Were you ever taught financial literacy? Did your parents talk to you about money? Do you feel that you are adequately equipped to become financially free?
Research says that by the time a child is seven, they’ve already formed financial habits (they learn from simply watching their parents). And so it’s important to both TEACH and DEMONSTRATE good financial practices from an early age.
My guest this week, Gugu Sidaki, talks family responsibility, financial literacy for children, and the concept of being financially free.
“Money is an enabler”, she says, “if you’re able to educate somebody about managing their money, you’re literally able to change their lives.”
- [00.52] Her path to wealth management, and the fulfilling aspects of investments.
- [03.50] Starting her own business and work/life flexibility.
- [05.32] How Gugu came to her passion, helping African people get better at money management.
- [06.35] The concept of ‘Black Tax’ or as she prefers to call it, ‘Family Responsibility’ and how to manage it. Top tip: Planning is everything!
- [11.50] The importance of boundaries.
- [13.14] How to help support a young generation to put boundaries in place. Top tip: The first step is financial literacy!
- [17.31] Forming healthy financial habits at an early age.
- [18.55] The My 3 Piggies trilogy introduces children from the age of 4 to concepts of personal financial management. Concepts like ‘What is money?’ ‘Where does money come from?’ ‘How do I make money?’ ‘What is saving?’ And other concepts like sharing, and encouraging children to think longterm about investing.
- [20.12] Changing South Africa from a child’s perspective.
- [21.45.] Assumptions about money.
- [23.58} The concept of financial freedom.
- [24.53] As your income expands, so does your lifestyle. Ways to get around that. Top tip: As your income expands, keep your lifestyle the same!
- [28.02] Children and pocket money.
- [30.31] Gugu talks about her vision for Nala and the 3 Piggie Banks. She believes that EVERYBODY should have access to this information!
- [31.14] Sharing the knowledge that you learn.
- [32.44] An actionable step you can take now…
Learn more about Gugu Sidaki
For full service wealth management, head over to Wealth Creed. For more information on her books teaching financial literacy to children, you can visit My 3 Piggies. Alternatively, contact Gugu directly at email@example.com
Related posts and episodes
- Teaching children under 12 about money.
- Teaching older kids and adults about money.
- 114 Unleashing grassroots leadership of women with Dr Joanna Martin.
- 39 Aging parents: dealing with the financial and emotional challenges.
Quotes from this episode
“The only time that your parents ever talk to you about money is when they tell you they don’t have any.” – Gugu Sidaki
“I think if that conversation was expanded, I honestly believe that children would demand less if they knew how money was made; how difficult it was to actually make that money; and how it should be looked after.” – Gugu Sidaki
“I want to make the conversations around money a lot more comfortable, and a lot more common because I think that’s the only way that we’re going to be able to change the trajectory of a lot of peoples finances.” – Gugu Sidaki
“Planning is everything. You know that that call is going to come. Where it’s going to come from you don’t know. But it’s definitely coming. So how are you best able to manage that for the future?” – Gugu Sidaki
“As much as you have a responsibility towards your family, they too have a responsibility to manage whatever little money that you’re giving them.” – Gugu Sidaki
“It is a really really difficult psychological burden, because how do you justify the life that you’re living when there are family members who can’t even afford to eat.” – Lisa Linfield
“If you have no need to get work then why would you? Because someone else is paying for it.” – Lisa Linfield
“Unless we all start, it’s never going to happen.” – Lisa Linfield
“There’s always this assumption that if someone else can afford it, then it’s affordable.” – Lisa Linfield
“The lower your expenses are, the quicker you can have financial freedom.” – Lisa Linfield
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Speaker 1: 00:00 Welcome to Working Women’s Wealth, where we discuss what it takes to build real wealth in a way normal humans can understand. Here’s your host, Lisa Linfield.
Lisa Linfield: 00:09 Hello everybody, and welcome to today’s episode on Working Women’s Wealth. I am joined by the most special human being, Gugu Sidaki. She is a financial advisor who founded a wealth management business called Wealth Creed, which is a full service financial advisory business and wealth management business, and she is changing the world one human at a time. Gugu, welcome.
Gugu Sidaki: 00:49 Hi, Lisa. How are you?
Lisa Linfield: 00:50 I’m good. Thanks for coming on today.
Gugu Sidaki: 00:52 Thank you for having me.
Lisa Linfield: 00:53 So tell us a little bit about your background.
