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Traditional Ways of Saving Money In Nigeria

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Traditional Ways of Saving Money in Nigeria

Have you ever wondered if any of the traditional ways of saving money in Nigeria are still effective today? You most likely have, because that’s why you’re here.

In case you didn’t know (though I’m sure you did), ancient Africa had its own system for handling everything, from healthcare to finance. So, there are traditional ways of saving money in Nigeria – and some of these methods of saving money in the olden days may still be effective today.

So, you may have thought to yourself, “I’d like to save money every month, but I don’t have time to go to the bank,” or “I’d rather save money the traditional way.”

Continue reading to learn everything you need to know about the traditional ways of saving money in Nigeria in the past.

Do Any of The Traditional Ways Of Saving Money In Nigeria Still Work?

The answer to that question varies based on the method you’re considering. There were many traditional ways of saving money in Nigeria in the past, and while some of them are no longer fanciful (or may not guarantee a favorable result), others still perform marvelously.

Of course, the goal of newer technology is to improve on the older ones. As a result of the modern financial and banking system, traditional ways of saving money in Nigeria have become anachronistic, not necessarily obsolete (I hope I’m not contradicting myself). What I’m saying is that they may still work, but not as the go-to method since more modern approaches now exist.

Why?

Saving money under the ground, for example, may not be ideal or current, but it still accomplishes the goal of saving money, doesn’t it?

And today’s thrift or corporative groups are all continuations of Nigeria’s ancient methods of saving money—and they continue to serve their objective.

So, while traditional methods of saving money may not be fully obsolete, they are archaic in the sense that there are better, quicker, safer, and sleeker ways to save money today.

What Is Wrong with The Traditional Methods of Saving Money?

Security. There was little to no security in the means of saving money in the olden days. You could save your money using your preferred technique and have it stolen by someone who knows what you’ve done. You may even lose sight of where you saved it. Or, in other situations, one may pass away with no other person knowing where their money is stashed.This is why money has been discovered in the most unusual places, years after its owners have passed on to the great beyond.

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There’s also a lack of accountability and mobility. As a result, you won’t be able to readily transfer your savings unless you physically move them in the form in which they are saved.

However, the goal of this piece is to explore Nigeria’s traditional methods of saving money in the olden days, which we will do right away.

Top 6 Traditional Ways of Saving Money in Nigeria

Purchasing Cows and Other Livestock

Looking back, I believe this is an excellent way to protect one’s funds. Similar to today’s Bitcoin or stocks, it is almost the only method of saving money in the olden days that could bring returns or dividends among the various traditional ways of saving money in Nigeria.

As you are aware, assets like Bitcoin or stocks appreciate over time, which is also true when you purchase livestock. As they grow older, their worth increases. However, as with any investment, there is a risk. In the case of livestock, there is a chance that they will become ill. Some may even die. So, as profitable as this method of saving is, it is not without risk. Some people still practice this today, and you know why – protection of funds from inflation.

Piggy Bank

This is one method of saving money in the olden days that is still very commonly used in today’s society. It is primarily used to collect loose change.

What exactly do I mean by “loose change”? I’m referring to the small sums of money you have lying around the house unused. Assume you just returned from a grocery store down the street where you received a 600-bucks change. Someone with a piggy bank will easily tuck a hundred bucks into their piggy bank and keep the remaining five hundred for use later that evening.

This way, you can make small savings that have no bearing on your spending.

Nevertheless, when you open your piggy bank at the predetermined time, you will find an impressive amount – as the case may be. The joy is not in getting a large sum of money from one’s piggy, but in the fact that the money feels like free money. Because you would have otherwise spent all of the money you had saved on things you wouldn’t even be able to account for.

Piggy banks can be made of a variety of materials, including wood, metal, and even clay. The goal is the same, though: to save money that could have been used on some random, unaccountable stuff. You can buy a piggy bank online today. It’s one of the most convenient method of saving money in the olden days.

