Overall wealth is everything you own that has value (your total assets), while net worth is what you actually keep after subtracting everything you owe (your liabilities). Real-World Example: Imagine two people who both own a ₦500,000 house and have ₦50,000 in savings: Overall Wealth: Both have ₦550Read more
Overall wealth is everything you own that has value (your total assets), while net worth is what you actually keep after subtracting everything you owe (your liabilities).
Real-World Example: Imagine two people who both own a ₦500,000 house and have ₦50,000 in savings:
Overall Wealth: Both have ₦550,000 in total assets.
Person A (No Debt): Owes ₦0 on the house.
Net Worth: ₦550,000
Person B (High Debt): Owes ₦450,000 on a mortgage and ₦50,000 in loans (₦500,000 total debt).
Net Worth: ₦50,000 (₦550,000 assets − ₦500,000 debt)
The Takeaway: Overall wealth shows the size of your assets, but net worth shows your true financial health.
Well, the popular saying says, Never borrow or take a loan to start-up a business. For me, the saying in not 100% accurate. I would preferably say, Do not take a loan to start a business you have no knowledge about or without a market for it. Firstly, loan or borrowing funds can be from different soRead more
Well, the popular saying says, Never borrow or take a loan to start-up a business.
For me, the saying in not 100% accurate. I would preferably say, Do not take a loan to start a business you have no knowledge about or without a market for it.
Firstly, loan or borrowing funds can be from different sources. I will categorize into 2.
1. Family/Friend Loan
2. Institutions (Bank/Financing company)
Family/Friend Loan: This totally depends on past relationships, of which interest can also be included to the terms. One who understand how bank loans works can approach family/friend with a loan proposal stating the interest rate and repayment structure. Which can be legally back (even in court). Advantage – interest free or loan interest rate.
Institution (Bank): The interest rate is mostly high, which might not be too good for a startup business. But if the business is that which need equipment Banks like, Bank of industry could finance the machinery (Not sure of the terms). Collateral will likely be required.
Secondly, If it’s startup business you have to be sure you understand the business operations before thinking of getting a loan.
thirdly, do a market feasibility study. Do you have a market for the business, are there needs for your product, what advantage do you have against competitors already in the market.
Forty, paying the loan monthly won’t it have a negative effect on the business operations.
I you can carefully answer all of this. you would be sure if its a good option for you. Cause if you don’t have the funds to start but having other capitals (relationship, experiences) should be capitalize. Thanks
Here is the streamlined 4-step checklist to get your foodstuff business proposal approved: Executive Summary: Define the business model, target market (retailers, caterers, or consumers), and exact funding amount requested. Also, state if you have experience or knowledge in this regards because an iRead more
Here is the streamlined 4-step checklist to get your foodstuff business proposal approved:
Executive Summary: Define the business model, target market (retailers, caterers, or consumers), and exact funding amount requested. Also, state if you have experience or knowledge in this regards because an investor want to know you are not just testing idea but you have knowledge on operations.
Market & Sourcing Analysis: Show key commodity sources (farmers, bulk markets), target pricing, seasonal price fluctuation plans, and local demand.
Financial Model & Unit Economics: Provide a precise breakdown of initial inventory, transport costs, expected selling prices, gross margins per item, and a clear 3–6 month cash flow projection.
Risk & Security Plan: Detail your inventory storage strategy to prevent spoilage, strict cash-only sales policies to protect working capital, and the expected timeline for sponsor payback or profit distribution.
Lastly, to be perfectly good before submitting to an investor. I suggest you put all to writing then give a consultant/ an expert in business proposal writing to help revamp.
How Is Net Worth Different From the Overall Wealth a Person Has?
Overall wealth is everything you own that has value (your total assets), while net worth is what you actually keep after subtracting everything you owe (your liabilities). Real-World Example: Imagine two people who both own a ₦500,000 house and have ₦50,000 in savings: Overall Wealth: Both have ₦550Read more
Overall wealth is everything you own that has value (your total assets), while net worth is what you actually keep after subtracting everything you owe (your liabilities).
Real-World Example: Imagine two people who both own a ₦500,000 house and have ₦50,000 in savings:
Overall Wealth: Both have ₦550,000 in total assets.
Person A (No Debt): Owes ₦0 on the house.
Net Worth: ₦550,000
Person B (High Debt): Owes ₦450,000 on a mortgage and ₦50,000 in loans (₦500,000 total debt).
Net Worth: ₦50,000 (₦550,000 assets − ₦500,000 debt)
The Takeaway: Overall wealth shows the size of your assets, but net worth shows your true financial health.
See lessWhat Is the Cost of Producing One 800g Loaf of Bread in Nigeria?
Thanks
Thanks
See lessShould I Borrow Money to Start or Expand a Business in Nigeria?
Well, the popular saying says, Never borrow or take a loan to start-up a business. For me, the saying in not 100% accurate. I would preferably say, Do not take a loan to start a business you have no knowledge about or without a market for it. Firstly, loan or borrowing funds can be from different soRead more
Well, the popular saying says, Never borrow or take a loan to start-up a business.
For me, the saying in not 100% accurate. I would preferably say, Do not take a loan to start a business you have no knowledge about or without a market for it.
Firstly, loan or borrowing funds can be from different sources. I will categorize into 2.
1. Family/Friend Loan
2. Institutions (Bank/Financing company)
Family/Friend Loan: This totally depends on past relationships, of which interest can also be included to the terms. One who understand how bank loans works can approach family/friend with a loan proposal stating the interest rate and repayment structure. Which can be legally back (even in court). Advantage – interest free or loan interest rate.
Institution (Bank): The interest rate is mostly high, which might not be too good for a startup business. But if the business is that which need equipment Banks like, Bank of industry could finance the machinery (Not sure of the terms). Collateral will likely be required.
Secondly, If it’s startup business you have to be sure you understand the business operations before thinking of getting a loan.
thirdly, do a market feasibility study. Do you have a market for the business, are there needs for your product, what advantage do you have against competitors already in the market.
Forty, paying the loan monthly won’t it have a negative effect on the business operations.
I you can carefully answer all of this. you would be sure if its a good option for you. Cause if you don’t have the funds to start but having other capitals (relationship, experiences) should be capitalize. Thanks
See lessWhat Should I Include in a Foodstuff Business Proposal for a Sponsor?
Here is the streamlined 4-step checklist to get your foodstuff business proposal approved: Executive Summary: Define the business model, target market (retailers, caterers, or consumers), and exact funding amount requested. Also, state if you have experience or knowledge in this regards because an iRead more
Here is the streamlined 4-step checklist to get your foodstuff business proposal approved:
Executive Summary: Define the business model, target market (retailers, caterers, or consumers), and exact funding amount requested. Also, state if you have experience or knowledge in this regards because an investor want to know you are not just testing idea but you have knowledge on operations.
Market & Sourcing Analysis: Show key commodity sources (farmers, bulk markets), target pricing, seasonal price fluctuation plans, and local demand.
Financial Model & Unit Economics: Provide a precise breakdown of initial inventory, transport costs, expected selling prices, gross margins per item, and a clear 3–6 month cash flow projection.
Risk & Security Plan: Detail your inventory storage strategy to prevent spoilage, strict cash-only sales policies to protect working capital, and the expected timeline for sponsor payback or profit distribution.
Lastly, to be perfectly good before submitting to an investor. I suggest you put all to writing then give a consultant/ an expert in business proposal writing to help revamp.
See less