Bad Financial Decisions for Entry Level Employees

Bad Financial Decisions You Make As An Entry Level Employee

Nairametrics on September 15, 2016

There are very few things in life that is as satisfying as getting a job soon after graduating from University. As such, it isn’t strange to see an entry level employee suddenly feeling as though they have ‘arrived’ and can now enjoy all the “good things” that come with life.

Unfortunately, we all have limitations in life which make our wants are always limited to choices. It is why no matter how much we earn it is never enough to cater for all our needs.

Whilst your newly earned salaries puts you at the start of financial independence, there are certain financial decisions you may be tempted to make that can put you quickly on the path of financial ruin and take away money that would have been better served for investment purposes. Here are some example;

Consumer Loans

The moment you pick up that plum job and start seeing your bank accounts swell, banks, shops, and businesses that offer all sorts of consumer products will approach you. In Nigeria, it is a given to be offered debit cards once you open a bank account. What follows next are credit cards and all kinds promos that makes acquiring things you need and don’t need pretty easy to acquire. For those who find it hard being frugal it’s the easiest way into financial ruin. You must try to avoid them except where necessary and start by learning to live according to your means.


Cars are an important aspect of life and as Nigerians, we depend on them a lot to commute and carry on with our daily livelihood. Due to the poor transportation network in the country, the choice of having a car makes this asset irresistible and far above our needs. Despite its importance, one needs to be smart about buying a car. For example, an entry-level employee need not buy an expensive car just because of the need to own a car. Because cars are very easily prone to upgrades a new car today can become relatively obsolete tomorrow.


I like cell phones a lot and I have used or bought most of the most popular brands around. However, I have made two important observations. One is that phones also get obsolete pretty quickly. The latest phone today can soon be a “has been” tomorrow. The industry is just so competitive phone makers fall over each other to release newer versions. This also leads me to my next observation which is that phones become cheap within a short period. A phone bought for N100,000 today can be worth N50,000 in a months time. Based on this, one wonders why people don’t wait till phones are cheap before you can buy them? The reason is probably that the phones are so very well marketed and advertised the lure to be the first to own them far outweighs the wisdom of owning the same product at a bargain.


Owning a home is mostly regarded as a fulfillment of one’s mission in life and an attainment of an important societal goal. That said, a house is not an end in itself and shouldn’t be considered as the most important thing in life. An entry-level employee has no business taking out a mortgage in the early stages of their careers. Rather than burdening yourself with debts early on, efforts should be directed at building up your investments. You can buy lands when the opportunity arises in the hope that the value rises in future and then use the capital gains as equity to purchase a property of your own. Also, living in neighborhoods associated with high rents should be avoided by all means as you begin your career. It does nothing more than eat into money meant for investments.

Entry Level employees

Computer and Gadgets

Everyone needs a computer and gadget in this modern world of ours. However, just like Cellphones computers, tablets and gadgets are easily replaceable and cost less over a very short time. Computers for example range between N50,000 to N500,000 and all can relatively perform basic computing functions. Tablets are even worse as they cost more and are suboptimal when it comes to core computing functions, however, people spend a lot on these items As a fresh intern, what you need is to get yourself a basic gadget that meets your immediate need at the cheapest of prices.


Fashionable items are an irresistible part of life and tend to consume a huge portion of our income. As an Intern or Freshly employed, been fashionable ought not to be a priority. I made that mistake myself and spent a lot trying to look good all the time. However, each time I invested so much in looking good a new trend is quickly ushered in and soon my expensive wears become obsolete as well. Looking back, I realized all I needed was just something nice, basic, time-tested and cheap. I need not spend that much wearing the latest when after all I could have still done that now that I am older and better financially secured. The lesson is that fashion is not running away and would always remain par of humanity. Therefore, if you are out of it today you can easily catch up tomorrow.

Expensive Vacationing

It’s great to enjoy a vacation once in a while even as a fresh recruit. Just like above, vacation hot spots are there forever and so, if you miss going on vacation this year, you can still get the same fun next year. If you must go on vacation, make sure it is a destination you can afford. It is, however, more important to base your decision to go on vacation on how far you have come in your investment life.  Only go on expensive vacations after you have met youth investment goals and when you can afford it.

This article originally appeared on Nairametrics on the 28th of November 2013

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