something away as savings towards your investment portfolio. Depending on funds available to you, your investment portfolio should be spread across 3 markets; Money market, Capital market and Real estate market.
 
If you live in Nigeria, you can begin your investment journey with as little as N5000. Unbelievable right? Let me share some investment opportunities that show you can invest irrespective of your income level.

Investment opportunities for Low Income earners
 Stocks – You can open an account with a stock broking company and fund your account periodically (monthly/quarterly/annually) as it is convenient. You can then subsequently instruct them to buy shares on your behalf. You can begin this investment with as little as N10,000.
Fixed Income – You can invest in the FGN savings Bonds, and this allows investment from N5000 and in multiples of N1000 thereafter.
Naira Mutual Funds – You can open an account with a finance institution and fund your account periodically as it is convenient. Most of the institutions will allow you start with N10,000.
Dollar Denominated Mutual Funds: Dollar denominated mutual funds allow you to conveniently invest and earn returns in foreign currency. Depending on the financial institution, you can invest with as little as $100.
Foreign stocks/shares: Stocks have a history of providing high potential returns over time. If you are based in Nigeria, this should not be a limitation as there are many reliable platforms that allow people resident in Nigeria to invest in foreign stocks with as little as $100.

Investment opportunities for High Income earners

In addition to the investment opportunities available to low-income earners, high income earners can invest in the following:
FGN bonds   – You can also invest in the FGN savings bonds subject to a maximum of N50mln per investor.
Eurobonds – Eurobond is a type of bond issued in a currency that is different from that of the country or market in which it is issued. If you want to invest directly via the primary market, the minimum investment amount for Eurobond is $200,000. You can however invest in lower amounts via the secondary market.
Dollar Denominated Mutual Funds: Dollar denominated mutual funds allow you to conveniently invest and earn returns in foreign currency. The funds invest mostly in Federal Government and Corporate Eurobonds. This investment is low risk and there is no cap on what you can invest.
Treasury bills – Treasury bills are promissory notes issued by the government cum central bank to raise funds and control the money supply. They are the safest class of investments as the risk is very low being issued and backed by the sovereignty of the nation. Investment in the primary market starts at N50mln while you can buy lower volumes from the secondary market.
Commercial papers (CP) – These products usually attract higher interest rates as they are typically issued by banks or corporations to meet short-term financial obligations. When you invest in a CP, you are lending money to the issuer of the CP via the bank or institution helping them raise the funds. CPs are usually raised for funding a new project. The investor must be careful to know the history of the company trying to borrow money via CP.
 Real estate – Buying properties and leasing these out has been proven to provide steady rental income. Though capital intensive, if the property is located in a good area that easily attracts tenants, the investor will be smiling to the bank.
 
Let me also share three of my golden rules for investing:
DIVERSIFY your investments – Do not put all your eggs in the same basket. Do not put all your funds in the same investment class. Spread your risk around.
STAY INFORMED – Do not invest if you do not understand.
DON’T FOLLOW THE CROWD – Don’t invest in an option because someone did. Invest based on your financial targets, your personal circumstances and your risk appetite.

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