Gugu Sidaki: 00:56 I’ve known for the longest time I think, since high school, that I wanted to be a stockbroker, believe it or not. And then I think it was about a year after high school, there was a movie that came out called Boiler Room. I don’t know if you’ve ever watched that. I forget what the lead actor’s name is, and it’s a stockbroking movie. It’s almost like the Wolf of Wall Street, but properly fascinating. And for me, that solidified what I wanted to do with my career. But I studied economics and then I majored in investment management after that. I eventually got the opportunity to get into stockbroking at a boutique stockbroking business here in Johannesburg and I loved it. I did it for about two years and I honestly was in my element.
Gugu Sidaki: 01:38 It was a lot of work and yeah, two years in, my then boss [inaudible 00:01:43] Feldman actually approached me and I think she could see that I couldn’t do the stockbroking thing for much longer because the energy was very different. She was running the wealth management business in the Johannesburg office and she suggested that I join her wealth management team. It’s something that I had never considered before. I’d never really known much about wealth management until that point, and she was about the only female wealth manager that I’d known. I took a chance, I decided to follow her advice and I have not looked back. She literally changed my life and I have not been able to think of myself doing anything other than what I’ve been doing for the better part of the last 12 years.
Lisa Linfield: 02:18 And what was wealth in your family that you got into the stockbroking thing?
Gugu Sidaki: 02:25 You know, it actually had nothing to do with my background at all. My dad was an entrepreneur. He was actually a teacher by profession, but it wasn’t something that he wanted to do with his life, so he quit and did a few other things and eventually founded a number of businesses. He was one of those people that had a finger in every pie. So money was always around us. It was always in our lives, but it was never a formal discussion. We never had a point in our lives where it was discussed, “This is how I make money. This is how you need to look after your money.” I just used to watch from a distance, him doing all his things and working and making money. I can’t really say that there was much of an influence from growing up.
Lisa Linfield: 03:02 So you made the move from stockbroking into wealth management. What about wealth management appeals to you?
Gugu Sidaki: 03:08 I just found that the conversations became a lot deeper because traders are a different kind of animal. I mean I was on the trading desk at that stockbroking business, I was on the execution desk, and people literally call in, they speculate on the market. It’s a different mindset. And you engage them to a point, regarding stocks going up, stocks going down, buying and selling. Whereas with wealth management, you now are literally getting into their lives, finding out what’s making them tick, how they made this money that you’re now investing on their behalf. And it’s such a fulfilling aspect of investments. And I think I’m a connector. I love talking to people, I love engaging people, so it’s something that definitely resonated with me beyond just the investments.
Lisa Linfield: 03:49 And so you decided to set up your own business. How has that been? Why did you do that and how’s that journey gone for you?
Gugu Sidaki: 03:57 I think after having children… so I’ve got a four-year-old and a two-year-old … my view on life started changing a lot. I knew that I wanted to stay in the industry. I just didn’t know how. I mean I’d spent about 10 years working for the same institution and I knew at some point that I was going to have to leave. How I was going to do that wasn’t properly solidified until after I’d resigned. I’d been having a lot of conversations with many people and it was only literally after I left the institution that I was working for that I had a very clear picture of what I wanted to do. I knew I wanted to remain a wealth manager. I just wanted to do things slightly differently and on my terms and being a new mom, it was important to me to … I know it’s very difficult and actually doesn’t exist, but to strike a healthy work-life balance and I think running my own business I thought would allow me to do that.
Lisa Linfield: 04:48 I don’t think of it as work-life balance. I think it more is work-life flexibility.
Gugu Sidaki: 04:52 Well, yeah, I think that’s better put, for sure.
Lisa Linfield: 04:54 It gives you the flexibility to be able to be there for your kids. But I work harder in my business than I ever did in corporate, and I thought I worked really hard in corporate. But I am at every netball match and I am at every hockey match, and I do take them to the doctor. And so I think of it more as work-life flexibility and more flexibility to achieve both, as opposed to one or the other. We’re trying to kind of get that scale into balance.
Gugu Sidaki: 05:20 No, that’s very true. I’ve found that my hours are very different compared to what they were at the bank. I’m working a lot on the evenings, on weekends, which is stuff that I never used to do when I had a formal job.
Lisa Linfield: 05:31 Absolutely. Absolutely. So your particular passion and focus is to help African people to get better at money management. How did that kind of come about?
Gugu Sidaki: 05:43 As I said, growing up, we never really discussed money and the more you talk to people, it’s a common thread across the board. It’s funny, I was having a conversation with another friend of mine and we both had similar experience in that the only time that your parents really talked to about money is when they tell you that they don’t have any. When you ask for things and they say, “I don’t have enough money for that.” And I think it’s just such a stunted view of money because I think if that conversation was expanded, I honestly believe that children would demand less if they knew how money was made, how difficult it was to actually make that money, and how it should be looked after.
