Know Yourself
Know Yourself First
Self-knowledge is essential to succeed in investing in any type of investment opportunity. To succeed in any venture at all, you must have this knowledge. Self-knowledge is the most deficient knowledge humans in-general fail to seek because of the illusion of knowing by just being alive. Just because you have been breathing in air for decades doesn’t automatically mean you know the composition of the gases that make up that air you breathe. if you don intentionally find out, your life will continue, oblivious to that knowledge.
Like the air you breath, just because you are alive does not necessarily guarantee you know yourself deeply. You may know some basic information like your name, where you live, what you like and don’t like.etc. but you may lack the insight into your own character, abilities, feelings or motivation.
Unlike the air you breathe, not knowing or having this self-knowledge that truly matters will limit you in life and in investment.
The first step into being a successful investor is to know yourself. Self-mastery is important because it can determine what type of investment vehicle will align with you which can also determine the return of investment.
For example: are you a risk taker or do you like to play safe?
Are you patient enough to prefer a long-term investment strategy or do you lack it and thus default to short term investment?
Are you bolding enough to stand on your decision even when it appears it is not favorable to you in the short run or are you easily persuaded to follow the crowd in doing what is popular?
How do you react to financial loss or unfavorable circumstances? Are you emotionally stable, resiliently resourceful, bouncing back, getting back up when you experience loss or do you breakdown emotionally, blame everything and everyone around you and want to give up?
Are you open minded, eager to learn and try new things even if there might be some risk involved or do you just want things the way they are or hate taking actions on things you can’t fully control?
Your psyche and understanding also plays a major part like do you think there is a quick way to make money or do you believe that making money is a process that takes time and corresponding effort? What do you think money is? Are you driven by it? Does it change your behavior when you have it or lack it? because understanding your metal state will control your actions which will correspond control where you invest, what you invest in, your investment strategies, your expectations, your satisfaction or the lack of it and the overall investment outcomes be it either short term or long.
This knowledge will really help you gain perspective and help us know what strategy we can use to guide you to achieve the best outcome for your investment’s goals.
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Frequently Asked Questions
Are you new to investing, or new to investing in Nigeria, you will find our Frequently Asked Questions a good starting point
Very important. Assets can potentially generate income, appreciate in value, or both. Examples include shares in businesses, bonds, investment funds, productive property and ownership interests in businesses. The distinction is important because consuming income and owning productive assets lead to very different long-term financial outcomes.
Income is a flow of money. Wealth is a stock of accumulated resources. A person can earn a large income but spend almost everything. Another person can have a moderate income but consistently save and invest and eventually accumulate substantial assets. The goal isn't merely to increase income. It is to convert part of your income into productive assets.
Money is a medium of exchange that allows people to buy goods and services, save for future needs, and measure the value of things. Beyond spending, money gives you the ability to meet your needs, handle emergencies, pursue opportunities, and make choices about how you live. Money itself is not wealth. How you earn, manage, save, invest and protect money determines whether it helps you build wealth.
Add the current value of everything you own that has financial value. For example: Cash: ₦2m Investments: ₦5m Property: ₦20m Business interest: ₦3m Total assets = ₦30m. If you owe ₦8m, your approximate net worth is: ₦30m − ₦8m = ₦22m. Tracking net worth over time can give you a clearer picture of financial progress than income alone.
There is no universal percentage that works for everyone. A common starting point is to aim for 10% or more, but your actual target should depend on your income, expenses, debt, emergency savings and financial goals. If 10% is impossible today, start with what you can afford and gradually increase it. The important thing is to develop the habit of consistently spending less than you earn.
Wealth is the value of the financial and physical resources you own, minus what you owe. A simple formula is: Net worth = Assets − Liabilities Assets might include investments, cash, business interests and property. Liabilities include loans, credit-card balances and other debts.
Being rich often describes having a high income or being able to afford expensive things. Being wealthy generally means having substantial assets and financial resources relative to your liabilities and spending needs. Someone can look rich while having significant debt. Someone else can live modestly while quietly accumulating substantial assets. Income can make you look rich. Assets and financial resilience help create wealth.
Common wealth-building routes include: Building a profitable business Investing in diversified financial assets Owning productive real estate Developing valuable skills and increasing earning power Owning intellectual property or other productive assets Consistently saving and investing over long periods Most sustainable wealth-building strategies involve owning assets that can produce income or appreciate in value.
Primarily because of inflation. Inflation means that the general price level of goods and services increases over time. When prices rise, the same amount of money generally buys fewer things. For example, if something costs ₦10,000 today and inflation causes its price to rise substantially over several years, ₦10,000 in the future may not buy the same quantity. This is why simply holding cash for very long periods can reduce purchasing power.
Inflation is a sustained increase in the general level of prices. If your money earns 3% but prices are rising by 10%, your purchasing power is falling even though your account balance increased. This is why investors often consider real returns, returns after taking inflation into account.
