Woman&Finance is a platform that educates and inspires women to take charge of their finances. We empower our clients with financial tools, tips and techniques through our 1-on-1 personal finance coaching, employee financial wellness programs, workshops & webinars.
To Celebrate International Women’s day, I talked to Kirshni Totaram, Global Head of Institutional Business at Coronation and boy is she a powerhouse! She is a CFA charter holder and a qualified Actuary.
Kirshni grew up with a single mom and money was always tight, but thankfully, she was very good at Maths. Her guidance counsellor advised her to further her studies in Actuarial Science…because naturally that’s what you study when you are good with Maths, right?
And if it hadn’t been because of the bursary she got, she would have not been able to complete her studies.
Giving back & Equality
Because Kirshni has experienced first-hand what education and exposure can do, she started an initiative where she empowers young girls with financial literacy to broaden their knowledge about money management.
Since she grew up witnessing the financial struggle her single mom went through every month, money represented financial freedom to Kirshni and she targeted this financial freedom. From a very young age, she knew that she wanted a different life for herself. She knew she didn’t want to feel anxious and be in a situation where she wondered how she would pay the bills every month.
She says her relationship with money has always been a respectful one. She knows that money is an enabler and a tool to achieve financial freedom.
The excitement of finishing university and earning your first salary can catch even the best of us off guard as we end up with credit cards and store clothing accounts. But Kirshni learned her lesson very quickly as she realised that one needs to pay back the money spend on credit.
That is why educating young girls, especially on financial literacy, is so important to her, to start them off young so they don’t make similar mistakes.
Her best investment so far?
Kirshni believes that her best possible investment has been her education. It is through her education that doors have opened to her. She further says that education is not only limited to the classroom.
With advancements in technology, one can continue to learn and thereby become a lifelong student.
Money advice for women?
Live within your means
Save a percentage of your income every month
Keep at it
Don’t be bogged down by too many options, you can start with a balanced fund and build your knowledge and investment portfolio from there i.e. Coronation Balanced Plus Fund
Takeaway from Kirshni’s story
Kirshni’s background is very similar to many in South Africa, but she still rose above her circumstances and has gone on to become a success.
It is clear from Kirshni’s story that the road to success is not an easy one but equipping yourself with the right tools, i.e. education, passion and determination, will certainly get you there!
If you would like to start your investment journey with Coronation Fund Managers, visit their website on www.coronation.com
Whether you want to start saving, investing or to pay off debt, it might seem impossible with your budget. Well, that’s what most people feel when approaching their finances; that there isn’t enough money to start with. But I want to show you a couple of places to look in your current budget to find the extra fat!
You knew this was coming. Your DStv subscription is easily one of the things you can do without. A full DStv bouquet costs R809 a month (that’s R9 708 yearly).
If you simply cannot do without screen time, you can go for a cheaper option. The compact subscription is R385 a month.
Even better, you can subscribe to Netflix where the basic plan will cost R99 a month, the standard plan R139 a month and the premium plan R169 a month.
But, of course, you will have to take into consideration the cost of data.
Now, don’t go cancelling your insurance. But you can save by comparing your existing insurance and shopping around.
Make sure you match what you have already and your coverage remains comprehensive – this can be your personal insurance, car and household insurance.
You can review your policy documents and see if all the details are correct. For example, three years ago when we were reviewing our policies, my husband and I noticed they had put him as a smoker and he is not.
The policy was revised and the premium changed to a lesser amount. Even if it’s not a lot of money, you still get a saving.
Another culprit is doubling up. I have seen so many people who have income protection cover with both their employer and in their personal capacity.
Income protection provides a monthly income over a certain period of time.
It doesn’t come cheap and if you ever had to claim from your income protection insurance, you would not get both amounts from your employer and your personal insurer.
They would have to aggregate it and you would be paid only one amount.
So, while reviewing your policy documents, make sure you do so in conjunction with your employer benefits.
I ran a workshop with 15 women recently and we discussed expenses that don’t make sense in our budgets.
One said: “I have had a gym membership for the past three to four years and I have not set foot in the gym since then.”
That’s a whopping R500 a month for the past four years that has pretty much gone down the drain.
Even worse, I have seen people with a nationwide membership, which comes at a higher premium than the normal membership, but they have never set foot in their local gym.
Considering that most unit trusts and exchange-traded funds start from R500 monthly, you can certainly put your money to better use.
For the gym fanatics who don’t want to do away with their gym memberships, there are cheaper options.
Instead of going to a gym with a sauna, pool and so on, go for a simple one with the equipment you need but which costs less, for example, Virgin Active vs Viva Gym.
