Saving cash on the big day – what to do before ‘I do’

Love is always in the air… for someone you know, if not yourself. No matter how strong the bond, weddings can quickly become the bane of many flourishing romances.

If you’re planning your big day – and planning often kicks in now because of the amount of people who wed in December – you know how strongly money features in wedding prep. Don’t worry – with a few savvy tweaks, you’ll be able to smile all the way down the aisle.

Here are five things that’ll help you have a great wedding and still save cash for what truly matters – starting your new life, together, strong.

1. Have ‘the talk’ with your parents

… and your parents-in-law-to-be. It’s important to establish who is paying for what before doing anything else. It may seem scary, especially with your future parents-in-law, but it’s vital to voice expectations now and to set clear boundaries. It’s important to say things like: ‘I know it used to be tradition for the bride’s family to pay for the wedding and the groom’s to pay for the honeymoon. Can we talk about that? Who feels comfortable doing what?’

Don’t let people come to their own conclusions, that creates room for conflict.

Equally important? Telling your mom and whomever else you need to; ‘just because you’re putting money in, doesn’t mean it’s your day.’

Once the conversation has been had, set a budget, with clear definitions on who pays for what.

2. Do a ‘top ten’ exercise

Now that you have your budget, here’s something important to do with your spouse-to-be: sit down together and write out every element of a wedding you can think of. Start with generics like ‘dress’ and ‘venue’ but drill down to specifics like the chairs at the reception, the menu and what pastor or master-of-ceremonies you want. Take that exhaustive list and separately write down ten items that are most important to you about the wedding, in descending order.

Come together and look at your lists, taking common ones from both lists and coming up with a final list of just five non-negotiable priorities. Splash out on only those top five and spend as little as possible on everything else.

3. Grill your guest list

Another thing that will save you the most money is the amount of people coming. Your ‘per head’ count in terms of alcohol, venue hire and food all adds up to the biggest expense in most weddings. Discuss with your significant other and determine who is most important to you and get the list down to as small a number of people coming as possible… And don’t choose based on: ‘Who will be offended if they don’t get invited?’ Rather, think: ‘Who will I look back on in ten years’ time and feel happy they were there?’ The less people you have, the more you will get to appreciate each guest on the day.

4. Remember to be flexible

You now have more than enough to battle the wedding budget bulge, but before you go off planning, remember one last thing: it pays to be flexible at times. Whatever your budget is, make sure there is at least an extra 15 percent of the total amount extra for unforeseen expenses. You don’t want any nasty surprises on one of the best days of your life.

And, thanks to some savvy money-saving, you may now have enough money left over to plan a few more ‘best days of your life’ in years that are still to come…

Mother knows best… what moms can teach you about money

It seems fitting that May hosts both Workers’ Day and Mother’s Day… because who works harder than Mom? A mother is always there when needed, always willing to see the best in you and is a constant source of comfort and wisdom.

And quite often, she knows a thing or two about money too.

Mom would say: ‘You can be anything you want to be…’

Mothers hear every aspiration, from astronaut to movie-star all the way to wanting to settle down or get an MBA. And she believes you can do all of it. Why not follow her advice, financially, and set some audaciously big goals for the next ten years?

Complacency kills passion, which kills productivity. So dream big and chase some wild horses!

Mom would say: ‘Hold your horses!’

Your mind may be running wild with new dreams now, thanks to Mom, but remember that these things take time. In the meantime, balance your head and heart to make rational yet passionate decisions; don’t let those wild horses run away, keep them in check! Mom will often advise you to follow your heart, but what moms do is rather a masterstroke of loving fully and at the same time not throwing away responsibility, patience or the mindset of others’ dreams being important too.

Mom would say: ‘There there… does it hurt?’