Gugu Sidaki: 06:15 But if you continuously tell a child that there’s not enough, “I don’t have any,” I don’t know, it just creates a different mindset in a child. And I’m determined to change that for our people. I want to make the discussions around money a lot more comfortable and a lot more common because I think that’s the only way that we’re going to be able to change the trajectory of a lot of people’s finances.
Lisa Linfield: 06:34 Yeah. And in South Africa, there’s a colloquialism called Black Tax. What is that and how do you experience that?
Gugu Sidaki: 06:42 Sure. During apartheid times, black people were restricted from doing a lot of things. From education, to living where they wanted to live, to working the kind of jobs that they wanted. There were many restrictions, and that’s had very negative consequences on the current generation. You find that in any given family, there’s probably like a handful of people who are successful and who are making money, who are the breadwinners. And those people are having to now spread the little that they make and they have to share it with a lot of the family members who don’t have a lot. It’s called Black Tax because it’s the additional costs of being black.
Lisa Linfield: 07:18 Absolutely. And how do you think of it?
Gugu Sidaki: 07:21 In our business, I think black tax has such a negative connotation. We prefer to call it family responsibility because at the end of the day, you’re helping people out. I don’t think that’s ever a bad thing. And I think if we change our view on it and if we empower clients to view it differently and to manage it differently, it can actually be a positive thing.
Lisa Linfield: 07:39 Absolutely. So how do you advise people to manage family responsibilities? Because it seems to be prevalent in all walks of life, especially now. I always say that the reason I got into this and I’m so passionate about financial advice is because I see this enormous tsunami of a challenge coming to retirement. Because the baby boomers are the first bunch of people who had defined contribution pension funds, meaning what they put in is what they get out. Whereas in the old days, people used to get paid until they died from the company they stopped working at. So this whole bunch of baby boomers is coming up with not enough money to retire. So regardless of your background, it’s obviously accentuated historically in South Africa and your background. But for our American listeners, for our English listeners, for people around the world, the biggest challenge that is facing all of us is family responsibility. How do you help your clients to think about the additional financial burden of family responsibility?
Gugu Sidaki: 08:43 I think planning is everything. A lot of the clients that we interact with, most of the time we are the first experience that they’ve had with a financial advisor. So that whole experience, and managing that experience, is actually quite a task. The next level of it is, “Okay, beyond the money that you make as a client for yourself, how then are you able to best manage money that you give away?” I mean, I remember with my dad, he was the breadwinner in his family. He used to assist a lot of his family members. And a lot of it, even as a child, I remember this was quite haphazard. People would come in and out and make requests and then he’d have to fulfill on those requests. But it was never anything that was planned for in advance.
Gugu Sidaki: 09:22 And I remember my parents used to get into a bit of fights over that because I mean, they’d planned to do a few things as a micro family and then my dad would give away some of that money. And it used to cause a lot of issues for them. And I think with the clients that we are assisting now in terms of family responsibilities, that planning is everything. You know that that call is going to come. Where it’s going to come from, you don’t know, but it’s definitely coming. So how are you best able to manage that for the future? So we teach them that there are investments for you, but then also create a family fund, if you will, for those eventualities.
Lisa Linfield: 09:54 Absolutely. I mean, one of the things that I often say to my clients is around the sense of, okay, how much do we put aside every month for this particular thing? Also to find there’s often a matriarch or there’s often a person who’s putting pressure on the younger generation to pay for all the old aunties and uncles and all that kind of stuff. And what I do is that often I’ll say to them, “Who’s the person that puts the pressure on you?” And they say, “Mama.” So I say, “Okay. So if you’ve got R1,000 a month or R2,000 a month or whatever it is that you’re going to give, give it to mama and get mama to distribute it. It’s amazing how those phone calls start. And often I say, “If mama wants more, then mama must say no.” And it’s amazing how things that she could ever say no to before, she now can say no.
Lisa Linfield: 10:39 Because for those young 22, 23 year olds, it’s a huge burden that they pay to look after the family. And I think that especially, when you’re dealing with extreme poverty, it is a really, really difficult psychological burden, because how do you justify the life you’re living where there are family members who can’t even afford to eat? But it’s amazing when there is a sense that this isn’t a bottomless pit, how priorities are actually able to be greed amongst the family members. And if mama runs out, then the person must come next month. Get first in line for it next month.
Gugu Sidaki: 11:12 For sure. It’s a very, very difficult thing to manage. And like you said, they struggle because they young and they are having to say no to all the family members. It’s also a cultural thing that we are having to manage. And quite interesting, I had a phone call from another client, he found me randomly. He says he was looking for a financial advisor and he came across my name and he was quite serious in finding a black financial advisor. And the first thing he says to me is, “I looked for you because I know that you’d understand my issues.” And the first thing that he mentioned is exactly that, is that he’s got a massive family responsibility and he needs somebody to help him manage it. So I think we’re finally at a point where we realize that this is here, it’s happening. We need to solve for it and we need to get help.