DO A LIST WHEN SHOPPING
This might seem like an insignificant thing to do, but writing down exactly what you need before going grocery shopping can save you a significant amount of money.
How many times have you gone shopping with a “good idea” of what you need around the house and end up buying what feels like the entire shop?
When you write down the list and take it with you, you minimise buying extra things you don’t need.
Better yet, there are stores that offer online grocery shopping and delivery; I find this to be the most convenient way to shop, saving you not only money but time too.
When I finished varsity and started working, I was chuffed that with my two years’ experience, I could upgrade my bank account to private banking.
Mind you, I didn’t earn a lot of money but the “prestige” of having a private banker was alluring.
Needless to say, I used those services only once when I notified my bank of my trip overseas at the last minute, otherwise I had been paying more than R190 a month for this prestige.
I have since shopped around for an option that is still comprehensive but not as expensive. So, do the same and see if your existing bank can offer you more bucks for your money.
And, also look out for those R99 scams, in which R99 is debited from your account every month without your consent.
In a coaching session two years ago, a client had not paid attention to her bank statement.
As we went through her statements as far back as six to eight months, every month there were three deductions of R99 going off her account.
Be vigilant and look at your bank statement often; it might save you money.
In the words of Benjamin Franklin: “Beware of little expenses. A small leak will sink a great ship.”
Tribe, where have you found money in your budget when you thought there wasn’t any?
***this article first appeared in City Press***
You can also Listen to My Money, My Lifestyle podcast below where Maya Fisher-French and I discuss all things money!
My Money My Lifestyle Podcast 23 February 2019 - SoundCloud (881 secs long, 90 plays)Play in SoundCloud
Much has been written about Tax-Free Savings Accounts (TFSA) since they launched but in light of the tax year coming to an end, it is always good to remind ourselves of the benefits of investing in one.
I must say, I have always frowned upon the name Tax-Free Savings Account as I feel that for many people it can be misleading and one might end up thinking of it as just another bank account where you save, not associating it with an investment where you should be thinking long term.
What is a Tax-Free Savings account?
TFSA were launched in 2015 as an initiative by the government to encourage more South Africans to save. When you invest in a Tax-Free Savings Account, any interest, capital gains or dividends from your investment is tax-free, essentially making it a tax haven, albeit a small one.
How does it work?
You can contribute a maximum of R2,750 or R33,000 in one tax year. Anything above this limit, you will be taxed at 40%, making it not worth your while to contribute more to this investment.
While the above numbers may not seem significant, the fact that your investment is free of tax coupled with compound interest, over the long term, investing in a TFSA may prove to be worthwhile.
TFSA also have a lifetime limit of R 500,000 this means that you can only contribute up to R 500,000 in your lifetime into a TFSA and this amount can be reached in just over 15 years if you contribute the prescribed maximum limit every year.
So what does this tell you about investing in a tax-free savings account?
You will only realise and enjoy the real value of a tax-free savings investment, once the value of the investment is sufficient to exceed the annual interest exemption which is R23,000 for individuals younger than 65 (or R 34,500 for anyone above 65) and capital gains exclusion of R40,000. It is therefore best to only invest in a TFSA with a long-term view.
What can you use a TFSA for?
To save for a long-term goal i.e.:
To fund your kids tertiary education,
To save for a deposit for an investment property that will supplement your retirement income, or
How about adding some fun into financial planning and save for a trip of a lifetime around the world? etc.
If you have maxed out the R350,000 limit in retirement funding, you can top-up your retirement saving with a Tax-Free Savings Account, although you will not get the tax break as you would in a retirement fund vehicle.
If you are a freelancer or uncertain about your employment and cannot commit to a fixed amount into a Retirement Annuity. A TFSA allows you the flexibility to withdraw should you really need to.
If you want to save for retirement but there is a possibility that you will emigrate, TFSA might be a good option. While you can access your retirement funds upon emigration, it can be a lengthily exercise.
For estate planning purposes: if your TFSA is in an endowment vehicle, you can choose a beneficiary. Should you become deceased, the funds get paid directly to your beneficiary, avoiding executor fees but not estate duty.
Where to invest in TFSA?
For those who cannot afford the maximum contribution of R2,750, many banks, asset managers and insurers offer TFSA at a minimum recurring amount from R250 only making it an accessible investment for most.
One can invest in TFSA via Exchange Traded Funds, Unit Trusts, and Endowment policies and some fixed deposits, thereby giving you the investor access to different asset classes, i.e. equity, bonds, cash and property.
Almost all investment houses offer a range of TFSA funds, so you do not have to stick to the banks’ offering of a savings account. In fact, considering that a TFSA should be a long-term investment, a cash-based savings account is not necessarily the best vehicle.