Sometimes when you risk in life, you fall down. The more worthy a goal is, usually, the more attempts it takes to succeed. When we fell and hurt ourselves as children, we knew we could run to Mom and she’d know what to do. Often, she knew that ‘time heals all wounds’ and would simply comfort you until the pain was gone. Now that you’re older, the pain of more complex things like a failed business or money troubles can seem like it’ll never heal. Take a moment, allow yourself to feel what you’re feeling and try to learn the lessons that came with the fall. And yes, it’s still okay to talk to your Mom about it.

Mom would say: ‘Always look on the bright side.’

It’s true – in life the only thing you truly have control over is your attitude. Just one thing, but that one thing makes all the difference in the world. This is often said by the same mom who would say things like ‘don’t cry over spilled milk’ and, too, is true. There is good and bad in every circumstance, but those who pay more attention to the good and learn from the bad while not over analysing it tend to enjoy life more.

As Mom would say, life is short…

Your starter guide to alternative investments

In the wake of very lacklustre JSE performance and plenty of uncertainty, many investors have started considering thinking… alternatively.

In a nutshell

Alternative investments are different to the standard stock market approach; investing in assets outside the usual asset classes or in companies outside of the JSE-listed crowd.

But can you invest alternatively? The first thing to note is that, like anything bespoke, alternative investing is far more expensive and less easily accessible than good ol’ equities. However, if you have significantly more cash than the average Joe and the financial know-how these alternatives can easily outperform the normal market.

Assuming you can, should you? Here, we break down some of the main and most popular alternative investment options:

Hedge funds

Hedge funds are by far the most common and easily accessible of the alternative investing options. Due to this, they enjoy better regulation and options than other alternative asset classes. They are smaller, boutique funds often operating with much higher fees than traditional equities investing. But hedge funds routinely beat equities in the returns stakes, although not as handily of late.

The phrase ‘hedging your bets’ explains what hedge funds do well – hedge funds have a unique ability to ‘hedge’ themselves so that the investors behind the hedge fund manager can do well whether a stock appreciates or depreciates.

Hedge funds are essentially an exclusive pool of investors aggressively investing in a variety of opportunities not often available to the mainstream market. This can suit investors who have money to spare (the minimum investment requirement for most funds is high – sometimes R1 million just to get in the door) and want a long-term investment vehicle that’s safer than the stock market that offers similar or higher returns.

Venture capital and private equity

Usually only available to private equity of venture capital funds themselves, this is long-term investment in promising businesses near the beginning of their lifespan, with a view to share in their success later down the road when the company is turning a profit.

Venture capital investing, specifically ‘seed round’ investing during which the company invested in is very young, is typically a long relationship with the funder in an advisory role to the business and an aid in growth.

Private equity, although often grouped with and sometimes mistaken for venture capital, is different. Private equity often buys out these companies wholly or in part and so is the primary decision-maker, rather than the advisor.

This is attractive because private equity traditionally outperforms equity. Options here are limited to those with a private equity fund registered with SAVCA.

Socio-economic investments

Even more rewarding than the idea of private equity can be socio-economic investing – which is putting in finance and sharing in the returns later, not in a company, but in the country. So-called ‘impact investing’, these investment alternatives address issues in society like infrastructure, education for lower classes, renewable energy innovation and the creation of low-cost houses, to name a few examples. Few funds offer such options as it’s still a relatively new concept for SA, but it’s a great vehicle for those who can access it and are looking to improve and contribute meaningfully to the world while making returns on their money at the same time.

It’s important to remember that alternative investing is generally more difficult, exclusive, expensive and time-consuming than the well-oiled default of listed stock market options or old-favourite vehicles like unit trusts. They’re also newer here in south Africa, with less variety and regulation for now because there is simply less demand. But if you’re something of a pioneer and you want something very long-term, it may be worth a try. Just be sure to talk to your financial advisor and consult your personal financial plan before making any sudden movements.

Mindfulness matters: how about a quarterly review?

Earlier in the year we spoke on the importance of mindfulness in our busy, digital world. Unfortunately, many of us have grand intentions at the beginning of the year, eating healthily and meditating and generally trying to get the year off to a good start, but after a few weeks that dedication peters out.

