Moroka Modiba - Think Yourself Rich: A step-by-step guide to financial independence

Published by Penguin Books

an imprint of Penguin Random House (Pty) Ltd

Company Reg. No. 1953/000441/07

The Estuaries No. 4, Oxbow Crescent, Century Avenue,

Century City, Cape Town, 7441

www.penguinrandomhouse.co.za

First published 2017

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Publication Penguin Books 2017

Text Moroka Modiba 2017

Cover image Designed by topntp26 / Freepik.com

All rights reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted, in any form or by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior written permission of the copyright owners.

PUBLISHER: Marlene Fryer

MANAGING EDITOR: Ronel Richter-Herbert

EDITOR: Christa Bttner-Rohwer

PROOFREADER: Ronel Richter-Herbert

COVER AND TEXT DESIGN: Ryan Africa

TYPESETTER: Monique van den Berg

ISBN 978 1 77609 293 2 (print)

ISBN 978 1 77609 294 9 (ePub)

Disclaimer

Every effort has been made to provide the reader with accurate and sound information. Since it is not the intention of this book to replace professional advice, the author and publisher take no responsibility for any loss or damage suffered by any person as a result of reliance upon information contained in this book. All quoted figures, legislation details and URLs were current at publication.

Contents

For my mother, Freda Rahab Modiba

Rutang bana ditaola le se ye le tona badimong.

(Lets teach our children knowledge and wisdom before we die with it and join the ancestors

Sepedi proverb.)

This African proverb has a strong message aimed not only at our elders, but at anyone who possesses knowledge that can help others. All of us have the responsibility of sharing our knowledge to preserve it, so that we can evolve and progress as people.

My grandfather never worked for a bank or for any financial institution. But his knowledge of money and how it worked was as solid as that of any financial expert I know. He knew the basics and understood them very well. He was a man who managed to raise nine children on the salary of a farm labourer. This alone deserves him a round of applause. He was the spark that lit the fire in me to want to know and understand more about money and wealth. That fire led me to study finance at university, move on to work in a bank, various insurance companies and a stockbroking firm before starting my own business in the financial industry.

He is the inspiration behind this book. I truly appreciate the timeless wealth of wisdom and knowledge he bequeathed to me. I hope that my readers will also gain from the wisdom and knowledge that he passed down to me. He remains my role model to this day.

An investment in knowledge always pays the best interest.

Benjamin Franklin

Why do you think so many working people look so happy and confident at month-end? asks my frail grandfather from his hospital bed after heart surgery.

They are happy because they just got paid, I reply. I laugh, because I can relate.

Yes. And most of them will be penniless the next day, when the debit orders have run through their bank accounts. But for the few hours they have money in their bank accounts, they feel happy. They feel invincible. They walk and talk with confidence. They smile and laugh.

Now imagine if they could feel like that forever. Imagine that. And you know what? All it takes is for them to keep some money in their bank accounts or in their pocket. Thats all!

His coughs interrupt his story.

Im sitting quite still next to his bed and Im listening carefully to his words. I know very well that any word could be his last. The doctors instructions were very clear when I entered the room: he must not talk; he must rest. But I guess my grandfather feels obligated to give advice to his grandson who has just started at his first job.

Always remember that its not how much you make, but how much you keep. Even if you earn as little as R1 000, then take R100 and put it away. This will not only help you during the rainy days, but will also boost your inner confidence. And the more your savings grow, the more confident youll become. There is nothing as amazing as a confident person. A confident person can do anything and I mean anything! Do you know why? Because theyre not afraid to fail. Somewhere in the back of their minds they know that if they fail, theyll have something to fall back on. So confidence is everything, my son. It will open up doors of opportunity for you. But you have to start saving as early as possible. Start with whatever you have and build on it. Dont wait for a promotion or a salary increase to start saving. Work with whatever you earn. Dont let

He struggles through another cough attack, this one more serious.

The nurse rushes into the room and assists him, holding a glass of water to his mouth. She asks me to leave so that he can rest. I leave reluctantly.

This conversation with my grandfather has stayed in my mind ever since. It planted a seed that has kept growing in my mind to this day. Its growth has opened up a world of unlimited possibilities. And while words cannot begin to describe the impact his message had on me on that day, I believe that practice will reveal its magnitude. Its benefits are both tangible and intangible.

I learnt very quickly that creating your own financial wealth and building your inner confidence is a journey. Though my grandfather planted a seed that day and it germinated, I still had to fertilise it, water it, prune it and get rid of pests that attacked it. I also had to know how much water, fertiliser and pesticide I should apply, and when and how. This is how my journey began.

But here is a word of advice before you proceed with this book. Although Im sure you have heard it often, Im obliged to repeat it. There are no get-rich-quick schemes in this book. Your journey to financial independence is not a 100-metre sprint its a marathon! If you want to be a sprinter like Usain Bolt, then you should be reading his training programme; if you want to run a marathon, youd do best to heed information from Haile Gebrselassie!

Right now you are looking at a road map for your journey towards financial independence. This journey, above all, starts with planning. It involves budgeting, drawing up a financial plan and getting rid of all unnecessary debt, and then saving for emergencies and investing surplus money wisely to build your wealth and achieve financial freedom. If you follow these steps patiently and diligently, you will create wealth for yourself and for generations to come. Its that simple. So, tighten the laces on your sneakers, stretch, warm up, and begin. All the best!

Failing to plan is planning to fail.

Alan Lakein

A few days after visiting my grandfather in hospital, there I was again, sitting next to his bed. I wanted to find out more about his views on money. Although he had never worked in a bank, I realised that his knowledge of money came from the heart and was absolutely sound. Every time I asked him about this topic, his wrinkles relaxed and his eyes started sparkling. I would spot a smile beneath his white beard, because this was what he enjoyed talking to us about the most. Maybe it was because he knew that he wasnt leaving a great fortune behind, so the best thing he could do was pass on his knowledge and wisdom.