The Free Fall of The Naira: How to Protect Your Finances
Naira drops yet again!
In less than a week, we’ve experienced yet another drastic drop in value. As of last week, the naira was still valued at ₦622 to $1 in the peer-to-peer market, but just seven days later, the naira is at ₦644.
According to Nairametrics, naira in the peer-to-peer market depreciated significantly to a record low of ₦644.25/$1 in the early hours of Thursday, July 21, 2022, representing a 1.44% decline compared to ₦635.1/$1 recorded on Wednesday morning. This happened in a day.
The fall in the value of the naira has been consistent and, quite frankly, scary for Nigerians. This current exchange rate is the highest recorded in the unofficial market, according to Nairalytics.
How does this affect you?
Let’s take a break from the facts and bring this close to home. How does the devaluation of naira affect you?
It will trigger an increase in the inflation rate, which was at 18.6% in June. This will affect business owners who have to deal with increased costs of raw materials, rent, gas, utilities, etc.
But that is not all.
When was the last time you went to the market and you bought an item at the same price you bought it previously? Let me help you with the answer. It has been ages. Sadly, with this drop, the prices of domestic goods are bound to skyrocket again.
Not only that, this devaluation reduces your purchasing power. The value of the money you have in your possession reduces as the naira reduces in value.
How do you protect your funds and finances from the effects of devaluation?
The sad truth is that the devaluation of the naira affects a lot of things that we do not have control over—for example, the increase in the inflation rate and the prices of domestic goods.
While you might not be able to control the consequences of devaluation, you can protect your finances from taking a huge hit.
How?
- Convert your naira into dollars or a stablecoin
This is the first thing everyone should do after hearing the news. If the naira is losing value every day, then your money is losing value every day. The only way to stop this is to convert your funds to a stable currency like dollars or stable cryptocurrency.
Once that is done, the devaluation does not affect your funds. Your $1 remains $1 even if the naira drops to ₦1000 to $1.
Converting your naira to dollars is quite easy. All you have to do is download the Xend Finance mobile app and create an account. With the P2P service, you can easily exchange your naira for BUSD (dollars) right from the comfort of your home.
But you should not stop at converting your naira. Go ahead and save your money in dollars. Xend Finance offers up to 15% annual interest when you save in dollars.
So, while the naira keeps devaluing, not only are your funds protected, but you receive interest on your funds.
If that is not smart, then I don’t know what is.
2. Invest
With the inflation rate on the rise, this is the best time to grow your money so you can always be one step ahead of inflation. There are a lot of investment options: stocks, bonds, real estate, forex, etc. Whichever you choose, make sure that you are fully aware of how the investment works.
The promise of high interest shouldn’t be the only reason for investing. Do your research. Evaluate your risk tolerance and diversify your investment portfolio.
Take the first step…
The value of the naira keeps falling. You no longer have any reason to keep your funds in naira. Convert your naira to dollars today and earn up to 15% interest on your savings when you save in dollars with Xend Finance.
Are you ready to protect your funds from devaluation? Click here to download the Xend Finance app now.
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