Businesses (and some individuals) like to run quarterly reviews on performance, such as how your investments performed in the first quarter. Why not do a quick lifestyle audit as well? How mindful are your various choices and can you regain the passion you had for these goals when the year began?

The benefit of quarterly mindfulness checks

The traditional New Year’s resolution actually puts a lot of pressure on oneself – the unreasonable expectation for someone to drum up enough passion, willpower and enthusiastic discipline in the beginning of a year that must last them 12 months. How many of us would consider operating companies that way? Or expect our financial advisor to know exactly how to help us all year through various changes after only one short chat in January? Far more reasonable is the idea of making the decision to effect small changes day by day, in the moment, and to schedule a loose quarterly check-in.

If you think quarterly mindfulness check-in’s are a good idea but don’t know where to start, or perhaps even what mindfulness really looks like, here are some questions to start you off:

Question 1: Do I spend my time and thoughts on what really matters to me?

Mindfulness posits that both the past and the future don’t exist and all you have is now. So, in the now, what kind of life are you living?

Many of us sweat the small stuff by fixating on things which aren’t our true priority, like stressing over our golf handicap or our waist size when what we truly care about is being a good parent, for example.

Stephen Covey in his classic The Seven Habits of Highly Effective People puts it this way: ‘imagine your funeral in detail. Your wife, children or family, work colleagues and a group you belonged to are all going to say a few words on what you achieved in your life as an individual, a family member, a worker and as a member of society. What would you want them to say? Are you living that?’

Many of us aren’t. For your lifestyle audit, jot down in a notebook what you think on and how much time you spend with your family vs work, on Facebook vs reading a book, outside versus inside etc. Are your thought and time investments reflecting what is truly valuable and meanginful to you? What could you do differently in this next quarter?

Question 2: Am I spending my money on what really matters?

Similarly, how are your funds being spent? Many of us spend significant funds on mindlessness which has a numbing effect, like too much junk food, retail therapy and empty entertainment. Mindfulness is about looking at what you really love and spending money on that – like on a family vacation or yoga lessons. It’s also about investing in things which will increase your mindfulness and mental ability, like books you can learn from or a stimulating new hobby. Spend less money and time on mindlessness and more on the opposite, and you’ll naturally find yourself feeling more energised, present and awake.

Question 3: Am I investing in myself as an asset?

Time and money are important resources, but they mean nothing without the capacity to use them wisely. How well are you feeding your body? How well are you feeding your mind? Are you getting the medical recommended amount of sleep and exercise for a healthy life? In short, are you adequately maintaining the asset that is you?

Almost all of us can improve in some way in this arena and are often set off course by the distractions that life presents. Set yourself some goals to carry out in the next quarter. These are most effective when small and simple, like unplugging from all screens and electronic devices 30 minutes before bed or like spending 5 minutes a day sitting outside enjoying nature when you have your tea.

Pick a couple and go for it.

Happy mindfulness!

… Okay, but what are your parents’ retirement plans?

We often think about our own retirement plans, but these are actually not the ones most likely to hit you first. More urgent is the concept of knowing your parents’ retirement plans.

This is especially important if your parents are nearing the 65 years-old benchmark, but actually it’s vital to know at any time. Why? Because most of us, and especially the older generation, do not talk about money openly. So while you are living your life, there could be plans – or the lack of plans – that are going to majorly hit your finances once your folks retire.

The best thing to do is sit down and ask them plainly, getting as specific as possible. It can be an uncomfortable conversation to have, but forewarned is forearmed. Here are a couple of the most important questions:

When are you planning on retiring? Are you planning anything specific for then?
If your parents are planning to retire in just a few years or are in an industry with forced retirement and they don’t have enough savings… guess who’s going to fund that retirement? Best you know now.