Costs involved in investing in a TFSA
There are some costs involved when investing in a TFSA, these can be:
Financial adviser service fee
Platform service fee (in the case of a linked service provider)
Service fee of the fund selected
Providers are currently not allowed to charge performance fees on TFSA.
If one of your new year’s resolutions is to start investing for the long-term, I hope you do consider a Tax-Free Savings Account as part of your portfolio.
So, the Personal Finance Mastery workshop is around the corner and I just wanted to give you some insight into what to expect on the day.
I am super excited as this will be the first of many ‘classroom-like’ workshops I will be hosting. Why go smaller when you can go bigger you ask? Because this way, I get to tackle all your questions, worries and have you walk away with a solid plan of what you should do next in your finances.
I will go through 7 pillars of a healthy financial life:
Mindset – get your mind right
A Budget that works – draw up a budget that you love, one that gives you the enjoyment you want
Debt Blitzer- how to pay off debt and stay debt-free
Start Investing now – practical steps to get you investing within the next 7 days OR review your current investments to see if you are on the right track
Risk – why I need to protect myself and how much is enough
My ‘golden years’ – retirement shouldn’t be boring
Goal setting – future me exercise
And lastly… I give you the inside information into what some financial services companies don’t want you to know!!!
R700 gives you access to the workshop, a money workbook, a follow-up webinar and refreshments on the day.
Think of the Personal Finance Masterclass as the class you never took in varsity, the actual stuff they should be teaching in school…the best R700 you will spend!
Breakfast and lunch will be served on the day accompanied by wine and networking afterwards…wine anyone?
….The proof is in the pudding, right?
This is what my other clients have to say:
I thoroughly enjoyed the coaching session. I appreciate how we went through my bank statements, delved into my spending habits and explored ways which I could limit my spending. You were right when you said CASH IS KING. This has saved me a lot of bank fees as I no longer swipe my card for everything.
After the session, you sent me my budget and detailed feedback of our session. The budget was tailor-made to suit my needs and included everything which I spend my money on ( ie hair, entertainment etc).
Included in the feedback back is a FUTURE ME page. Every time I feel despondent about my finances and feel the urge to splurge I think about FUTURE ME in Italy with my girls, on a fully paid trip sipping someone wine.
During the session, you advised that I start investing. I knew nothing about investing and admit that I was rather sceptical about it. You gave me more information about it in your feedback and encouraged it in our follow up video session. I heeded your advise and now have a Unit Trust, an ETF and a Retirement Annuity where I deposit money every month.
We also discussed the benefits of personal insurance and I can happily say that I have a disability and dreads disease cover.
For “out of nowhere suddenly damaged tyres”, I rest easy knowing that I have an emergency fund to cover all that.
The coaching session made me realise that my finances were not the big bad wolve that I was running away from. The feedback you prepared for me showed me that there were ways in which I could make my money work for me. I learned through the sessions that managing my finances can be fun. I no longer find myself in a state of anxiety every month, wondering how I am going to get through the month.
Thank you for saving a girl some money. Myself and I are going on a date in two weeks to discuss, amongst others, how our money will work for us this December. I promise we’ll think about you.
There is a world of options when it comes to investing. Even a small amount can go far. Stick with it and it will work.
One of the most frequent questions I get is: “What can I invest in as a first-time investor who doesn’t have a big cash flow?”
This question excites me, as there are quite a few options available to investors, regardless of what they can afford. It goes to show that investing is not for the rich only, but for anyone who is willing to be patient and build wealth.
Remember, it is not how much you earn that matters, it is what you do with it that is important. Before you start investing, you first have to think about your time horizon (how long do you want to invest for), your risk profile (how comfortable are you with risk) and your investment goal.
Perhaps before we get into the investment options available, let us emphasise why investing is important. With the rising cost of living, it ensures both present and future financial security. Not only do you end up with more money, but you also end up with another income stream (dividends and capital growth).
Investing is the only way to achieve both growing wealth and passive income.
Easy equities is a cost-effective platform to invest in any company that is listed on the JSE from as little as R250 (once-off or monthly). Another benefit to using the platform is that once you have registered for free, you can create a demo account that allows you to get comfortable and teach yourself more about investing before you invest real money.
However, there is a 15-minute delay in share prices (you can counter this with looking at websites such as Moneyweb or the JSE website). www.easyequities.co.za
Impact investing is relatively new to the South African markets but it is exciting nevertheless. With more and more people looking to invest responsibly and sustainably, more people are drawn to impact investing. What is impact investing?
It is a rapidly growing industry, powered by investors who are determined to generate social and environmental influence, as well as financial returns.
