Q & A Afika Soyamba

Afika Soyamba is the founding member of the Power FM ETF Club. He is one of the people I follow on Twitter whom I feel inspired by their focus on improving the state of their  finances. He has started his own blog, where I am hoping that he will write about the Stokvel that was for getting rid of debt. Please check his blog out first-hand:

https://ufudolobutyebi.wordpress.com/

Who is your ultimate wealth super hero role model that inspires you?

• My superheroes really have been my mother, my late Grandmother and they are not anywhere close to being wealthy, let alone being rich. These two women taught me a lot but they never sat me down to tell me how to handle money when I start having my own. I learnt from observing how they handled money. My grandmother was known to be a stingy person and she spends her money wisely. Only getting a government grant a once in a while one of her children would send her money. But she managed to make sure we had something to everyday and we were eating nice.lol. She only had a ‘Sales House’ account that she rarely used and no other debt, except maybe at church(Wisile)
• Then there is my mother – when I started staying with her, I then began to know her finances and realized that she always have like 2 to 3 times her salary in her bank account. Me on the other hand I was running out of money before the month ends. Worst part I was earning 2 times more that her and that didn’t sit well with me. I told myself that I want to be like that. I remember when she was suspended at work for three months without pay and she never had to borrow money or me having to help out, life continued as normal for her.

When did your journey towards wealth creation begin?

• My wealth building started when I decided that I wanted to pay off my student loan (NSFAS) debt in 24 months and that was in 2009 when I started working. Attacked that debt like crazy and open a savings account with FNB which I later transferred the monies to a newly opened savings account with Standard Bank. I wanted that money not to be readily accessible as I was using FNB as my main bank. I think 4 months later went to check the balance standard bank and I was told that I have never opened a savings account with them. I was transferring money every month. I never got my money back. So from then I think I always wanted to save again, but I only know about the banks. I think I was until there were talks of MTN Zakhele where I started knowing about the stock market in 2010. It never stopped and I am still struggling to build wealth. I now know so much and the journey continues until until.

Where do you envision your “net worth” in a year’s time?

• My short term goal is to see my net worth being at Zero. There is a high possibility that I might just get to that magic number or very close to it in about 18 months.

How can you easily break down this concept of “net worth” in layman’s terms?

• Net worth is a guide for your financial progress, and it’smore important than your income. Net worth is simply your assets like, savings and investments and minus your debts.

Why is direct ownership (JSE) by the Black community at only 3%? Are there any remedies that you can suggest?

• Black community was not allowed to take part in the real economy (markets) and over the years they probably just forgot about JSE and focused more on just getting freedom or it was the least of their worries. We got the freedom and all we were thinking about was racial integration not integration of the money. It puzzles me when people write about the gap between the poor and the rich is widening but when it comes to black and white they would say the gap is getting narrower because of the opportunities that blacks have now ‘over’ their white counterparts. Net worth is built over time and we all know what compound interest does when given time. Black communities where never allowed that opportunity it’s going to stay like that for some time.
• The current generation is the first to actually have money to invest but it’s hard to just look after yourself and not your parents and siblings. Most black professionals belong to the generation known as the sandwich generation because they need to take of their aging parents and their own families.
• Even though we have high income earners, they still do not know the financial tools to build wealth and those who know they are not too confident and they are afraid of them I remember when I was attending some ETF investment seminar at the JSE. I spoke to some guy and he was saying he wants to start to invest but he is afraid. He asked why all of a sudden are ‘they’ opening up the stock markets to the black community and what are they not telling us. I told him it was up to him to decide and I walk away from him.

Remedies

• Education, education, education. We need to educate the general public about investments, debts. Financial literacy needs to be something that is taught at the school, varsities, workplaces, stadium events, churches.
• A generic platform is needed where it can come to the people, instead of people going to it to learn. I believe those people that go to seminars they already know something and looking for more info. What about those who know nothing about these things? Companies do try to educate people but I feel they do it only to lock those people with their products. I would like to see more investment companies to take charge of investment education not the insurance companies.
• Create a second stock exchange for small business, where they can raise funding to expand their businesses and not always looking for from the government.

What advice can you give to others who aim to be debt free?

• Stop acquiring debt today
• Know and understand how and where your money is going(budget)
• Pay your debt from the smallest to the largest(consumer debt)
• Make some changes in your life, some call them sacrifices. Please don’t use words like that.
• Lose or sell unwanted and underutilised stuff.
• Build an emergency fund, people, yhoo this has been my downfall.
• Payoff your car and keep it
• Start to attack your home loan and student debt if you have any.

Then you can party all night, just one night though.

Q & A Mzwandile Sibusiso Nkosi

Mzwandile S. Nkosi @mzwa_nkosi is the author of the My World, My Money blog myworldmymoney.weebly.com and I came upon this blog on Twitter. I have been following his tweets and blog consistently. I love reading, and I love reading about money. So it was a delight for me to read his blog which chronicles topics that he is passionate about: investing as well as entrepreneurship.

Mzwa was kind enough to contribute his views on an article posted to this blog on Car Financing, here is the link https://imaliyam.wordpress.com/2015/05/22/car-finance-good-or-not-so-good/

Below, please read more about Mzwa, and his thoughts. Don’t forget to go visit his blog!

Who is your ultimate wealth super hero/role model that inspires you?