Thrift Collection

Saving with thrift collectors, also known as Ajo, was one of the smart ways to save money in Nigeria in the olden days. It is one of the traditional ways of saving money in Nigeria that is properly documented.

How is Ajo Done?

A collector visits you every day (or on predetermined days), and you give him or her a predetermined amount of money to save, and they record it both on their ledger, and on your customer card. He or she comes around regularly as agreed–this could go on for a month, three, six months, or even a year.

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As an artisan, trader, or self-employed person who is paid by hand daily, this remained one of the simplest ways to save money – until mobile banking and POS agents flooded every nook and cranny of the country.

Until POS agents flooded the country, going to the bank was a hassle for these artisans, and even if they could look past the stress, the banks would have closed by the time they’d finished their day’s work. It’s fine to imagine that they could deposit sales from previous days’ business on the current today, but that assumes that they have the time to do so – they will, after all, be at work today.

As a result, the best way for these traders to save money was for a thrift collector to visit them, collect their savings, record them, and then remit them when due. And yes, the thrift collectors had charges – albeit small.

Of course, this method has flaws, and someone with trust issues is unlikely to try it, but it was once one of the most common methods of saving money in the olden days.

Cooperative Organizations

This is one of the traditional ways of saving money in Nigeria and is still widely used today due to its effectiveness.

What is The Idea behind Cooperative Orgnizations in Nigeria?

A group of people comes together and agrees to contribute a certain amount on specific days of the week or month. They each contribute the agreed amount, and one of them receives the entire sum. They repeat the process on the next contribution day, giving the money to another member, and so on, until everyone in the group has received theirs.

Let’s say eight people agree to form a group like this. They agreed to make a weekly contribution of 5K each. That means the contribution period will last for a total of eight weeks. The first person will receive the entire 40k in week one. The following person receives another 40K in week two, and so on until the eighth person receives

These people may be united by a common goal. For example, they could live in the same neighborhood, be coworkers, or belong to the same religious group.

This is typically done to raise capital for a specific business or to put money aside for a large purchase, or anything requiring a lump sum of money. As a result, it functions as a form of a no-interest loan that assists participants in funding their cause.

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It is still done today, so you may hear about it now and then. The Yoruba people refer to it as “Ajo,” the Igbo people refer to it as “Esusu,” and the Hausa refer to it as “Adashe.” It is still one of the most effective traditional ways of saving money in Nigeria – even today.

Putting Money into The Ground

Okay, you didn’t see this coming, did you? It was one of the most practiced traditional ways of saving money in Nigeria in times past. People choose a location, which could be in their home, the compound, or even the farm.

They dig a hole in the ground and bury their money there. Of course, they’re likely to forget where the money was hidden. Trust them; they probably thought what you thought too -what if I forget where I buried it? To counter that, they leave a mark around the area to ensure that they don’t forget where they buried their money or that the area can be easily identified.

So, with that, they can identify the area and dig up their money whenever they need it. Clever? To avoid scrutiny or the authorities, I heard some dubious politicians do this today.

While it was a good method of saving money in the olden days, it also allows thieves to escape with stolen money.

Random Money Saving Methods From The Olden Days

Some other traditional ways of saving money in Nigeria include: hiding money inside the pillow so that no one can steal it while you sleep – amusing, right?

Some people also keep their money hidden within their homes’ walls. This is even safer because it deters thieves to some extent. However, in the event of a fire or a building collapse, it poses a higher level of risk.

In the event of a fire outbreak, it is nearly impossible to recover any money, as opposed to a building collapse as there may be a glimmer of hope of recovering your money if there is a building collapse.

So, while some of these simple traditional ways of saving money in Nigeria are anachronistic, some others are still in use today. Some of them even help in the raising of capital for a business. Others simply assist in being economically prudent and improving saving habits.

Are there any traditional ways of saving money in Nigeria that you are familiar with or have used? Let us know what you think the disadvantages of each of these methods are in the comments section below. Don’t forget to share this on your favorite social media platform so that others can learn about the methods of saving money in the olden days.

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