“…. And this is your year of greeeeeeaaaat financial breakthrooough!!”  

The crowd thundered a resounding “AMEN!!” in response to the Pastor’s declaration.

“Speaking of financial breakthrough…” began Segun as he turned to whisper loudly to Emeka. They were in Sunday service. Emeka was in no mood to be distracted and considering his current circumstances, especially not during declarations regarding finances. He was starting to regret having invited Segun to church.  

“I just joined this sure banker financial deal; it’s called MMM…” Segun continued in an excited whisper that could be overhead by the rest of the congregants on their pew. From the corner of his eye, Emeka could see parishioners pretending not to be interested in what Segun was saying.

“I dont know the details of how it works oh but my colleague told me she put her money in and got back double what she put in. Me, I kuku sold my car and put in every single money I had, after all, the return is guaranteed” Segun said the last statement smugly as he turned back to face the pulpit. 

“What did you just say?” Emeka asked incredulously. 

“Shhhh” Segun replied dramatically. “We are in the house of God”

************************************************************************

“Now that you have paid off your debts, you need to raise an emergency cash fund” 

Emeka nodded as Chief was speaking. It had been over 6 months since they last met. Emeka felt like a different man. He had no more anxiety, no more feelings of sadness that he was failing himself. His mind wandered to the conversation he had with Segun earlier that day. “MMM? How authentic is that opportunity?” Emeka reined in his thoughts when he realized that Chief was still speaking  

“Your emergency fund should have enough money to sustain your expenses for about a year.  You must not touch it except for emergencies like job loss or…by the way, I hope you have insurance?” 

Emeka shook his head slowly. 

“You need to get it. It protects your savings from being wiped out by an emergency” said Chief “It also buys peace of of mind. Make sure that your health and all properties that cannot be easily replaced like your car and your home are always insured by a reputable company. Reputable being the key word”

“Once you have your emergency fund set aside, you will be ready for the the third rule of wealth, which is this”;  “Make your money grow”

“By making more money, right?” asked Emeka, wondering if this was the right time to ask about MMM.

“Sort of.” said Chief. “You have to start making your savings work for you. This means to invest in the right things. Investing is simply telling your money where to go instead of wondering where it went, like you have been doing all these years. There are two main goals for investing; you can either be investing for capital gains or for cashflow. Capital gains means investing in items that you hope will increase in value so you can cash out at a later time. On the other hand, investing for cashflow, means that you buy items that produce a steady stream of money for you”

“Emeka, from what I just explained, what would be an example of investing for capital gains?”

Emeka thought for a moment and replied hesitantly “Buying stock with the hope that they increase in value?”

“That is correct” said Chief, nodding his head approvingly. “using this same example, stocks can also be used to invest for cashflow. To do that, you would be buying stocks that yield dividends. The aim is to have enough stocks so that the dividend makes a meaningful income stream. Capitals gains investing has its place but my personal preference is investing for cashflow. Investing for capital gains feels to me like planting a tree but only benefiting from it when you cut it down and sell the wood. Investing for cashflow however, preserves the tree and profits from selling the fruit instead.”

“Or like selling eggs from your chicken rather than killing it for meat” ‘ Emeka said. 

“Gbam! Chief concurred as Emeka turned around startled. 

“What? Chief said with a smile “My children keep me current”

Chief continued on a more serious note “Investing for cashflow requires serious commitment but you don’t need to have all the money at once. Once you start investing, over time, compound interest or as Warren Buffet likes to call it, “the 8th wonder of the world” will work in your favour.

Emeka saw his chance to ask the question that had been on his mind. “My friend told me about an investment opportunity; MMM, that would be more like capital gains rather than cashflow, right?” 

“I wouldn’t recommend a system like MMM. It sounds very similar to a Ponzi scheme” 

“Chief, please, what is a Ponzi scheme?”

“It is an investment scam that uses the money from new subscribers to pay off the earlier ones. It usually promises impossibly high returns and there is not really a clear line of sight to how the value that brings those high returns is created. Some people make money but it’s very risky. The scheme collapses eventually and takes a lot of people’s money with it”

 “Tufiakwa!” Emeka said, snapping his fingers over his head. “Nothing wey butcher no go see for goat belle” He shook his head sadly as he thought of Segun who had sold everything he had, only to be caught up in a scam.

“Indeed” said Chief. “There are too many charlatans eager to part you and your money. Don’t make it easy for them. Guarding your money from loss is important to making it grow. If, Warren Buffet, one of the richest men in the world, who can afford to lose a little here and there, says that the most important rules of investing are “Number. 1: Never lose money. Number. 2: Never forget rule Number 1.” Then all of us who have way less had better guard our money from loss. Ensure you investing under the guidance of professionals and even then, ensure you understand what you are getting into. If the investment cannot be explained in a way you understand and it is not clear to you where the value is being created and exchanged, its best you don’t get involved” 

“That being said, when you do spot a good opportunity, move quickly to take advantage of it. Opportunities have a limited lifespan but fret not, just like passing ships, good ones will always come around again”