My ultimate wealth super hero is Mark Zuckerburg, the founder of Facebook. It sounds very cliché, but he really thought outside the box with Facebook. I have a lot of respect for tech entrepreneurs. It annoys me whenever someone is starting a catering company or construction company. I know there is a lot of money there. But I get excited by innovation and brands. Mark pulled that off well.

When did your journey towards wealth creation begin?

My journey began in 2008. I looked around and wondered why there are businesses at all. Why do they exist really? And why am I not in it? My logic was, if businesses exist and people are making money the “easier way” than employees, then owning a business trumps working. And that makes it a must.

It just stopped making sense to me to be employee. I asked myself, why do we put ourselves through that? And when I observed I saw that anyone can get into business. There were no rules and you did not need permission. You just need to register with CIPC (then Cipro) and they don’t ask you many questions. They just let you register. I was amazed at how easy it was. I registered my first tiny consulting business and others came after. Although I am starting over again, I went through a good period of being practical. I failed and learnt a lot.

What lessons have you learned on your wealth creation journey?

I have learnt that a business is the best income generating asset. Turn your business into a brand, and that brand will make you a lot of money. Then use that money to buy other income generating assets, like shares in other businesses.

Where to from here on your financial journey?

I am starting an investment company in the near future. The company will serve as holding company that houses some good business ideas that I have. I want to put them all under the same umbrella/brand so that I can build a strong foot print. The company will also hold equity in other businesses started by other entrepreneurs. It will invest in other people’s ideas too.

The other part of it would be holding equity in smaller brands that are listed. The aim is to buy all the issued capital from such entities if not a huge bulk of it. And to bring in my love for ETFs, the holding company will be responsible for investing in ETFs on behalf of the subsidiaries to ensure that have future capital.

How would you advise someone wishing to enter the world of entrepreneurship?

Know your weaknesses/limitations. I am bad at marketing. That is something that contributed to my failures in the past. Good product, bad communication management. And once you know your limitations, either go learn or pay someone who is strong in that area to help you.

Why is direct ownership by black community only at 3%? Are there any remedies that you can suggest?

In my opinion, the problem is access to information. In my experience, black people do not have sufficient information in terms of how they can get a piece of the JSE. The reason for this is the legacies that were left behind. Most of our parents didn’t have the information on how to own shares and that was passed on to us.

The remedy is that since we know how to invest in the JSE, we must pass that information around robustly to our peers. Additionally, we need to inform our children, nieces and nephews about the JSE. It should be a conversation that we have during dinner in the evenings with our kids. We must ease them into the concept from early age.

Mzwandile Nkosi- Tweet him @mzwa_nkosi and his blog is:http://myworldmymoney.weebly.com/

Q & A Power Fm ETF Club Part 2

Back By Popular Demand… A phrase often heard on television (especially on Etv,lol), but this time, this phrase does ring true. After the last Q and A done on the Power Fm ETF Club, I had more questions for them.

https://imaliyam.wordpress.com/2015/04/13/power-fm-etf-club-qa/

And so far, that Q and A is one of the most viewed article on the ImaliYam Blog, so yes, Power Fm ETF Club is back by popular demand. Here goes…

Who are the people that you mainly wish to target to be part of the Power ETF Club?

We are targeting the young people who are about to start working and those who are already working. Those who are about to work will know about debt traps and ways to build wealth and when they start working we can continue with them. Those who are already working will be exposed on how to reduce their debt and start investing. We also see ourselves working with the stokvels into converting them from just saving for short terms into investment clubs.

We would like Satrix/ etfsa or any financial services company product providing ETFs to partner with us to help us teach South Africa about investments.  We would also like to work with 22Seven to help us with the Debt-free campaign and CNBC Africa to help us with broadcasting when we conduct our seminars.

Where do you see the Club in 2 year’s time?

We are planning to have branches in JHB, Durban and Cape Town. We are working towards being a financial services advisory firm that educates South African youth about taking control of their finances.  ETFS, Debt Free / Wealth creating and share trading and financial markets commentary will be our main business. Also, we are working towards having a slot on radio where we will be discussing issues pertaining to finances.

How do people join the Club?

We believe that anyone who is passionate about providing solutions relating to creating wealth is already part of the club. There is no formal process of joining the club. If you are a young, professional South African wanting to grow your wealth then we believe that you are already part of the club. @afikasoyamba and @lirajazmine are merely the faces of the Club.  We are working towards having a database of some sort where we will keep a record of how many people are actually investing in order for us to quantify our nett worth.

What are some goals that you would like to achieve as a Club?

We want to show people that financial freedom can be achieved. We strive to live by the principle “Practice what you preach” as  we actually investing and cutting down on our debts. @Afikasoyamba has recently been debt-free while @lirajazmine has paid off her student loan. It is great to see and hear people bragging about their portfolios to their friends! Reduce the black tax that our young professionals are facing and be part of the generation that helped to eradicate the sandwich generation.              

 

Why the focus on ETFs as your main investment?

ETFs are a best way to start investing if you are beginner. That’s because of the many advantages they have, like being tradable on the market like an individual share, low cost and low volatility.  Although the name suggests that we are an ETF Club, we actually focus on the whole spectrum of finance e.g. ETFs, Debt-Free lifestyle, Share Trading, and Property .We are actually working towards changing the name of the Club to allow us to be associated with the full spectrum of finance and investments. We have realised that we have different talents; Afika is big on Debt Free living and ETFs while Lerato is big on share trading and financial markets commentary. We form a great that leverages off each other’s’ strengths!

You can follow the Power FM ETF Club on Twitter:  @PowerFmETFclub