E-Financial
FBNQuest Asset Management Discusses ABC of Personal Finance Part 2
Ability to Take Risk
This is your financial capacity to take risks. It depends on factors such as your income, savings, financial obligations, and investment time horizon.
For example, higher income and substantial savings can increase your ability to take risks, high debt levels or significant financial responsibilities (like supporting a family) can reduce your ability to take risks, the longer your investment time frame, the more risk you can typically afford to take, as you have more time to recover from potential losses.
Balancing Willingness and Ability
Effective financial planning involves balancing your willingness and ability to take risks. Here are a few steps to consider: Assess Your Risk Tolerance, Evaluate Your Financial Situation, Diversify Your Investments and Adjust Over Time.
Understanding your willingness and ability to take risks helps you make informed investment decisions that align with your financial goals and comfort level.
- Liquidity Needs
This refers to how quickly and easily an asset can be converted into cash without significantly affecting its value.
Liquidity need is the requirement to have access to cash or easily convertible assets to meet short-term financial obligations or unexpected expenses. While liquid assets offer safety and flexibility, they typically yield lower returns compared to less liquid investments.
Balancing your portfolio to meet both liquidity needs, and long-term growth goals is essential. Understanding your liquidity needs ensures you have the right mix of assets to meet both immediate and future financial goals.
- The investment duration
This directly influences the investment objective. In essence, the longer the investment horizon, the greater the potential for risk and reward.
However, it’s crucial to align the investment duration with the investment objective to achieve financial goals effectively.
Short-term objectives: Investors typically seek investments that offer liquidity and stability. Examples include money market funds, certificates of deposit (CDs), and short-term government bonds.
Medium-term objectives: These investors often balance growth and income. They may consider a mix of stocks, bonds, and mutual funds.
Long-term objectives: Investors with a long-term horizon can tolerate higher risk for potentially higher returns. They may invest in stocks, real estate, and other growth-oriented assets.
Example: A young investor aiming to accumulate wealth for retirement (long-term objective) might invest in stocks, which historically offer higher returns over the long run while an investor nearing retirement seeking steady income (short-term objective) might prefer bonds and dividend-paying stocks.
- Understanding Various Investment Vehicle
An investment vehicle is a financial product or account that allows individuals and institutional investors to invest their money with the aim of generating profit or returns. These vehicles come in various forms, each carrying its own risks and rewards.
The best investment vehicle for you will depend on your individual circumstances and financial goals. Consulting with a financial advisor can help you make informed decisions. Here are some of the most popular investment vehicles:
- Stocks: A type of investment that gives you partial ownership of a publicly traded company. Such ownership entitles you to any dividends that may be paid, and you may experience gains or losses on your holdings over time. Potential for high returns but higher risk. E.g. shares of FBN holdings.
- Bonds: A debt instrument, a bond is essentially a loan that you are giving to a governmental entity or a company in exchange for a pre-set interest rate. Typically, the bond pays periodic interest (coupon payments) during its term, and it matures on a specific date. Steady income but moderate risk.
- Mutual Funds: An investment vehicle that allows you to invest your money in a professionally managed portfolio of assets that, depending on the specific fund, could contain a variety of stocks, bonds, or other investments. E.g. FBN Money Market Fund.
- Exchange-Traded Funds (ETFs): Like mutual funds but traded on stock exchanges, offering more flexibility and potentially lower costs.
- Real Estate: Investing in physical property, such as houses, apartments, or commercial buildings.
- Derivatives: Financial contracts based on an underlying asset (e.g., options, futures). This is also a high-risk investment.
- Commodities: Physical assets like gold, oil, or agricultural products.
Other consideration when choosing an investment vehicle
- Diversification benefit Fees and expenses Reputation of the Financial Advisor
- Stay Informed & Continuous learning (A way to take ownership of your finances)
Certainly, improving your financial literacy is a valuable endeavour that can empower you to make informed decisions and better manage your personal finances.
Remember, continuous learning is key to improving your financial literacy. Here are some effective ways to enhance your financial knowledge:
- Read Books and Magazines Visit Financial Websites
- Attend Local Presentations/Webinar Seek Expert Advice
Common Investment Mistakes
Here we highlight the past mistakes people have made while making an investment decision.
The aim is to prevent us from doing same and better equip ourselves to make better investment decisions. Investing is a journey, and learning from missteps can lead to better outcomes.
- Not setting financial goals Not diversifying
- Not learning from your mistakes Not doing your research
In conclusion, monitoring and reassessment are crucial components of successful personal finance management. It is not just enough to execute the actions above; it is important to imbibe the culture of discipline to achieve your financial objectives.
Remember, the journey to financial well-being is a marathon, not a sprint. Stay committed, stay informed, and your future self will thank you.
The Senate on Wednesday adopted the harmonised conference committee report on the four tax reform bills.
The resolution of the Senate followed its consideration and approval of the recommendations of the conference committee of both chambers set up to harmonize the Bills.
The Chairman of the Senate Committee on Finance and leader of the Senate delegation in the conference committee, Senator Mohammed Sani Musa, presented the report.