Lisa Linfield: 11:50 And it’s hugely important. The other day I was coaching a young 25 year old. She was responsible for her parents, her elder brother and sisters and all of their children. She was the one with a very tiny salary who had to get a home loan so that they could move out of one room for the entire family to live in a home. But then obviously the home needs beds and things like that. And over the three years she had owned her home, she had paid an interest on the freezer, the beds and all of that. The same amount as she had borrowed. So in three years, all she had done was hadn’t paid any of the debt back, had actually increased her debt because of revolving credit payments, and she herself was starting to get sicker and sicker at such a young age, because she had to wake up at three in the morning to take the bus to go to work, to give all of this money to the family.
Lisa Linfield: 12:41 And it was around teaching her about boundaries, which is that, in order to get you to be able to produce more, you need to be in good health, and in order to be in good health you need to afford the car to get you to work. In order to afford the car to get you to work, you need to pay down this debt and also your sisters need to go and earn the money to look after themselves. You can’t feed and clothe and whatever 12 people and pay for all of the house and the debt when in actual fact, there isn’t even enough for one, let alone 12. And how do we help support this young generation in putting boundaries in place when there are so many cultural and so many major challenges.
Gugu Sidaki: 13:26 It really is a tough one. I mean, it’s work in progress for us, but I think the first and very most important step is the financial literacy aspect. I mean, I also teach a lot of these clients that we meet is through these financial literacy sessions that we have, and these are empowering because a lot of the time clients are able to then find money that they never knew existed, through the budgeting process through actually understanding what and where their money is going to.
Gugu Sidaki: 13:53 It’s a new thing that we’re trying to introduce to clients, but we’re suggesting that we’d like to facilitate meetings, family meetings, to make the conversations a lot easier for these youngsters, because like you said, there’s usually a matriarch or patriarch who dominates and it becomes very difficult for the young individuals who are making money to have the boundaries. So we’re introducing it, we haven’t had any take-up yet, but to say, can we sit in on your family meetings and can we bring your budget into this discussion? Can we tell your people what it is that you’re actually making and where this money’s going? And the fact that it is not a limitless pool of funds, that there are limits and we need to look after that money very carefully. As much as you have a responsibility towards your family, they too have a responsibility to manage whatever little money that you’re giving them.
Lisa Linfield: 14:35 Absolutely. I always think about that fable of the goose that lays the golden eggs and how greed and need and all of that gets that the people want to kill the goose to get inside the goose to get all the golden eggs. The problem is once the goose is dead-
Gugu Sidaki: 14:51 No more eggs.
Lisa Linfield: 14:51 No more eggs, and it is absolutely valid. When I was coaching this young woman, the picture that came to mind is of this poor little goose that heads off at three o’clock in the morning to go to work whilst everyone else sits at home and eats everything, and she has the financial burden of trying to service this debt and trying to pay this debt. And I think it’s a challenge is that, if you have no need to get work, then why would you? Because someone else is paying for it.
Lisa Linfield: 15:22 And I do believe in family facilitator conversations. I’ve actually done quite a number of them and it is a hugely delicate process because there are so many years of unsaid words that come out through this whole process, that I think it is wise for clients to engage an external person, because I think there are things that you cannot talk about.I always say, I think all teenagers need a therapist because half the problem is their mother. Or at least in their mind, there is. So they need an external third party in this whole process. And I think sometimes, that I often say to people, it’s not that I’m going to say anything different to what you would say, but it comes from a different person that has no history and so therefore it’s not taken out of the words-
Gugu Sidaki: 16:11 It’s not personalized. Yeah.
Lisa Linfield: 16:12 Absolutely.
Gugu Sidaki: 16:12 Yeah. See the difficulty with us is we don’t come from a culture of having financial advisors. That’s the first thing. The second thing is we don’t come from a culture of talking about money. And I am a female client who could potentially have to address a patriarch in the family. I mean, that’s another big cultural dynamic that would have to be managed very carefully. So it’s a tough one. And I understand why we haven’t had any take-up with that because there’s a lot of layers to this and before we even get to the problem, we first need to sift through all these delicate layers.
Lisa Linfield: 16:40 But I think part of that whole process is that, unless we all start, it’s never going to happen. So whilst it might be a novel concept now that you’re dealing with, after 10 years of us talking about it, it hopefully we’ll get the uptake. Because I think the reality is, yes, there are all of these stumbling blocks of current mindset, but I think the problem is growing in such severity, the pressure on young people to support massive communities is so major, that I think that the more we talk about it, the more we get that message out there, that there are alternatives.
