How You Have Been Saving Money The Wrong Way

Saving money is an act of every common man but most people tend to do it the wrong way. This owes a lot to little or no financial knowledge.

What I’m about to tell you about saving money may sound awkward and lead you to disagree in all ramifications. Disagreeing is okay and I will understand if you do. All I ask is that you keep an open mind.

How we have been saving money

You and I save money to buy what we want. We save money to build a house, buy a car, buy gadgets, etc. Often times, we join cooperative societies to satisfy our insatiable wants.

Okay, let me break it down.

Let’s take a fresh graduate who earns $1000 monthly as a typical example. Firstly, he saves for his basic needs and pays off debts, if there’s any. These basic needs include a moderate accommodation, feeding, transportation, etc.

Then he starts saving to live a more comfortable life — build a house, own a car, etc. Two years later, most people start to see him as a successful person and perhaps, responsibility will start increasing.

That’s what we all do. It’s the kind of life we mostly dream of.

What if I tell you it’s wrong? What if I tell you it’s an easy route to failure? That’s where you disagree, I guess. Honestly, If you have one income and no investment, this is a wrong approach to saving money.

Just keep an open mind, okay? Let’s start with why it’s wrong.

Why that is a wrong approach to saving money

Your salary can’t keep coming in forever. In fact, it may halt in the next three months. The company you work for may urgently need downsizing. What’s your way out if you get laid off? Imagine your salary stops today, can you survive another year?

I don’t wish for you to get laid off. I’m only stating the facts. Even if you don’t get laid off, you’ll eventually retire.

If your job stays till retirement, responsibilities increase with time and depending on the economy of the country, inflation may as well, increase. Meanwhile, your salary may or may not increase. Even when it increases, it may not be able to meet up with the economic status. This can make saving become a difficulty.

Often times, this is where the search for a greener pasture begins. You start searching for a job with a higher and better pay. This process includes the need to acquire more certificates which invariably often need money too.

All in all, the wrong approach to saving money only makes you an average person. You may not be broke, but you won’t be rich or have excess money in the long run. The right approach, however, will make you rich and put your income on autopilot.

The right approach to saving money

Rule 1: Don’t keep money coming from a sole income in the bank for too long.

If you save money in the bank, forget the little interests, inflation will eventually reduce its value. Instead, spend the money on investments by acquiring assets.

Rule 2: Save money to invest, then use the profit from your investments to satisfy your insatiable wants.

When you start saving money, forget about any want you can do without. Don’t save for those wants. Buy your needs. Save the rest to invest. Focus on creating multiple sources of income. Then after some years, you can spend the revenue from your investments on those wants you once neglected.

Rule 3: Invest wisely.

It’s that simple. Learn. Research. Read. Ask. Then, invest wisely.

Always remember, your savings is to make you rich, not average. If you save and invest correctly, you’ll be amazed at how much you can achieve in 3 to 5 years. Don’t be clingy to your money by saving it in the bank, start investing now!

Questions, queries, and opinions are highly welcome.


  1. Great stuff. But wait, what about low-income earners saving N1,000 every month? Is it wrong to save in the bank? They need to keep that money there for a long time to be able to raise enough capital for their business. Just thinking.

    In fact, not everyone wants to start their own business. Some want to be employees — they find themselves successful in that direction. What do you think?

    • Thank you, Eze.

      Regardless of your income, having the same model in mind helps you save appropriately:

      Rule 1: Don’t keep money coming from a sole income in the bank for too long.

      Rule 2: Save money to invest, then use the profit from your investments to satisfy your insatiable wants.

      Rule 3: Invest wisely.

      Then repeat. It’s that simple.

  2. I just started my career and been thinking of a perfect platform to invest my money. Thank you for sharing this. Can you give me some more tips on investing? What is your take in insurance?


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