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The event took place on Saturday 28 September at Workshop17 in the Watershed at the V&A Waterfront in Cape Town. The MC at the all-day workshop was Sechaba G and the event included inspiring talks from keynote guest speaker Jo-Ann Strauss, Old Mutual Unit Trusts managing director Elize Botha, Good Housekeeping deputy and lifestyle editor Vicki Sleet, and two financial experts from Old Mutual.
The event was the place to be for curious and ambitious women. Guests had a chance to interact with the panel, which also included COSMO editor Holly Meadows, enjoyed delicious food and a networking reception, received a goody bag and could enjoy complimentary makeup touch-ups by Elizabeth Arden. There was also a chance for them to win fabulous spot prizes, including R5 000 cash!
Here are 10 money-savvy lessons we learnt from the experts:
1. Don’t fall victim to the Cinderella Complex – be your own superhero!
Old Mutual Unit Trusts managing director Elize Botha brought up this vital topic to emphasise the importance of financial independence.
First described by author Colette Dowling, the Cinderella Complex details a woman’s fear of independence, and an unconscious desire to be taken care of by others. In a society where we’ve been conditioned to expect Prince Charming to carry us off into the sunset, this complex is understandable, but the truth is we can, and should, be our own Prince Charming!
According to Botha, 60% of South African moms say they are single mothers, and only 20% get regular income from their former partners.
‘We need to take charge, change our lives and plan for what we do not know. You’ll never know what can happen tomorrow, but you can change your reality today,’ says Botha.
2. Don’t spend money you don’t have on things you don’t need to impress people you don’t know
Keynote guest speaker Jo-Ann Strauss hit the nail on the head with this super obvious but sometimes hard-to-follow advice. Social media can be a great tool for drawing inspiration, but there’s a darker side when it comes to trying to impress others. Don’t put yourself in a bad place financially just so that your new Gucci bag can get you to 1 000 likes. It’s totally possible to #LiveYourBestLife and stick to your budget at the same time!
3. Prepare for emergencies
No-one likes to think about all the things that can go wrong in life, but you have to make sure you are prepared for emergencies financially. According to the experts you should have between three and six months of your salary put aside at any given time for a rainy day. This fund is not your backup plan for when you and your girls want to take a spontaneous trip to Bali – think more along the lines of accidents, unexpected medical costs or a sudden loss of income.
In addition to your emergency fund you should also investigate gap cover with your medical aid, along with disability insurance. It might be difficult to do, but you should also take time to draft a will to protect your assets or dependants if something should happen to you. Have your will drawn up with the help of a professional to avoid any ambiguous wording or tricky legal loopholes.
4. Start saving and investing today
According to Botha, only six percent of South Africans are currently able to retire comfortably. This is a scary statistic, and the earlier you start saving for your future the better. A common trap we fall into is ‘I don’t have enough money to save right now’, but the truth is that every little bit helps. Start looking for money and you’ll probably find some.
Ask your great-aunt for money on your birthday instead of a scented candle, sell the clothes you know you’ll never wear again and put aside any extra cash that comes in here and there for savings if you can. It will all add up.
As for investing, start today, as it will make a bigger difference than you think. According to Barry Matthew, a Certified Financial Planner® and a member of the management team of Old Mutual Unit Trusts, ‘the earlier you start, the bigger the benefits you get from compounding through reinvesting the dividends and interest you earn.’
According to Matthew, if you want R1-million for your retirement years and you start investing at 18 years of age, you only need to invest R155 per month to reach your goal, if you start at 25 you need to invest R308 per month, at age 35 it’s R847 per month, and at 45 it’s a whopping R2 623. You can see where this is going – start early.
5. Investing is much easier than you may think
Again, it’s a myth that you need a ton of money to start investing, or that opening an investment account is a daunting task. As an example provided by Botha, with the 22seven app you can start investing with just R250.