Lisa Linfield: 17:20 You don’t have to sit here under this weight all by yourself. Then it opens your mind to say, well actually maybe Gugu is the person that we engage with in facilitating them. So in your financial focus and your financial education focus, you have also decided that in order to help this problem, you need to start tackling the younger generation. Tell us how we’re doing.
Gugu Sidaki: 17:49 This is born of a number of conversations that I’ve had with clients that I teach. I mean, one that stands out the most is a male client. I’ve known him for a while. I was showing him the manual that I’ve created, the financial literacy manual, and I was talking to him about the classes that I hold and eventually he came to one of the classes. After the class, he sat me down and he said to me, “I wish I had had this information 20 years ago.” And I believed him. It was in his face. It was in his gestures. He needed it. He needed to have these discussions. He needed to find out how to manage his money. And all the information that I gave him was very basic, according to how we view it as financial advisors, it seems like the basic information, but people actually need this information. It’s important information.
Gugu Sidaki: 18:29 And a lot of people would go through their entire lives not knowing any of it. And for me that’s where the idea came is that our schools are not teaching this information. Nobody has access to this information on a formal basis. So I’ll do something about it. I’ll write some financial literacy books for children and to get them to start thinking about money and to get them to form healthy financial habits for themselves from an early age, so that we curb this problem of having to now fix issues in their adulthood. And by that time it’s actually quite difficult to change.
Lisa Linfield: 18:55 So tell me about your first set of books that you’ve written.
Gugu Sidaki: 18:59 So it’s a trilogy. Sounds very exciting. And it introduces children from the age of four to concepts about personal financial management. So, what is money? It’s simple enough for, I think, I pegged it from the age to four. Where does money come from? How do I make money? What is saving? What is budgeting? What is spending, overspending, underspending, and teaches them the concept of sharing. Because we live in a world that requires us to think more broadly and beyond ourselves.
Gugu Sidaki: 19:30 So in the second book, I encourage children to start sharing whatever money that they make, however they make it. And then the final book is encouraging them to start thinking longterm about investing and the benefits of investing. And interestingly, I have a friend who bought the book for her toddler, but her 12 year old has been reading it and he’s found more value in these books as a 12 year old than her toddler has. And they’re actually starting to implement some of the teachings in there, which is great.
Lisa Linfield: 19:57 So I’m looking at the books. They are Nala and the Share Piggy Bank. Nala and the Safe Piggy Bank, Nala and the Invest Piggy Bank. And there are fantastic books that Gugu has written on kids. Gugu, what would your vision for changing South Africa from the kids’ perspective be?
Gugu Sidaki: 20:17 Every time I think about that, I think of how I was introduced to this industry in the first place. I mentioned earlier that I was introduced to the business by my former boss. She changed my life. She literally did and I think I’ll ever remember her for that. I’d like to be remembered for somebody who’s changed the lives of, whether it’s children or adults, because money is an enabler. And it’ll fix literally every aspect of our lives. And if you’re able to educate somebody around managing their money, you’re literally able to change their lives. And that’s the legacy that I would like to leave. I’d like to change people’s lives and to leave them with a better way to manage their money.
Lisa Linfield: 20:56 I agree with you. I think if we can start with kids, we can at least make sure that the base of information is higher than what it is for most of us. I always think that I got an unbelievable education, both at school and at university. And I never ever, ever once learned how to manage money. And I kind of think to myself, how is that? How is it that we pay this exorbitant amount of money for education for our children? And when you look at it, I know Pythagoras Theorem is probably really important in some greater, wider context of the world, but I really also think that managing money is even more important.
Gugu Sidaki: 21:44 It is. Absolutely.
Lisa Linfield: 21:45 And also one of the things about money that I see when I teach kids is the assumptions that are made. And I think schools need to challenge that. I remember teaching teenagers, so grade 10, 11 and 12. And we’re talking about assumptions of money. And I basically said when someone comes to school in a Honda Jazz and right next door to them, someone’s mom comes in a Porsche Cayenne, what do you think? So we started to have these discussions of what do you think about the Honda Jazz mom versus the Porsche mom. And there is this natural assumption that the Porsche mom has more money.
Gugu Sidaki: 22:21 Absolutely.
Lisa Linfield: 22:22 And then I say, well “I’m the Honda Jazz mom. That’s what I drive. And I have definitely got enough money.” And I can tell you that nine out of 10 times, the Porsche Cayenne mom.
Gugu Sidaki: 22:32 Yeah. It’s not the case.
Lisa Linfield: 22:33 It’s financed.
Gugu Sidaki: 22:33 For sure.