Am I in your plans? Or am I the plan?
This is essentially the most crucial question. You need to know as soon as possible if you will need to take care of your parents. Until you have this conversation, you may have no idea that you’d subconsciously assumed your parents would give you their nest egg savings someday while they assumed they’d invest it on travel once they retired. That’s why these talks are so important.

Are there any debts?
This includes a home loan, medical bills, any existing student loans for you or your siblings that your parents took on and smaller things like cellphone contracts and clothing store accounts. Find out exactly what they owe and if they have the means to pay it back. This can also help you determine whether or not their ideas of retirement and if they have the funds are realistic. Again, try to seem helpful rather than probing as this is often a tough conversation for many parents.

Is there insurance and an updated Will?
Insurance gets a bad rap, but can be a huge relief if you know that your parents have adequate cover in place for the unforeseen ills of getting older, like sudden medical expenses, disability cover and even life insurance should they pass away. Check that both parents have adequate cover for all eventualities and, if they don’t, get them on it as soon as possible. Any retirement savings that are in place will get used to finance a crisis if there is no cover in place.

Also, unpleasant as it is to think about, if your parents are getting older you need to ensure that they each have a Last Will and Testament with up-to-date contents. It’s the only way for them to legally ensure their last wishes are complied with.

Do you understand that I’m asking these things because I care about you?
You’re probably thinking ‘this is a terrible idea’ at this point. Again, this conversation is uncomfortable for everyone 90 percent of the time. It’s natural for people to no want to talk about a time they’d be unable to feed themselves, and similarly you don’t want to feel cold-hearted. Just try broaching the subject lovingly and take it slow. It doesn’t need to all happen at once. It just needs to happen.

Can finances be a family affair?

Throughout the year there are clusters of holidays and long weekends when family comes to the fore. These moments are often an opportunity to step out of the frenetic hamster wheel of life, we now have long weekends and, for some, religious holidays to spend with those nearest and dearest to us. Which got us thinking – how much does your inner circle feature in your finances?

We often think of finances as a solitary thing, something for you to sort out alone – sometimes paying bills, sometimes lying awake worrying at 3am. You may nod your head thinking, ‘well that’s the way it has to be.’ But think about this: that is exactly what your parents, friends and family and sometimes even your spouse and children are going through, too. Do you want your sister lying awake worrying about her budget, all alone? Would she want that for you?

What if it didn’t have to be that way? Finances needn’t be a taboo subject and can be something the family can discuss all together. Share these conversations with those closest to you; your partner, your kids, your siblings, your parents, your grandparents and your grandchildren. Learn from their insight and teach them from yours. Then watch and see if you don’t all feel much closer by the end of the conversation.

Here’s one great place to start: at your next close family gathering, or long weekend, ask everyone to share a goal or a dream that they have. Then discuss how you can work together as a family to help that happen.

Not only could this be very useful for you in terms of financially planning for the future (like knowing your parents-in-law want to retire next year or your son has his eye on an expensive university) but it can also help ease the tension everyone typically feels about money all the time. The more you communicate and relate, the more you can dispel myths and fears about your future, your finances and the life you plan to live. You can plan for them, together, without the angst or the isolation that comes with how most people do it.

Even better, you can perhaps prioritise making someone else’s dream come true.

You see, love looks like something, and if you are able to splash out on horse-riding lessons for your child, it will send a powerful message that her dreams are important to you. So go on, try being someone else’s dream come true.

On the road: the best road trips for the long weekend season

It’s that time of year coming up again when the public holidays flow thick and fast for South Africa. With a country as beautiful as ours, the ideal solution could be a road trip.

Here are some of the best to get you out of the city and on the road.

Got three days? Enjoy the Garden Route
It’s an oldie but a goodie for a reason, especially if you stay on the coast. Even if you’ve done the Garden Route many times, there’s always a new wine farm to check out and side roads to take. Add horseback riding into the mix for some extra adventure.

