Savings secrets from successful people

Last updated on 4th December, 2018 at 09:35 pm

Ever wondered how CEOs and entrepreneurs make their money work? We did the digging, so you don’t have to! Read on for advice and ideas you can use.

Leboneng Mathebula, CEO Gridbow Engineers and Technical Services

The lessons you learn in childhood are key

“I was taught how to save from an early age, even though it’s still not the easiest thing to do. I’d receive my school allowance money once a month and how I spent it was up to me. At first, my money was finished before the end of the month. Then I decided to invest the money: I bought a packet of sweets that I sold at school; that’s how I saved to buy my first phone. I carry that childhood lesson with me to this day in business: to invest in assets that can generate income.”

Get professional help

“I have a financial planner on board who’s always available when I need them, which is very important to me. When choosing a planner, the main things I look for are their  qualifications, references and if they understand my current financial position, where I desire to be and how to bridge that gap. I also educate myself by attending financial boot camps that teach me how to be financially savvy.”

Be clear on all your different saving goals

“I use my savings as a guard for the future, in case any hiccups arise. I also have various savings accounts for holidays, family and any general costs. I view investments as something the next generation can benefit from and something that can generate income and profit.

“My greatest investments are my children’s education and assets that will help my company grow, from vehicles to tools and other essential components of my business.”

Take calculated risks

“When it comes to debt, you must consider if there are good enough long-term benefits in order to justify taking on debt.”

Be honest with family

“I am always transparent with my family so that they know what it is I can do, and what it is I cannot do financially. Set clear expectations to safeguard yourself and them.”

Kurt Moore, CEO, South African Liquor Brand Owners’ Assocation

Not disciplined? Use debit orders

“If you struggle with saving, setting up a monthly debit order is a great way to kickstart your savings journey. It’s also important to set up a monthly budget and stick to it.”

Get advice from someone you trust

“Finding a good financial planner who made it their business to understand the complex environment of finances was  a critical part of securing my financial future. I meet with mine at least once a year to discuss my investment plans and whether or not I’m on target to meet my objectives.”

Save differently based on your objectives

“I view saving as more of a short-term process, like saving for a rainy day in an interest-bearing account. All of my other savings go towards my bond because it doesn’t help to earn 4.5% interest on something when your bank is charging 9.5% on your bond. Reducing the interest charged on your bond is a very effective way of saving long-term.

“When it comes to investing, I see it as more of a long-term process where I can take some risks, such as investing in a combination of shares, bonds and offshore investments. I also increase my investments when there are setbacks in the market (like the 2008 crash).

“When it comes to your rainy-day savings, having these funds accessible in case of emergency is more important than yielding high returns.”

Be cautious about debt

“Debt for things like buying a house is unavoidable for most people. Managing that debt and making sure your payments are made timeously is important. Get to understand how credit works: what is the most cost-effective credit available? By way of example, a credit card is handy, but pay the full amount when it’s due, otherwise you can pay exorbitant interest.”

Beverly Gumbi, founder and managing member, Isivuno Containers

Use your professional learnings in your personal life, too

“My business is a key part of my life and fuels my personal finances. I’ve taken the financial lessons learnt from transforming my start-up into a successful business and implemented them into my personal finances. For example, when it comes to my business finances, I save a percentage of net profit towards a reserve for the company. Implementing this same process with my personal finances means every month I put money aside for a rainy day.

“I’ve also learnt the importance of keeping a clean credit record by ensuring I manage my debt well – a business lesson that applies to personal finances, too.”

Don’t be embarrassed to ask for help

“I have a business financial adviser as well as a personal financial adviser. At the end of each month, these advisers help me read my bank statements and explain anything that I don’t understand so that when I’m alone at home, I can effectively track my finances and see where I’m going wrong, or whether I’m meeting my financial goals.”

Use different accounts (and your friends!) to keep you accountable

“I open savings accounts for expenses I know are coming up, such as for my daughter’s  education. I’ve also structured different savings accounts with various clubs to keep me disciplined. For instance, a group of my friends has created a travel club where we save money in an interest-bearing account for a specific trip abroad. Not only does this help me stay committed – and keep me accountable! – it also helps me keep track of everything.”

Plan for the worst

“One of my main investments is property as it helps to safeguard my business in case something goes wrong and we need to sell one of our assets.”

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