Lisa Linfield: 22:34 So they’re paying every single year the amount of money that could take your whole family on holiday.
Gugu Sidaki: 22:38 Sure.
Lisa Linfield: 22:39 They are paying just to finance that car. Now what do you think?
Gugu Sidaki: 22:42 For sure.
Lisa Linfield: 22:43 And then there’s like this look of horror. Well, why would you not want to go on holiday? Why would you drive that? Why would you? And I said, “You guys are making these assumptions that are absolutely not well-founded.” So if schools could facilitate the conversations on how is money made? Why is it so important to invest? How do you live these lives? Whenever I teach are always started with assumptions. And I remember in teaching my Home Helpers, course where the one home helper said, “But if she has that cell phone then I should also be able to afford it.”
Gugu Sidaki: 23:17 Right. Keeping up.
Lisa Linfield: 23:18 It’s like, but you have no idea what her circumstances are. She might have a very rich husband and you’ve got three kids to support.
Gugu Sidaki: 23:24 Yeah, for sure.
Lisa Linfield: 23:24 And there is always this assumption that if someone else can afford it then obviously it’s affordable. Yet we never understand what their personal circumstances are.
Gugu Sidaki: 23:36 Very true. I always tell the story of a client that I had at the bank who literally made millions per month but come month end, they were cash strapped and needed to borrow money from the bank. And every time I tell the story, whenever I teach, people’s eyes are wide, wide open. And they’re shocked. And for me the biggest lesson that I’ve noticed that lands a lot better with the people that I’ve taught is the concept of financial freedom.
Gugu Sidaki: 24:00 What is financial freedom? Because a lot of the time there’s a misconception that it’s having millions and millions of rands, dollars, or whatever the case is in your bank account. And that’s not what it is. All it is is the fact that you have some money left at the end of the month. So you have income that exceeds your expense on a regular basis. And that is all that we’re trying to attain as financially responsible individuals.
Gugu Sidaki: 24:21 And it’s always a “Oh”. Because then all of a sudden you are free to build wealth, to create wealth and do all sorts of other things that you weren’t able to do before. You don’t necessarily have to finance the expense of cars, you don’t necessarily have to live on credit, you just have to live within your means. And that is the biggest lesson that I’m trying to impart on a lot of people that we’re teaching. And it’s a big lesson that I’m trying to impart in the books that I’ve written as well. To teach people that you need to live within your means, for you to be able to live the life that you want. It’s as simple as that.
Lisa Linfield: 24:50 Absolutely. And part of that whole thing is that the lower your expenses are, the quicker you can have financial freedom. So you can absolutely retire at 45 if you keep your expenses small. I always say to people, look back at yourself as a student. Were you able to make ends meet in that tiny amount? I mean I know personally I had the most disposable cash ever when I was a student, and the reason why was because the more money I made, the more money I had to spend. Whereas now I have to pay taxes, I have to pay for children and houses and rents and all these other funny things. And I say that’s one of the biggest challenges is that as we expand our income.
Gugu Sidaki: 25:30 So does your lifestyle.
Lisa Linfield: 25:33 So we expand our lifestyle. So all you need to do is as your income expands, keep your lifestyle exactly the same and start saving there. There’s a wonderful behavioral economics video that’s actually a TED Talk that talks about this concept of save for tomorrow, tomorrow. And I love it because it works on the fact that none of us can give more money to our financial advisor now. So if I say to you, “Hey, I just want 20% of your money.” You’d say, “There’s not a hope.”
Gugu Sidaki: 25:56 No. Never.
Lisa Linfield: 25:57 “I can’t find 20%.” But if you’re getting a six percent salary increase every single year, then what happens is that you give your financial advisor half and you keep half. So you get to slowly upsize your life, slowly.
Gugu Sidaki: 26:10 Gradually. Yeah.
Lisa Linfield: 26:11 And that three percent this year becomes six and a bit next year, which becomes nine and a bit the year after.
Gugu Sidaki: 26:17 It’s managed. Yeah.
Lisa Linfield: 26:18 Absolutely. And within five and a half years you’ve got 20%.
Gugu Sidaki: 26:21 Yeah.
Lisa Linfield: 26:21 It is absolutely possible if we stop upsizing our life. And we always think that we need the bigger car and all of that. And I always say to people, “It’s not that I want to drive a Honda Jazz.” When my car’s going [inaudible 00:26:33] on the highway, as I’m trying to go any distance further than around my neighborhood. It’s not that that’s a pleasurable experience.
Gugu Sidaki: 26:40 Sure.
Lisa Linfield: 26:41 It’s just that there is a time and a place for every single thing.
Gugu Sidaki: 26:45 Absolutely.
