By: Olamilekan Oke
To invest means the placement of capital in expectation of deriving income or profit from its use or appreciation; financial investment is one of the ways of creating generational wealth and you can see this example by looking at the life of wealthy people. They do not only invest for themselves, but also for the future, their kids and their unborn grandchildren. These days, majority of us invest but only invest wrongly, without following the right procedures, which is why we fall for the Ponzi schemes branded as investment platforms.
When thinking of how to invest, the first question you should ask yourself is, “How reliable or genuine is this investment and what’s the future of this platform?” It’s no news that investing is a risk and life itself is a risk, but what matters is taking calculated risks. Many of these investment schemes comes up with almost a non-feasible ROI (return on investment). Imagine someone telling you that you’ll get 60% of your capital back in a matter of weeks. How logical is that? That is, if you invest 50k, you’ll get 30k within 2 weeks. What kind of business do these investment schemes invest into, to warrant them getting such money back within a short period of time?
Lately in 2020 and early 2021, a lot of investment companies crashed and a lot of people lost their ‘investment’. Most people were shocked when they woke up to newsletters in their mails; lives were lost and some have not still been able to suppress the shock that was experienced till date. These schemes with all their false and unrealistic promises have not only been able to scam people, but has also destroyed the fortunes of so many ambitious investors. Just this year, VGC, Rackstali and some other investment schemes crashed. Those who were able to get their money back were either the lucky ones or the non-greedy ones who only invested little, cashed out and never invested again.
These schemes have been designed in such a way that you get your first ROI as promised, which tempts you into investing both your capital and your profit into the scheme again. Yes, it is that deadly.
Why do people keep falling for this trap?
The thought was everyone has learnt their lessons through the MMM investment scheme, but reverse is the case as more people fall for these branded Ponzi schemes based investment platforms. What are the possible causes?
- Poverty: The rate of poverty is currently on the extreme in the country and from the look of things, life is getting things tougher as the day goes by. Nigerians are ready to make money the moment you present your plan to them as clean, clear and legal. You tell a broke man to invest 5k and he will get back his 5k in a week time with another 5k as ROI and you will see him fall for it.
- Ignorance: A majority of people are still ignorant about these schemes and a lot of Nigerians do not still have a fundamental knowledge about investment.
- Greed: You see, greediness is what made a lot of people fall for this trap. People cashed out million from MMM and still invested back the whole money into it, all in bid to make more money. A greedy person will still fall for another scam that comes their way.
What To Do As An Investor
- While investing, have it in mind that you’re doing a long-term investment; and long term dose not depict the next week of investment.
- Make adequate research about the scheme you want to invest in. This will make you aware of how long the company has been in existence and if it has a future prospect; invest well in established companies, mostly startups,
- Take calculated risks. it’s nice to take risk, very nice, but taking calculated risk matters because not all that glitters is gold.
- Lastly, invest in cryptocurrency. Crypto seems like the future although our government are blind to that. My advice to you reading this and planning on investing in cryptocurrency is that do not invest with money you need right now, or money you might need very soon. Invest with the money you feel you won’t be using for the next 5-10 years. If you do that, you won’t be bothered about the dip, because the dip will surely raise again.
Those little changes you leave in your account, you can use it to buy a coin with future. Coins like BNB, ETH and the likes. You can also invest in real estate. All these investment will make you go to bed with your eyes closed and they can even make you sleep well and reduce your panicking. It doesn’t mean all these are risk free, but to a very large extent, they are safe.