Try to live by the 50, 30, 20 principle, which essentially means you will spend 50% of your income on necessities like rent and food, 30% on your wants and debts, and 20% on saving and investing.
Don’t be scared of digital methods of investing. There’s an app for everything, and we trust technology with our fitness, health, transportation and love life, so why don’t we trust it when it comes to our money?
According to Pat Magadla, senior business development manager at Old Mutual Investment Group, investment and banking apps are your new best friend. Different things work for different people, so look around and see which app suits your financial life best. Some options include 22seven, Goodbudget, Mint and Wally.
If you head to www.oldmutualinvest.com you can open an investment account in just four easy steps, and you can choose from the Investment Series, 10 hand-picked funds, with varying degrees of risk and different investment periods. If you’re still a bit unsure of how it works you can partner with an accredited financial adviser, who is trained to help you.
‘In the time it takes to sit and drink one glass of wine you can open an investment account and secure your future. The only things you need are your smart device and good WiFi,’ says Magadla.
6. Prioritise your debt
Debt can be a scary topic, but like most things in life it’s better to face it head-on to regain some control.
There is good debt and bad debt. Good debt has the potential to see your net value increase, for example a home loan or a loan for buying a business, and bad debt is usually borrowing to fund your lifestyle or a depreciating asset (something that’s going to lose value quickly). Either way, you should have a strategy when it comes to paying it off. According to Matthew, this is the check list you should follow when it comes to your debt.
Don’t compartmentalise. If you’ve got debt, try to get rid of it. Think of freeing yourself from debt as an investment too. Make your credit payments on time so as not to impact your credit rating. Always pay at least the minimum. If possible, pay more! Pay most ‘expensive’ debts first, like credit cards and clothing and furniture accounts. Close accounts that you are not using. Credit providers check all credit agreements. Don’t ignore your creditors. Be proactive and discuss a repayment plan. If you can’t make payments, involve a debt counsellor. 7. Have an accountability partner
Sometimes we really just need someone to tell us we’re making a bad decision, or that we’re slacking with our financial planning. ‘Who’s going to hold you accountable to actually implement some of the goals you have?’ asks Matthew. Pick a partner, a friend, a family member or a financial professional to help you stick to goals like saving, debt repayments or setting up a will and so on.
8. Learn to compromise and get creative – it’s satisfying to save money!
Good Housekeeping deputy and lifestyle editor Vicki Sleet says there are plenty of ways to save money at home (hello, bargain Betty!). From cutting down on buying snacks to painting your house with sample tins and accepting offers from your friends to bring food when they visit you, embrace the small ways you can save.
It’s also important to get creative and learn how to compromise. Instead of spending a ton of money on a new couch (eek!), look into how much the fabric and reupholstering will cost if you just update one you already have. ‘The moral of the story is that if you’re prepared to compromise, the sacrifice you think you are making is not even there,’ says Sleet.
9. Separate your savings account from your transactional account
This will keep your savings safe from your shopping trips and daily expenses. According to Magadla, opening a separate savings account can also offer you a more attractive interest rate.
Setting up an automated stop order will also keep the cash coming into your savings even when you lose a bit of your discipline.
An Old Mutual Money Account also gives you an option to select a percentage of your expenditure that will be allocated to your savings. For example, you can set it up so that five percent of everything you spend goes to your Old Mutual Money account, and it will definitely all add up.
10. Embrace budgeting
Budgeting is a word that often fills us with shame and dread, but the truth is that it’s our ally in reaching all our money goals. ‘This word is a swear word to many people, but the reality is that budgeting is the cornerstone of your finances. It affords you the opportunity to understand how much money you have and how much money you’re spending,’ says Magadla.
Set up a budget and track your spending with apps like 22seven, and make sure that you revisit it often to make sure that your budget always suits your current situation.
A special thanks to Old Mutual Unit Trusts and Elizabeth Arden for making this incredible event possible!
Images: Valentina Nicol
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