Got four days? Hit the Midlands Meander
Durban is a holiday favourite but just a little too far away, for some, for a long weekend trip. The Natal Midlands, however, are a whole two hours closer to Johannesburg and boast some of the most extravagantly verdant greenery in the country. There are countless antique stores, cafes and curio shops to stop in and the prices are far lower than in Cape Town or Joburg.

Got nine days? Try Namibia
If you’ve never done a road trip to Namibia, you can’t possibly imagine how strikingly lovely the scenery is, how meditative the open, uncongested road and how friendly the people are once you get there. If you can fit in the extra drive, check out the Skeleton Coast – it’s on international tourists’ bucket lists for a reason.

Got ten days? Head to Botswana
In between the lush Okavango Delta and some of the best game reserves on the continent, Botswana is the ultimate road trip for a South African nature lover. Lush green bush, mighty rivers, striking sandy plains… Botswana has got it all. You’re unlikely to find cities as clean, unpretentious and well-run as Gaborone either.

There you have it, some of the best road trips to get your spirit of adventure without the exorbitant price of air tickets.

Teach your children well

It’s an overwhelming feeling most of us recall vividly – that first job, the first month of rent to pay and the exhilarating yet terrifying knowledge that we have to keep ourselves alive for the rest of the month for the very first time.

For those with children in school, a new experience awaits: watching your own child navigate those same hurdles. And yet, it doesn’t have to be a gauntlet for them like it was for us. In a few simple steps, you can set your child up to leave the nest more confident and wise than your own former self.

The younger they start, the better
You may feel that you want your children to grow up unencumbered by the stress of money. In fact, many parents who grew up in relatively poor circumstances want to lavish finances on their children to the point where they don’t even think about money…

Until they leave the house, that is.

It’s important to understand that the later a person starts to think about managing their own money, the scarier it is. Teaching your children the importance of rands and cents as early as possible is not only better for you, but significantly less stressful for them. As soon as your children are old enough to understand the value of money and the arithmetic behind counting coins, teach them how to draft a budget. Make it as fun as possible and empower them young with their pocket money.

… but don’t make it all about spending
Many savvy parents teach their children about money from a young age – but almost always with a mind to spending.

‘You can save up your R50 now instead of spending it on sweets today so that you can afford that game you want in two months’ time.’

While this does teach kids the vital importance of budgeting to an extent, it also tacitly enforces a zero-savings mindset. From as young as possible, teach kids that they should never spend all of their money and always have something in savings. For example, tell them that, if they save R5 in their piggy bank each month, you will give them R50 at the end of six months. If they leave that R50 where it is, they can get R100 at the end of the year. This alone will set your children up to succeed where many South Africans fail – having the benefit of compound interest from early on. Also offer your advice to help them pick out their first savings account and retirement or living annuity when they leave home.

Rainy day smarts
Also, emphasise the wisdom of having emergency savings separate to general savings. The benefits of a short-term safety net are numerous and ensure that, should something happen to you or to the economy, your child will able to weather the storm. This tip is often the hardest for parents to take because an important part of this with older children is letting them bump their heads a few times.

If they haven’t got emergency savings or insurance and they’re in a bumper bashing, for example, don’t just rush in to save the day. Ask them about what steps they had taken to safeguard against misfortune and let them see that it’s up to them and no one else to ensure that they thrive financially without getting crippled by twists of fate.

And remember: the better you teach your children financially now, the better they’ll be able to look after themselves – and you – later.

What Comrades runners can teach you about how to lead at work

In our modern world of convenience, there is something about marathons. People choosing the hard road, putting their physical and mental endurance to the test, is increasingly rare. With the Comrades season coming up soon, a few surprising parallels emerge for leaders. Read on to see what you can learn about excelling at your business from experienced marathon runners.

There’s no such thing as a quick win
Perhaps you could put it down to our easy 21st-century existence, but we all want success yesterday, not ten years from now. But for those of us who aren’t Bruce Fordyce, slow and steady really does win the race, in leadership and in life.

