Olasunkanmi Akinlotan highlights 10 steps to manage your finances amid persistent economic challenges ravaging Nigerian households, which call for fresh techniques to survive the hard times

In 2024, businesses and families experienced hard times due to the record high inflation, which brought many small-scale businesses to their knees, failing to acclimatise to ‘the new normal.’

To successfully navigate 2025, it is expedient to consider some steps as managing finances this term will comes challenges, especially for Nigerians grappling with rising prices and unpredictable costs.

However, with careful planning and smart budgeting strategies, you can take control of your finances and stay ahead of the negative curve.

Here is quality guidance with practical tips for you to navigate this year with confidence.

The impact of inflation on your budget reduces the purchasing power of your income, making everyday essentials like food, transportation, and housing more expensive. In Nigeria, inflation has been a persistent issue, affecting nearly every aspect of daily life. Acknowledging this reality is the first step to creating a budget that works despite the economic challenges.

Here are 10 smart steps to help you manage your finances in 2025:

Step 1: Assess your current financial situation

Before planning for the future, you need to know where you stand today. One should start by;

Tracking your spending: Use budgeting tools to see where your money has gone over the past three months.
Evaluating your income sources: Account for all your income, including your salary, side hustles, or passive earnings.
Identifying wasteful spending: Spot areas where you can cut back, such as unused subscriptions or frequent takeouts.
This self-assessment lays the groundwork for creating a realistic and effective budget.

Step 2: Adopt the 50/30/20 Rule

The 50/30/20 rule is a simple way to allocate your income:

50 per cent for necessities: Cover essentials like rent, utilities, groceries, and transportation.
30 per cent for wants: Use this for discretionary spending, such as entertainment or hobbies.
20 per cent for savings and investments: Focus on building an emergency fund, saving for goals, and growing your wealth.
If rising costs make it hard to stick to these percentages, tweak them to prioritise essentials without neglecting savings.
Step 3: Prioritise savings with automation

Saving money can be tricky when expenses are high, but automation simplifies the process. Set up automatic transfers to your savings account or investment portfolio each time you’re paid. WealthBuddy allows you to create different plans with automation to help keep you consistent.

Pro Tip: Start small if you need to. Saving even N5000 monthly can add up over time, especially when paired with smart investments.

Step 4: Budget for rising costs

Inflation means prices will likely rise throughout the year. Stay ahead by:

Reviewing your budget quarterly: Adjust your spending categories as needed.
Creating a buffer fund: Set aside money for unexpected price hikes.
Comparing prices: Look for deals, compare prices across markets, buy in bulk (if possible), and take advantage of discounts.
Step 5: Focus on debt management

Managing debt is key to financial stability. Here’s how:

Pay down high-Interest debt: Prioritise clearing high-interest loans.
Avoid new debt: Unless it’s for productive purposes like starting a business, minimise borrowing.
Refinance when possible: Consolidate or refinance loans to reduce monthly payments.
Step 6: Embrace side hustles

Inflation can shrink your disposable income, but a side hustle can fill the gap. Popular options in Nigeria include freelancing, selling products online, or offering services like tutoring or graphic design. Use this extra income to boost your savings or offset rising expenses.



Step 7: Plan for annual expenses

Annual expenses like school fees, rent, or festive spending can disrupt your budget if not planned for. Here’s how to stay prepared:

Break down annual costs: Divide large expenses into monthly savings targets.
Use Wealthbuddy’s target savings: Create a savings plan for each major expense.
Start early: The sooner you start saving, the less stressful these costs will be.
Step 8: Invest for long-term growth

Budgeting is about managing today’s cash flow, but investing is about securing tomorrow’s wealth. Despite economic challenges, opportunities exist:

Treasury bills and bonds: Low-risk options that offer steady returns.
Stock market investments: Invest in strong-performing industries to diversify your portfolio.
Mutual funds: Pool resources with other investors for professional management on your Wealthbuddy app.
Read articles on mutual funds, stocks, and Treasury bills to better understand these financial products.

Step 9: Monitor and adjust regularly

Your budget isn’t static—it’s a dynamic plan that evolves with your needs. Make it a habit to:

Review monthly: Ensure your spending aligns with your goals.
Celebrate wins: Reward yourself for reaching milestones like paying off debt or hitting savings targets.
Stay informed: Keep up with economic trends that may impact your finances.
Step 10: Leverage technology

Technology makes financial management easier. WealthBuddy allows you access to savings and investment opportunities from the comfort of your home.

Conclusion: Navigate 2025 with confidence

Budgeting during times of inflation and rising costs can seem overwhelming, but it’s achievable with the right strategies. By understanding your financial situation, prioritising savings, managing debt, and staying flexible, you can thrive in 2025 and beyond.

WealthBuddy is here to support you every step of the way. Whether you’re starting your financial journey or optimising your budget, our products and services are designed to make managing your money easier.

Let’s make 2025 the year you take charge of your finances and build a brighter future.


https://punchng.com/steps-to-manage-your-finances-amid-economic-challenges/