Are you struggling with debt? These tips have a 99% chance of working 

A lot of people get into a little financial hiccup and to fix it they look for a means of getting a loan, borrowing from family and friends, etc.

However, they soon realize that this one debt may lead to another and then another creating this never-ending debt cycle.  

This is often the case because the problem that “arose” may merely be a smokescreen. The problem may be more deeply rooted in poor personal financial practices which would be discussed later in the article.

Not only does debt cause unnecessary stress, but it can also cause strain in relationships if repayment of the debt is delayed or cannot be met. 

According to reports, no fewer than 173 loan apps have been approved in Nigeria. This shows the high demand for loans from as many Nigerians have embraced the quick fixes, they offer despite their outrageous interest rates.

These loan apps offer loans between N5000 and N300000 and may charge interest rates of more than 15% per month!  

It is pertinent to mention that debt in itself is not a bad thing. Debt financing is a major source of corporate financing.

Most companies take huge amounts of debt in the form of loans and issuing bonds. For example, the Dangote Group reportedly took loans to the tune of $9 billion to build its recently commissioned refinery.

The deciding factor between good and bad debts lies in the reason why the said debt was collected. Would the debt be used to generate revenue? Is there a solid repayment plan in place?

These are some of the questions intending debtors must ask before taking debt. 

Reasons why people go into debt and how to deal with it 

As unfortunate as it sounds, life may throw tantrums at us that we least expect. For example, we may come down with an illness and we may need to go into debt to seek medical care.

These medical bills may be more than what we have in our bank accounts and puts a lot of people in a sticky situation.

Another such occurrence is a layoff. Job security is gradually becoming a myth as even the traditionally safe occupations like giant tech companies have seen massive retrenchment especially post-pandemic. 

  • Dealing with unforeseen circumstances 

Financial experts advise that even when everything is rosy and there isn’t any sign of danger, we should put away some of our income aside in what is called an emergency savings account.

This savings account is specifically meant for emergencies and unforeseen circumstances that require funds and fast.

If you have a substantial emergency fund you may not need to turn to borrowing or at the very least you would only require just a small percentage to cover them. 

  • Poor personal finance  

According to the Nigerian Bureau of Statistics inflation in Nigeria hit 22.41% in May. Remember that most of our inflation is measured using the consumer price index CPI which tracks the prices of consumer items.

Many Nigerians fail to realize that we are living in dire economic times and even simply maintaining your spending habits from say 2021 may be “self-sabotage”.

Most people who run into debt are those who fail to adapt and take into consideration the current economic realities. 

  • Fixing up your finances  

Fixing your finances wouldn’t be easy. If you have been “keeping up with the Joneses” at the expense of your finances, you may need to backtrack and go back to the drawing board.

A budget is almost compulsory in these times as you want to track your expenses and do away with unnecessary expenses.

You may also cut back on luxuries like fueling several of your vehicles, frequent outings and throwing off occasions. You may need to cut the proverbial coat according to your size! 

You may have run into huge debts trying to finance your business and are currently at your wit’s end. This may not be a direct fault of yours as even the global economy itself hasn’t been so conducive.

However, what you do not want is having creditors at your neck as this could lead to confiscation of your assets. 

  • Dealing with business debts 

With business debts, you may need to look inwards. Consider cutting business expenses like staffing, unnecessary expenses, and other leakages. These funds can be rechanneled into debt financing.

Other options include leasing or renting some of your equipment in the interim to raise more capital and also looking at equity financing or potential investors. 

 Finally, debts aren’t a bad thing but should be considered only as a last resort. It is also very important that you understand the terms of the loan or credit being offered.

Accumulating debts with ridiculous interest rates will only compound your debt crisis quickly. If you must take loans look for those with favourable conditions and repayment options. 


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