7 Smart Budgeting Strategies for Low Income Nigerians in 2025

For as long as I've been alive, Nigeria has had a finance problem. From low earnings to consistent rises in inflation, the mix of challenges in the country have negatively affected personal financial management for workers.

As of now, there is no middle class in the country. It's either you're stinking rich or barely surviving. No in between. Most people use all or most of their earnings on food and transportation, barely leaving anything to save or invest and of course, this impacts the rising cost of living.

While the citizens cannot control the inflation, we can control how we manage our money. That is where budgeting comes in.

Knowing how to plan ahead for your money puts you ahead in your daily expenditure, and keeps you informed about where your income is going.

So, how do you go about this?

1. Understand Your Income - How Do You Get Money?

A lot of Nigerians have side hustles, ranging from freelancing and purchasing businesses, to even gifts from relatives and partners.

As at January 2024, over 60% of the country's population had two or more streams of income. With the rising cost of things, this percentage would have definitely increased but most people don't pay attention to how much they really make in a month.

As a strict budgeter, one thing I advise people to do is detail out all the money they make in a month. Whether it's from an 8-5 job, freelancing, buying and selling, or even gifts - it's important to know how much comes in every month.

Of course, this isn't always a fixed amount because of how unpredictable things can get. Still, an average over three to six months can be obtained to show how much you make in that period.

From there, you can move to the next step.

2. Track Your Expenses - Where Does Your Money Go?

Now that you have an estimate of how much you're making monthly, it's time to see where your money goes. Take out a month and categorize your spending habits into essentials and non-essentials. Basically, your needs and wants.

Essentials:

• Housing
• Food
• Transportation.

You can't do without those, so it's non negotiable spending.

Non-essentials: 

• Dining out
• Trips
• Impulse purchases
• Entertainment

I know a lot of people classify a lot under essentials like data, clothes, and all of that - and it's fine. 

Everybody has their personal life so tweak this as you want, but just remember to be real and categorize fairly.

The importance of categorising your spending is for you to get a sense of how you spend money. Without this, you would never be able to budget effectively.

3. Set Financial Goals That Help You Save Faster.

Before you start budgeting and saving, it's important to know why and how you want to save. Set clear objectives on how you want to distribute your funds, the time periods and why you want to be financially independent.

• Are you saving for school?
• Relocation (japa) plans?
• A retirement plan?
• Your child's education?
• Do you want to buy a house or a car?

The reasons for saving are limitless, but yours should be a daily motivation factor to save.

If you're someone with multiple goals, then rank them in order of importance.

Which one do you need to accomplish first? Prioritize the most urgent one and start working on it.

How much do you need? Set target amounts and allocate monthly savings towards these goals to help you reach your target faster.

Use that to plan yourself and make monthly deductions from your salary.

4. Make a Realistic Budget - Can 50/30/20 Work in Nigeria?

Everyone knows the 50/30/20 rule: 

• 50% to needs
• 30% to wants
• 20% to savings and loans

But will it work for you?

If you're someone who is ready to be strict with a savings plan, you can always do 50/20/30. If your needs aren't so high or are taken care of, you can adjust to 30/30/40 or however you want.

The goal here is to plan an effective way of budgeting that helps you save enough for your goals, while keeping you alive and happy.

Let me show you a practical example:

If you make N100,000 in a month, you can budget it like this:

• ₦50,000 goes to essentials (food, transport, rent)
• ₦15,000 goes to wants (entertainment, data, and other expenses)
• ₦20,000 is for savings
• ₦15,000 is for emergencies

That's 50/15/20/15. 

Personally, I like to make my budget rule 20/25/45/10 - and that's because most of my essentials are covered. Naturally, everyone's budgeting plan will be different but the most important thing is to be practical.

I always advice people to add emergencies to their budget plan. Life happens. Accidents, weddings, and all that. Most of the time, you don't have a choice but to spend so why not keep some money aside for the rainy days?

5. Manage Your Debt:

If you're not in debt, congrats! You can skip to the next number. This is for those who also need to factor in loan repayment plans in their budgeting.

As a natural rule, you should already have a sure way of paying back a loan, even before you take it. Still, most people just decide to wing it and that can end badly.

To avoid that, your first step should be to list out all you owe. It's a surefire way to build clarity and direction on the next steps to take.

After sorting out your needs, a loan repayment strategy should be next on the list. Understand the financial obligations and have a plan to work towards it.

Unfortunately, that could mean letting go of some needs or not having any emergency savings, but it is important to pay debts off so you can start with a clean slate.

Your repayment plans could either be paying the loan(s) off but by bit, till it's done or paying off the largest one and working your way to the least expensive debt.

Whichever way is fine, but the most important thing is to be debt free.

6. Invest Something - Even as Little as N1,000.

Fun fact: I invested N7,000 in 2022, and now it's over N15,000. I know it doesn't seem like much, but it's basically times two of what I put in. 

Imagine if you invest N50,000 or more. Your rewards will be massive.

Just like saving, investing is a good way to build up your income, but better. You put your money into something that is guaranteed to bring earnings, and watch your money grow. The more you put in, the more you get.

The sad reality of this is that not a lot of Nigerian banks do this, and even if they do, the returns are little. I know many Nigerians avoid investing online because of scams, but safe investment platforms do exist. These apps give you the chance to invest as low as N1,000, and I'll list them in the later parts of this article.

If you're someone that's just starting out as an investor, it will be good to watch YouTube videos to get a general sense of it. You can also follow pages like MoneyAfrica on Instagram to get ideas on how to save and invest.

Two general rules to note:

Never invest money you cannot do without. It should always be money that is dedicated to savings, or free earnings.

Before investing, check if the company is licensed by the SEC Nigeria, and always start with small amounts.

7. Stay Informed:

It's not just enough to save, invest and budget your life effectively. The dedication and readiness to learn is also important too. Continuously find ways to upgrade your income, whether by finding low risk loans, joining local cooperative societies or building your skillset.

One thing I like to do every half year is revise and modify my budget, especially if my earning capacity has increased or reduced. Adjusting your budgeting strategies makes room for growth, and helps you understand what is happening with your money.

***

Still here? Let me give you a practical example that worked for me when I first started budgeting.

In 2022, I earned N100,000 as an intern pharmacist. 

Housing was free, no transport, so I only had to spend on food and data which was about N50,000 monthly. The rest, I wanted to save it.

So immediately the alert entered, I withdrew N35,000 first and saved by splitting it into different accounts. A long term plan, an emergency deposit, and a dollar account.

The remaining N15,000? That was my "spending anyhow" money. Maybe, it wasn't my wisest decision but it was also practical.

***

Honestly, it's tough and nearly impossible to be super strict with savings, especially as a Nigerian living in Nigeria. The main thing is to be consistent and dedicated to saving and investing a particular amount.

Do you know the joy that comes with seeing your saved/invested money? I do, and I want you to have that experience too. So, I'm going to share some of the apps I have used so far that have worked for me.

Saving, Investing and Budgeting Tools for 2025

1. Cowrywise
2. Piggy Vest
3. Risevest
4. Afrinvest
5. Bamboo
6. Monefy
7. Alat by Wema

The best part about these apps is that you can save for short and long term goals, do automatic saving plans and even invest in dollars!

They also offer the option of saving daily or weekly, which is usually automated. Once you set it up, you'll be waking up to debit alerts but that should fill you with joy. It means you're saving good.

Budget well in 2025, and watch your money work for you.

Are you using a budget? Share your thoughts and ideas in the comment section below.

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