Lisa Linfield: 26:45 And you have to make choices.
Gugu Sidaki: 26:48 Agreed.
Lisa Linfield: 26:48 And part of it, and why I love the fact that you have written these books is that it doesn’t matter how much education. So it’s a good start. The education we can give kids. But families and parents have got to enforce that education.
Gugu Sidaki: 27:03 Absolutely.
Lisa Linfield: 27:04 In how they teach kids about money. I always say our job as adults is to raise children to be independent adults. And one of the biggest part of an independent adult is the ability to prioritize your resources, your time, your money. Whatever it is that is available to you.
Lisa Linfield: 27:23 And if our children, the first time they ever have to make a choice about money is when they enter the workforce. They’re never going to be able to do it.
Gugu Sidaki: 27:32 [crosstalk 00:27:32].
Lisa Linfield: 27:32 You have to make sure that each year gradually until they get to the end of school, they are increasing in the decisions they make about their money.
Gugu Sidaki: 27:42 Yeah.
Lisa Linfield: 27:42 A child will always say they need a new phone and new jeans.
Gugu Sidaki: 27:47 Always.
Lisa Linfield: 27:47 And a new this. It’s always the end for kids. Whereas if they have a finite amount of money.
Gugu Sidaki: 27:51 Yeah, they’ve got to manage it.
Lisa Linfield: 27:52 It’s so much easier for them to say no. If you say no, you’re being mean and nasty. If they have the money and they have to manage and they choose to say “No”-
Gugu Sidaki: 27:59 It’s a different [crosstalk 00:28:00].
Lisa Linfield: 27:59 All of a sudden, they don’t need it so much.
Gugu Sidaki: 27:59 Absolutely.
Lisa Linfield: 28:02 The whole thing with children and pocket money is the prioritization that they learn.
Gugu Sidaki: 28:06 Yes. And the delayed gratification.
Lisa Linfield: 28:08 And the delayed gratification and that understanding of this kind of finite pot of money.
Gugu Sidaki: 28:13 Yeah, relationships, yeah.
Lisa Linfield: 28:14 Then you send these kids to university, they have to learn to get a job. They have to learn that sometimes you are going to have to work instead of go to that party that everybody else is going to. They have to start prioritizing even more of their amounts of money. So that, by their family or at university, you’re paying only for the board and the actual tuition. And they are paying for everything else.
Gugu Sidaki: 28:41 For sure.
Lisa Linfield: 28:41 Why? Because-
Gugu Sidaki: 28:42 They have to learn.
Lisa Linfield: 28:43 In final year, if you’re doing everything and then one day later they get a job.
Gugu Sidaki: 28:47 It stops. Yeah.
Lisa Linfield: 28:49 How are they going to have the skills here? Because all of us need time to build competencies and skillsets and all of that.
Gugu Sidaki: 28:53 For sure.
Lisa Linfield: 28:53 And I’ll guarantee, as great a job as you do, that there will always be that first month when they run out of money and it all goes pear shaped.
Gugu Sidaki: 29:01 Absolutely.
Lisa Linfield: 29:01 And as parents, you’ve got to let them suffer.
Gugu Sidaki: 29:03 Absolutely.
Lisa Linfield: 29:04 But we are so bad at letting our kids suffer, because we want to save precious.
Gugu Sidaki: 29:10 We save them. Absolutely. In fact, there’s an interesting study I read a few months ago when I was doing research for these books. And they say that children, by the time they’re seven, they formed their financial habits. And you think, how? Because they don’t have money to spend or they don’t have the plastic that they are swiping.
Gugu Sidaki: 29:23 But they’re learning from their parents, or the most dominant adult in their lives. And they learn from doing. So they’re watching you being irresponsible with money. So we have a massive responsibility as adults, as parents, to not only behave responsibly with money, but also to teach them. Because it literally has a direct impact on them. By the age of seven. That’s the shocking part.
Lisa Linfield: 29:42 And it’s not hard. One of the things that we do in our household when we go shopping, is shopping maths.
Gugu Sidaki: 29:48 Yeah.
Lisa Linfield: 29:48 So we look at the kids and we work with them to be able to say, “When we’re looking at these three different brands of milk, how do we choose which milk we take?” And then we teach them about the price and all of that.
Gugu Sidaki: 30:03 Ja.
Lisa Linfield: 30:04 Even the little people. And then as my daughter got older and she could do multiplication and division we’d then say, okay, is it true that a kilogram of cereal is cheaper than the little one? And ironically in South Africa it’s not always there. They say buy in bulk and save, but actually it’s not.
Gugu Sidaki: 30:20 Not really.