Many leaders want to impress shareholders, loved-ones and clients by being a rapidly rising star and getting enormous successes right out the gate. Unfortunately, those who pursue this usually neglect family, run roughshod over colleagues or staff who don’t want to work fifteen-hour days and even sacrifice their own health and sanity to achieve a hollow prize.

Marathon runners know that any true victory is made in the long haul over months and years of training without any recognition. Good leaders know it too.

Fortune favours the well-prepared
It seems counter-intuitive, but many otherwise rational leaders start a new project or a new business without ever really planning for the possibility that it might fail. It seems like negative, counterproductive thinking, right?

But ultramarathon runners have been doing this for years with one simple tool: visualisation. An experienced runner will not only physically prepare for an arduous race, but mentally will imagine in detail the exact moment when it seems their legs are about to give way or they think of quitting.

They then prepare a strategy of exactly how they’re going to keep themselves going. It’s a great lesson for business leaders too. Don’t just imagine the day when the champagne and bouquets are passed around, imagine the 4am worries and the crippling doubts and get a strategy to deal with it before it happens.

Uncommon leadership advice: be here
Forward thinking can only rake you so far, and many marathon runners will tell you that it’s not always the best idea. Think about it – you’re on the starting line, the gun goes… and you envision the hours and hours of hell ahead of you. It’s enough to make anyone turn around and go home.

Instead, Comrades runners need to learn to plan for the worst but, once they’re in the race, just focus on putting one foot in front of the other. How do you climb a mountain? One step at a time. Same with marathons, same with leadership.

Another benefit of being present as a leader is being more engaged with your team. It’s tough for someone thinking of 11 months’ time to ask themselves how their staff are doing right now and what they need to put in their best performance. Be present, but also think about others’ present states. A happy team is a productive one, after all.

Have a great week and remember – life is about the journey and not the destination. Focus on running well, leading well, and you’ll be just fine.

Keeping the lights on: how to keep overheads down in an unfair environment

There’s no doubt about it, businesses are getting squeezed from every side like never before. With load shedding back, the rand weakening, land expropriation casting uncertainty on the property scene and the price of electricity increasing, it’s tough to try and keep costs down.

While you can certainly hope for Eskom to get their comeuppance, it’s best to try and work with what we do have. Here’s how to keep the lights on in an uncertain time:

Skimp on the small and unnecessary:
The first port of call is the least painful – try and cut down on what’s not absolutely vital. If your company does beer and pizza each Friday, level with your staff and tell them that you’re trying to spend money on them where it counts, like an awesome end of year party. Limit entertainment expense budgets for your sales staff and executives and see if there are any non-essential stationery items, like post-its or highlighters, you can buy every second or third month only. Funnel this freed-up cash straight into your overheads such as water and lights.

Keep your eyes on the road
Petrol is another expense that has been unforgiving lately, so another real way to reduce costs is with company vehicles and transport. Ask frequent travellers like sales reps to try combine trips and keep fuel spend low and, if new vehicles are required, try the pre-owned route and ensure you look at fuel-efficient makes. If you’re able, try to have out-of-office meetings over Zoom or Skype, saving you travel and time!

People pleaser
In any business, the most expensive and valuable asset is people. During tough times, it helps to cut back on recruiting new staff and rather focus on cross-training the people you already have instead. This is also likely to save you valuable time as these existing employees already understand the company culture and you already know they’ll gel with the rest of your workforce. However, don’t skimp on training these transplants – you’ll really want them as upskilled as possible. Invest time in them and be sure to explain how this will be valuable work experience for their futures in the company and beyond.

Take out insurance
Specifically, regarding load shedding and the chaos it causes, a great purchase can be business interruption insurance. For those who can afford it, business interruption insurance the overheads that your business continues to incur despite the drop in income that things like load shedding might bring. Remember, some policies will cover load shedding while others won’t, so be sure you check before settling on one.