‘Population with weak purchasing power is a liability, not an asset’

As the purchasing power of the vast majority of the population weakens, financial experts have expressed worry about the challenges such a situation poses to the country, rather than the opportunities such a population offers.

At the second edition of Cordros Summit with the theme: “Wealth Revolution,” financial experts explored innovative strategies for transferring wealth to Generation Z, as the demographic begins to come of age and accumulate wealth.

Industry professionals shared insights and strategies tailored to the unique financial behaviors and expectations of Gen Z, ensuring that wealth transitions smoothly across generations.

The event equipped participants with the knowledge and tools needed to navigate the complexities of growing, preserving and intergenerational wealth transfer in today’s rapidly evolving financial landscape.

Speaking on ‘Nigeria’s Economy Outlook’, the Chief Executive Officer, The CFG Advisory, Tilewa Adebajo asked, is Nigeria’s population an asset or liability? Responding to his poser, he disclosed that any population that does not have purchasing power is not an asset but a liability.

According to him, whatever wealth we are managing in Nigeria today is clear that, the level of our financial inclusion is a challenge, stressing that Nigeria’s biggest problem today is that of physical management.

“During the global financial crisis of 2008, it was the prudence in our fiscal planning that helped Nigeria navigate through the challenges of that period but what we have today is different from what we have at that period and that’s simply what is responsible for what we are passing through today.

“We have consistently followed the path of bad fiscal management to destroy our value. How do you grow, preserve and even transfer wealth in an environment with bad physical management?” he added.

The keynote speaker, Chief Executive Officer, Globus Bank, Elias Igbinakenzua, who said research has shown that there’s about $90 trillion to be transferred to the next generation, the majority of whom are Gen Zs in the next 10 years, noted that the Gen Zs are thinking digital; “they are not like what we used to know in time past, we must move with their thinking and create a framework that will sustain that wealth when it’s transferred.”

According to him, “Today, we have over $1 trillion in market cap in digital assets and if we don’t understand how that works and impacts the economy we will be on the losing side because the Gen Zs are thinking global. We that will transfer the assets to them must think global, if we don’t do so, most of them will flee from our midst to the global realm.”

Continuing, he disclosed that the transfers must be relevant and transformative and any player that wants to succeed in this transformation must embrace technology/digital. He emphasised that players must take regulations and cyber security issues seriously, hence, the need to put mechanisms in place to safeguard their customers.

Also, he said that the greatest revolution in wealth creation is what technology has done today, stressing that, historically, the old folks believed that the whole idea of wealth creation was about physical assets but today, that has changed.

“Wealth managers and wealth creators must pay keen attention to digital space because the world is moving in that direction and understanding the dynamics of the digital space will be of great help to them,” he remarked.

He further pointed out: “That’s why the people saddled with the responsibility of our physical management must ensure that they give hope to the Gen Z that this country is worth investing in.”

While giving the meaning of wealth, the financial expert stressed that wealth is the process of making assets, investments and resources over some time, usually, it starts from the age of eighteen, adding that, it’s also the art of science of managing your financial resources for a comfortable future which include good health and affluence.

He continued that before you start any investment, you must evaluate comprehensively how you want your future to look like, noting that one thing that worked against people in their journey of wealth creation is the lack of proper planning.