Lisa Linfield: 30:22 And that’s every day discussions because you’re teaching your children how to think about spending money, is that it’s in your everyday thoughts. So now you’ve started Nala and The Three Piggy Banks. What is your vision for that?
Gugu Sidaki: 30:37 I’ve been thinking about it long and hard. So like I said, it’s a trilogy. You’ve got the option to get a book at a time or you got the option to get the set. I was doing the numbers. So there’s 58 million people in this country, a bulk of them are young people. If we can get to reach even 10%, 10% of those children with the work that I do. I’m not necessarily saying that everybody should get a copy of the book, but everybody should have access to this information one way or another. If we are able to reach at least 10 people with the work that I do, I think that, that would be a job well done on my part.
Lisa Linfield: 31:11 I think that’s definitely doable. And one of the things that I do in my teaching to help us, which we should also encourage, is that I have a page at the front when I teach them, which says, “As I teach them write down three things that they’re going to teach three other people.” So that you can kind of spread the message a lot further.
Gugu Sidaki: 31:30 Absolutely.
Lisa Linfield: 31:31 And I think it’s definitely a doable thing. Because I think that there is such a need for us to start thinking differently about how we educate children, how we raise this conversation of money. How we change their parts and change their lives. But again, it starts with the adults.
Gugu Sidaki: 31:46 Absolutely.
Lisa Linfield: 31:46 The adults have to be teaching these kids. In 2017 the South African National Statistics released a stat that is 62% of the children born in 2017 were born without a father on their birth certificate.
Gugu Sidaki: 32:02 That’s right.
Lisa Linfield: 32:02 Now the challenge with that is if you are not able to agonize responsibility when the child is born, it’s never going to be enough.
Gugu Sidaki: 32:08 How are you going to teach them about me or anything else. Yeah.
Lisa Linfield: 32:09 So it’s for us to help raise that 62% of all children born.
Gugu Sidaki: 32:15 Absolutely.
Lisa Linfield: 32:16 With the skill set and their moms to be able to do this.
Gugu Sidaki: 32:20 Absolutely.
Lisa Linfield: 32:21 So if people want to get hold of the books and want to get hold of you, how do they do that?
Gugu Sidaki: 32:27 So the books are available on the website, www.my3piggies and it’s the number three. My3piggies.com. And if people want to contact me regarding the books or financial literacy, they can contact me @firstname.lastname@example.org.
Lisa Linfield: 32:41 That’s fantastic. And Gugu, if you could leave with one actionable step or three actionable step, however many actionable steps, that you would want listeners out there to take with respect to their finances, what would they be?
Gugu Sidaki: 32:58 The easiest thing to do, but also the most difficult thing to do is your budget. During the financial planning process when I talk to clients and potential clients, that’s always the one thing that they don’t take seriously. Intellectually, it sounds like a very simple thing to do, but when you actually start doing it, it’s not so easy. I would encourage everyone listening, if you haven’t done your budget to actually do your budget. Print out your bank statements for the last three months and actually track where your money goes. You’d be surprised at how much money you actually find and how much money you’re able to save. A lot of the time we are of the impression that we don’t have enough money for our needs. But I know for a fact that once you start doing your budget correctly, you’re able to find a lot of money that you’re wasting. That’s the most important thing.
Lisa Linfield: 33:42 It always amazed me when people say, “I didn’t even know I was paying that debit order.”
Gugu Sidaki: 33:45 Yeah.
Lisa Linfield: 33:51 How possible do you not know that, that money is going through. I think that’s a fantastic first step. And I think that you’re absolutely correct. It is the pillar of everything, how much money comes in, how much money goes out. And how do we widen the gap so that we can save more money to be able to invest in our futures and our financial freedom. Gugu, thank you so much for joining us. I appreciate your time.
Gugu Sidaki: 34:11 Thank you Lisa.
Lisa Linfield: 34:12 That was Gugu Sidaki. And I am such a massive fan of both her and her 3 Little Piggies. So I definitely suggest that you get those books if you’ve got young kids and that you go and visit her on her website. If you’re wanting to get your money on track, then join us for the six day money sprint. This is a fantastic initiative that so many people have asked me for, and I have really been bad about getting it up and running. But I have it now and every single day for six days, I will send you an email to give you the very next step you need to do in order to get your finances on track.
Lisa Linfield: 34:53 And the best news is it’s totally free. Use it to kickstart your journey to financial freedom. It truly is an amazing experience. And we have a supporter Facebook group, so join us @6daysprint.com that’s the number six, 6daysprint.com. Or you can go to the show notes of this episode and sign up there. I’m so looking forward to getting to know you and I’m really excited by the changes that this can make in your life. I’m Lisa Linfield. This is Working Women’s Wealth. Take care and have a great week.