Managing Limited Resources: Most Nigerian students operate on tight budgets from family support, part-time work, or scholarships. Financial literacy helps maximize these limited funds through effective budgeting, finding the best deals, and avoiding unnecessary expenses that could derail their education.
Avoiding Bad Money Habits: Many bad and addictive habits have huge negative impacts on the finances of young people. Gambling, substance abuse and penchant for high risk investments and Ponzi schemes affect students negatively. Financial literacy knowledge and skills will help equip and safeguard students to steer clear of those bad money habits and vices that can potentially ruin their financial future and sanity.
Cultivating Good Financial Habits: Financial literacy will inculcate good money habits like savings, risk management, budgeting and debt (credit) management into students at such early stage. These help build strong personal finance foundation in them in preparation for a future where they will make most of their financial choices alone and face the consequences.
Avoiding Financial Exploitation: Financial literacy helps students recognize and avoid common scams, predatory lending practices, or get-rich-quick schemes that often target young people, particularly those new to managing money independently.
Understanding Banking and Digital Payments: With Nigeria's rapidly growing fintech sector and digital payment systems like mobile banking and POS services, financially literate students can take advantage of convenient, often cheaper financial services while avoiding fees and scams common in digital transactions.
Entrepreneurial Preparation: Many Nigerian students start small businesses during or after university. Financial literacy provides essential skills for managing business finances, understanding profit margins, pricing products appropriately, and separating personal and business expenses.
Navigating Economic Volatility: Nigeria's economy experiences inflation, currency fluctuations, and economic uncertainty. Students who understand these concepts can make better decisions about saving, spending timing, and protecting their purchasing power.
Planning for Post-Graduation Transition: Understanding concepts like emergency funds becomes crucial when transitioning from student life to job searching, especially in Nigeria's competitive job market where securing employment may take time.
Building Credit History Early: Understanding how to responsibly use banking services and potentially access student-friendly credit products can help establish a positive financial foundation for future major purchases or business loans.
Family Financial Contribution: Many Nigerian students eventually become financial contributors to their families. Early financial literacy helps them balance personal financial goals with family obligations more effectively.
Investment Awareness: Understanding basic investment principles prepares students to make informed decisions about opportunities in Nigeria's growing capital markets, rather than falling victim to investment fraud or Ponzi schemes.
These skills become particularly valuable given Nigeria's economic environment and the expectation that university graduates will achieve financial independence relatively quickly after completing their studies.
This article was published by Project Azaland as part of our global financial literacy advocacy. If you found it useful, please share with your peers.
