The POTENTIAL VII: Managing Debt
Around this time last year, I was owing NEPA some thirty thousand naira; today, NEPA owes me some twenty-five hundred. Funny, eh? As at when I was owing thirty grand, my neighbours prided themselves as the rich ones, and insisted that NEPA cut our light at the meter points (so they could retain their connections while I lost mine). One even scorned me the month I paid three out of thirty, she stood in the street and argued that I mustn't be spared. I came back to meet me disconnected. Well, she owes just as much now, a year later.
Truth be told, we all owe at one time or the other; even Dangote. Sometimes, as in my case, we owe because someone disappoints and we have to take responsibility. Either way, debts are easier incurred than settled. In fact, one often pays off one debt with the other; run in circles, never able to break out of the rat race. Luckily, there is a way to pay debts and stay afloat. The discourse that follows is not to make me out as some (arrogant) debt guru, but as someone who has seen, and conquered...
Perhaps the first step is to stop the increase.
NEPA brought a bill N1 200 more than the previous month's. I couldn't pay the whole bill, but I paid the N1 200. No, I didn't wait till I could afford the whole bill. The next month, the bill was N3 000 more, so I paid the three grand. And was mocked.
What my financially illiterate neighbour didn't know was that I coulda paid much more than i did each time, I just didn't. If I had, I'd have pushed myself to the brink of indebtedness just to save face. I saw the bigger picture. And those two months allowed me to prepare for the tough times ahead: stocked the house with food, planned for farm, be ready for the derogatory gazes of pseudo-rich classmates.
The next month I paid five thousand to see if I really could afford to divert my income into the debt. I needed to be sure nothing could come up to thwart my plans. I needed to be ready. (KINDLY READ Surviving the Times, by Ayk Fowosire.)
Third, crash your debt.
The next three months, I paid ten thousand successively; yes, thirty thousand! One would expect me to be off the hook by now, but not so. Each of those months brought bills of some three thousand... And of course I had to pay. But I'd crashed my bill. I'd established myself as smart, someone to be reckoned with – no more ah-better-pass-you neighbours.
Fourth, gradual decline.
If I paid another ten thousand, I'd settle the bill completely, but I would likely run into trouble. So I paid five thousand, and three, the following month, even though there was the temptation to pay ten and be done with it. Yet, I must not pay debt in a way that incurs another; I must not replace one debt with another.
Fifth, stay afloat.
The next months, I made sure I stayed in pace with my debt. It is only so natural to want to relax, to want to do something else with money. But don't! Make sure you pay your debts as they come.
Luckily I qualified for zero-reading, having paid more than I'd legitimately consumed, so that my bills for the next three months hovered around six hundred and fifty naira per month. Yet, rather than ignore them as insignificant, I paid them off, and quickly too. They are the little foxes that destroy the vine.
Sixth, stay ahead.
Actually, while NEPA was billing 650 I was paying a thousand. Debts accumulate easily, one reason they are so difficult to be rid of. So, to take care of the little foxes one must get ahead of them, and stay there. And it feels good to be. Imagine getting a bill less than N100, not because your consumption is so little, but because you had paid in advance! Now I calculate my consumption and pay before the bill comes.
That way, I'm not afraid of the future, of whether Buhari wins or interim government run by the now partyless Obj is formed. Wealth is a mind set. You can have it. Just decide... And, in the next episode of The POTENTIAL, let's buy land!
Remember, defeating indebtedness begins with not spending to your capacity, leaving a little extra here and there, plugging the holes. Only spend what is necessary. No one knows tomorrow. By the way, each of us now has his connection to the NEPA pole. That way, no one feels super rich, or better pass. Luckily, the chronic debtor now leads the pack. Funny, eh?
Remember, you will be mocked, maybe even unfriended. I personally have learnt to use these times of palpable uncertainty, and perceived weakness (even helplessness), to sift out good friends. You would be surprised at how few those can be, especially when you are both unpopular and under attack – everyone wants to take a quick jab; how disappointed they are when they realise one is not so helpless after all.
Remember, your wealth begins with you. Debt can be a friend. So, keep your enemies close, and your friends closer. The scorner left, by the way, when the debts began to drown. Lesson? Don't look down on us poor folks, a lot of us are wealthier than you (can) imagine... Animals feign death to recover strength to escape, it's instinct.