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COVID-19 exposes Nigerians’ poor savings culture




The coronavirus pandemic lockdown brought certain facts home on the way we live and plan for the future. It was glaring while the lockdown lasted that most people did not prepare for any emergency that could demand they being unable to work for their livelihood. This, more anything else contributed to the challenges of ensuring full compliance with the lockdown as many people were compelled to move out to fend for their daily sustenance.

BusinessHallmark went to town, visiting Agege, Ikeja, Sango-Ota and Oshodi in a random sampling of people with the question: “Did you have up to N100,000 in your account at the beginning of the lockdown?” Of the 40 people interviewed, 34 said ‘No’.

From the interviews and the playout of events following the lockdowns resulting from the ongoing COVID 19 pandemic, it is clear that Nigerians do not have emergency savings.

On how they have been coping, most families spoken to by this newspaper said it had been tough as they have been living from hand to mouth, with many claiming huge indebtedness to foods stuff sellers in their neighbourhoods.

Mr Johnson’s family who resides in Agbado -Ijaiye told this newspaper how his family has suffered because of the lockdown.

“My brother, I am a mechanic, my workshop is at Idowu Taylor in Victoria Island. Honestly, I regret so many things I have been doing. I womanise, drink to stupor but at the beginning of the lockdown I had only N30, 000 in my account.”

He said his wife is a full-time housewife and with seven children the whole burden of taking care of the family falls on him.

“You know we rely on what I make daily for feeding and to meet other expenses. We live in a one-room apartment. When the lockdown started, I withdrew the money for family needs. When the foodstuff finished after a month, we have been seeing hell.”

Johnson family story is not different from Mrs Oladimeji, an Agege resident. A private school teacher on a salary of N15,000 a month, and for a woman who’s separated from her husband, tough would be a mild word.

” At times, we eat once in a day, because at the beginning of the lockdown I had no savings, in total I had just N10,000 with nowhere to go. I left my husband because he was irresponsible and a wife-beater, since our separation, he has never shown any concern about his children”, she said.

She told this newspaper that when her foodstuff finished, she convinced three wealthy families to let her take care of their laundry to survive.

Many who spoke to this newspaper rendered heart-rending experiences of suffering under lockdown.

The pandemic has taught a lot of lessons, though we are still grappling with the effects of it; it may not be too early to begin to take stock and find out what we did well during the pandemic and what we should have done better.

We know that the successive governments, worse still, the current one, would not be bothered about the condition of the citizenry. The type of government we have in Nigeria should not have left anyone surprised at their response to the pandemic, especially when it came to the welfare of the populace. What do we expect from a government that is dysfunctional, at best?

The playout of events following the lockdowns caused by the ongoing COVID-19 pandemic shows that Nigerians do not have emergency savings. This low savings culture is embedded in our psyche, with many saying our earnings are barely enough to feed our families.


In a recent publication by the Punch Newspaper, “Barely one month of a lockdown of Abuja, Lagos and Ogun state, millions of Nigerians had become stricken with hunger. Many could not bear an extension of the movement restrictions.” The ensuing protests were indicative of the fact that many Nigerians were living off their daily incomes with no savings to fall back on.

Poverty Level

The argument is that the low level of earnings cannot allow for savings. They have said repeatedly that how could they save without having funds, to begin with. Agreed, the level of poverty is high in Nigeria; however, we should know that having savings is not a luxury, but a necessity. It does not have to be large, but putting aside something, no matter how small regularly goes a long way in times of emergency.

Savings, as we know, is not rocket science, and definitely, there is no hard and fast rule of how much one should have in emergency funds. There seems to be an agreement among financial analysts and planners that having the equivalent of six months’ expenses in your emergency savings account is the ideal.

It is important to just put aside something from little you earn monthly and if you are artisan, say, roadside mechanic, set aside from your daily earning. You may open an account or join a contribution society popularly called ‘Ajo’.

The author of the book “Richest Man in Babylon” stated it clearly that if you do not save, it means that you have paid everyone else but yourself.

Saving culture

Pay yourself first: In line with the instructions in “The Richest Man in Babylon,” when you receive your monthly salary or collect that sales proceed from your business, “pay yourself first” by saving at least 10% of your collections or salary. For the salary earner, set up a direct deposit account where the money would be taken out of your pay directly into a bank savings account. By so doing, you are forced to save.

Cultivate the savings habit: Make a habit of saving part of your earning, just as some of us have made a spontaneous purchase a habit which is ever bad, cultivate a positive habit of saving. Just as spontaneous buying is a habit, form the habit of saving. Do not see savings as putting aside the remnants (if any) after all your expenses. If that is your attitude to savings, then you fall into the group that pays everyone else but themselves.

We should know for sure that as long as we have the money, there will always be something that is going to demand that money from us. So if we refuse to save, the money will go into serving frivolities that are not important.

Remind yourself to save

If you are a salary earner who does not want to set up a direct deposit from your paycheck or you are a businessman or woman of any means, you can set up a savings reminder around the time you receive your salary or around your peak business time.

One website that can help us with this is With this website, we can send an email to ourselves to be delivered around the time we expect to receive our payor business income, reminding ourselves to save. Just like we set an alarm on our mobile phone, we can do so with a reminder to save. This will tremendously help us to make good use of the little we have, and if it becomes a habit, it will stand us in good stead in future.

Start Small ASAP

The Bible says that if we are not faithful with small things, how can we be faithful with larger things? Remember that we do not need millions to start saving, all we need is the will, the determination, and consistency. So, start small and start now, but be consistent. It is this consistency that will make us reap bountifully from our savings in future, as it is important to prepare for the rainy day which is bound to come in future.

Reduce your Expenses


As already noted, one of the reasons that people do not save is because their expenses keep increasing, even when income sources are shrinking. If you find yourself in that situation (and you surely will, at one point or the other), cut down on your expenses and make them fall in line with trends in your income. Avoid spontaneous, emotional and flamboyant buying. Buy out of need, not out of want.

Why it seems difficult to save

To a whole lot of people, it is difficult to save because they live in the now. This is what financial psychologists call scarcity of attention. This scarcity of attention stops people from seeing what is important and makes them see the urgent current expenses they need to cover.

One reason why it is difficult to save is that while the expenses keep rising (out of increased need and inflation), sources of income keep shrinking or stagnating. The good thing, however, is that we have the option to shrink our expenses in line with shrinkages in our income, but often we do not choose to do that. That is where the inability to save starts.


If there is any lesson, we learned from the sudden outbreak of COVID-19, it is and should be that emergencies happen, and efforts should be made to cushion the financial impact of such emergencies by preparing for them in advance through emergency savings


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