A diversified financial portfolio gives investors options in case of economic fluctuations. By investing internationally and locally, your finances will have alternative sources of stability. Many people are buying dollars in Nigeria now to keep due to the high exchange rate. Still, our advice is to never solely invest based on exchange rates as a country’s currency can drop in strength overnight. Fluctuations in currency strengths can just as quickly work against your portfolio as they can strengthen it.
According to the 2020 World Economic Outlook report, the United States’ growth will moderate from 2.3 percent in 2019 to 2 percent in 2020 and decline further to 1.7 percent in 2021. According to the International Monetary Fund, the United States is projected to fall below the rest of the world for the next two years when it comes to economic growth. At the same time, Nigeria’s real GDP growth is projected to rise to 2.9% in 2020 and 3.3% in 2021. That shows that buying dollar notes to keep is not an ideal way to protect your money. Nigeria has many opportunities to transform its economy, particularly in agro-processing.
Investment is crucial at this time, and one of the best ways to secure your money is through real estate investment. People buy a house either for self-occupying or to earn rental income and capital gains. But the home that you live in is for self-consumption and should not be mistaken as an investment.
The appreciation in the prices of house property depends on various factors such as size, age, and location. The property’s location is the single most crucial factor in determining the value of your property and the rental income that it can earn. Investments in real estate deliver returns in two ways – capital appreciation and rentals. Before investing in property, evaluate based on safety, liquidity, and returns.
Understand that a bank fixed deposit may be considered a comparatively safer choice for investing in some countries, including Nigeria. However, it is now a less lucrative investment option in Nigeria due to the low-interest rate. In comparison, the returns on real estate investments are still quite high, and it gives an investor access to steady cash flow.