The four tax reforms Bills which were transmitted to the National Assembly in November last year by President Bola Ahmed Tinubu include: The Joint Revenue Board (Establishment) Bill, 2025 (SB. 583); Nigeria Revenue Service (Establishment) Bill, 2025 (SB. 584); Nigeria Tax Administration Bill, 2025 (SB. 585); and Nigeria Tax Bill, 2025 (SB. 586).
In recognition of its exceptional contributions to innovative financial solutions for Micro, Small, and Medium Enterprises (MSMEs), Fidelity Bank Plc has been awarded the 2025 Development Bank of Nigeria (DBN) Innovation Award in the Deposit Money Bank (DMB) category.
This prestigious accolade celebrates Fidelity Bank’s commitment to addressing the unique challenges faced by MSMEs, a vital segment in Nigeria’s economic growth.
Dr. Nneka Onyeali-Ikpe, MD/CEO of Fidelity Bank Plc, commented on the award, reaffirming the bank’s dedication to empowering Nigerian entrepreneurs: “At Fidelity Bank, innovation is at the heart of our strategy to support MSMEs.
“This recognition underscores our commitment to developing scalable, inclusive, and technology-driven financial solutions that create positive outcomes for our nation’s entrepreneurs. We are honored to receive the DBN award and dedicate it to our loyal customers for their continued support.”
The award was presented at the 2025 Service Ambassadors’ Awards ceremony in Lagos, themed ‘Enhancing Partnership for MSME Resilience and Growth.’ Tony Okpanachi, Managing Director of DBN, emphasized the importance of financial institutions in transforming unbankable ideas into viable businesses through advisory services.
“You, our partners, are acknowledged and celebrated for your outreach to entrepreneurs and businesses seeking to scale. We appreciate you for your role in converting unbankable ideas into bankable businesses,” Okpanachi stated.
He noted that the award aims to recognize partners who make a significant impact, focusing on storytelling and the positive changes they bring to Nigeria.
This award joins a series of landmark initiatives by Fidelity Bank aimed at supporting MSMEs. Earlier in May, the bank signed a Memorandum of Understanding (MOU) with the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN) to facilitate the expansion of Nigerian MSMEs across Africa.
Additionally, Fidelity Bank launched the Fidelity SME Hub in Gbagada, Lagos—a multifunctional facility equipped with training halls, meeting rooms, networking spaces, and studios for music, photography, and content production.
This hub is designed to foster innovation, collaboration, and capacity-building, essential elements for strengthening Nigeria’s SME ecosystem and driving economic growth.
Ranked among the best banks in Nigeria, Fidelity Bank Plc is a full-fledged Commercial Deposit Money Bank serving over 9.1 million customers through digital banking channels, its 255 business offices in Nigeria and United Kingdom subsidiary, FidBank UK Limited.
The Bank is the recipient of multiple local and international Awards, including the 2024 Excellence in Digital Transformation & MSME Banking Award by BusinessDay Banks and Financial Institutions (BAFI) Awards; the 2024 Most Innovative Mobile Banking Application award for its Fidelity Mobile App by Global Business Outlook, and the 2024 Most Innovative Investment Banking Service Provider award by Global Brands Magazine.
Additionally, the Bank was recognized as the Best Bank for SMEs in Nigeria by the Euromoney Awards for Excellence and as the Export Financing Bank of the Year by the BusinessDay Banks and Financial Institutions (BAFI) Awards.
United Bank for Africa (UBA) Plc, Africa’s Global Bank, has launched a new feature called Advance Top-Up on its USSD banking platform *919#, which is designed to provide instant access to airtime and data for its customers especially when they are out of call credit or disconnected from the internet.
The new feature which was unveiled at the UBA head office in Marina recently, allows customers to borrow airtime or data directly from their mobile devices, offering a fast, dependable solution.
Shamsideen Fashola, group head, Retail and Digital Banking, UBA, who spoke during the official launch, described the feature as a timely addition to the bank’s digital offerings and a testament to the its customer-first approach.
“At UBA, we are constantly looking for ways to make banking and everyday services more accessible for our customers. With the launch of Advance Top-Up on our USSD platform, *919#, we are giving our customers the power to stay connected without interruption, regardless of time, location, or airtime balance,” Shamsideen said.
UBA’s Advance Top-Up which is now live on *919#, joins a wide range of services on the platform, which include airtime and data purchases, money transfers to UBA and other banks, account balance checks, card blocking and freezing, online transaction controls, bill payments, and more.
Fashola emphasised the simplicity and convenience of the solution, adding that “You don’t need to download an app or visit a data centre. Just dial *919#, follow the prompt, and you’re immediately connected. It’s simple, fast, and reliable.”
Alero Ladipo, Bank’s Group Head, Marketing and Corporate Communication, added that the feature was developed based on real feedback from customers and their evolving needs.
“Our users asked for a way to stay connected when they have no airtime, and as always, we have come up with a quick solution, right there on their phones, instantly, with no fuss, and no need for internet connectivity. Whether for emergency communications or business continuity, *919# puts instant connectivity in every customer’s hands,” she explained.
She explained that only recently, the bank unveiled its newly improved Point of Sale (POS) Terminal as well as the UBA MONI App to redefine the digital payment landscape and empower small and Medium Scale Enterprises across Africa.
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