One of South Africa’s first is the Fedgroup app, which enables you to invest as little as R300 in blueberries. Their tagline is “Earn the profit without getting your hands dirty!” and it does exactly that. You own the assets on the farming venture you choose, whether its blueberries, solar panels or honeybees. www.fedgroup.co.za/ventures/ impact-farming
The unit trusts fund is a pooled resource, which allows a group of investors to combine their cash and invest. It represents a mixture of the securities of the underlying fund. One of the major advantages to unit trusts is the reduction in investment risk by way of diversification as well as having a professional manage the fund, taking away the stress from the investor as to which companies to invest in.
While most asset management firms start with R500, there are a few which take a lower monthly premium. For example:
•PSG Fund Managers
•Old Mutual Unit Trusts
•Coronation also ran a campaign to celebrate their 25th birthday, where you can invest as little as R1. www.becauseitsyourmoney.com/
Unlike unit trusts, exchange-traded funds (ETFs) are not actively managed but instead are passively managed. ETFs track an index, for example, the JSE Top 40, meaning that the cost of investing in ETFs is lower than that of unit trusts.
Satrix, CoreShares and Easy Equities offer exchange-traded funds. They all range from R250 recurring or once-off. www.satrix.co.za www.coreshares.co.za www.easyequities.co.za
TAX-FREE SAVINGS ACCOUNT
Tax-free savings accounts were introduced to encourage a savings culture in South Africa. It is one of the most effective ways to save for a goal because any interest, dividends or capital gains from your investment will be free of tax.
It is important to note that tax-free savings accounts are accessible through the investment platforms already mentioned.
You simply need to select which option. It is advisable not to contribute more than the annual limit of R33 000 (or R2 750 a month), as you will be taxed on any amounts after that.
This article first appeared in City Press.
Ps. Join me this Saturday for the Personal Finance Mastery workshop
This year, I will be giving away more downloadable resources to help you on your financial journey. My whole aim is that each and every one of the Tribe becomes confident about their personal finances, no matter where in the journey they are. I want to show you how easy and (possibly fun) having control of your money can be.
Today, I have the Net Worth template for you to download. I often say that this is one of my favourite calculations because it reflects how my financial decisions are impacting my net worth. Whatever your net worth is, I hope this template will encourage you to reach for even better in your personal finances.
It’s a simple but powerful calculation of Assets minus Liabilities.
If you are joining me on the 2nd February for the Personal Finance Mastery workshop, I will help you do this calculation, work with you to set S.M.A.R.T goals to squash debt and increase your assets, thereby increasing your Net Worth… whoop whoop!!!
Hi Tribe, all the time you hear me say educate yourself, educate yourself right? I believe that if you want to become good at something, you have to spend time educating yourself and improve your skills.
You might not want to teach personal finance but for you to master your money, you need to at least build a foundation.
So, what websites, TV shows or content do I like to consume to help me be better at my money and get inspiration to give good, valuable content on Woman & Finance?
HERE ARE MY TOP 5 (…so far)!
Stock Watch on DSTV channel 412 (Business Day TV)
Now you know why I will never completely let go of DSTV! I love the show because it’s a South African show and it talks about stocks/shares on the JSE, which I can relate to. Everyday on the show, guests answer questions about specific shares from the viewers; this gives you a sense of which shares investors and experts like and don’t like.
Channel 412 Business Day TV in general has really good content on all personal finance and money matters. It’s the one channel that stays on at my place.
Maya on Money
If you follow Woman & Finance closely, you will know I did a podcast on Maya Fisher-French, now Maya for me is the OG money maven! When I started working at my previous job, I remember telling the marketing guy that I want to start a blog on personal finance (that was in 2013!) and he directed me to Maya’s website. I have loved her since. Her advice is solid and she has the experience and skill to back it up.
Again, DSTV!!! I have to admit, sometimes I don’t fully understand what they are talking about but I love getting a sense of what’s happening in the world market. We do not operate in isolation. Remember in the 2008 world recession, the saying was- if the USA/Europe sneezes, the whole world catches a cold.
Bloomberg also has a mobile app if you are not on DSTV premium.
Moneyweb has been my source of information for as long as I can remember; they have the most relevant news on investing and personal finance and they explore how current affairs affect our money. Their content is so valuable that they have free subscription and paid subscription. Their paid subscription is around R63 per month, giving you insights and more valuable information you can access at anytime.
Check it out on: www.moneyweb.co.za
The Money Show with Bruce Whitfield on Talk Radio 702
Really one of my favorite shows on Radio, I love how Bruce breaks down personal finance with his guests. He interviews leaders in business and they talk about how they manage their money. (If you want to be rich, learn from those who have walked the path!)
Catch him everyday at 6pm on Talk Radio 702
What are some of your favourite websites, podcasts…content to consume to get better with your money?