The true motivation behind financial freedom is to live our dreams, says financial expert Maya Fisher-French – follow the Money Makeover contestants
While the contestants have focused on shorter-term goals over the past six months, their journey has just begun as they share their plans for those bigger dreams as the Absa/City Press Money Makeover draws to a close.
Renovate: without debt
“Our big dream is that our son will be 100% healthy. While we can’t control that, at least there’s less financial stress at home, which adds to possible healing because we all know stress is a killer,” says executive PA Catherien.
At the beginning of the year the family bought their first home, a real “fixer-upper”. The big dream is to renovate the house by the end of the year with cash. “No loans, no debt! We’re making a priority list, getting quotes for what we can’t do ourselves and saving up until we can do it.”
Cattle farming: create a strategy
Area manager Colen’s long-term dream is to own a cattle farm. He needs to plan carefully, save and do his homework so the dream doesn’t become a nightmare. “Operational costs will be incurred for a long period of time before any income is generated,” says Absa financial adviser JP van der Merwe who recommends Colen start by buying some cattle and grazing them in another farmer’s pasture.
Going back to school: plan for all costs
Although his employer will subsidise his studies, he’d have to pay the money back if he fails the course or resigns. “I need to plan around it, so my adviser, Johan Frouws, recommended I put money aside for those extra studying expenses such as registration and examination fees,” says Mishack. If you’re planning on studying make sure you include registration costs, books and exam fees.
Creating a legacy: income-generating investments
“My husband and I have a vision to have more properties so that generations to come have options we didn’t have and use that to realise their dreams,” says TV producer Nono who also plans on growing her Salt and Light beauty product line. Nono has paid off her credit card and her car will be paid off by December, so the couple will make extra payments to their flat while saving an additional amount for a deposit for a new one
Own business: use the time now to plan
“I still have a dream of setting up my own business, ideally in the IT services space as that’s what I know and where my skills are,” says consultant Peter who adds that the first step is to decide on the exact services he wants to offer. “I’ll make use of my current network to get the first contracts. I’ll have to wait and see the outcome of the Covid pandemic, as I’m sure budgets will more than likely be cut. This will also give me time to grow my emergency fund.” As an interim measure Peter is going through the process of registering a business with the Companies and Intellectual Property Commission. “It might just be the catalyst for me to get out there and do something about it!”
Create a family business: get them started
Construction entrepreneur Bellah wants to build on her business and give her son a role to create a true family business. She’s already started to diversify and find new customers, with her son learning the ropes and managing some of her new contracts.
How to save for a dream
- Know what you need: A dream requires research, not only for financial goals, but there may be other building blocks you need to put in place.
- Break it down: Work out how much you need. As a simple exercise take the amount you need and divide either by the amount you can afford to save each month or the number of months to work out what you need to save.
- Choose the level of risk you’re willing to accept: While cash may work for shorter-term goals, if you’re looking at a term of 10 years you need a market- related growth investment to try to outperform inflation.
- Regularly review your goal and progress: Keep track, top up and keep dreaming.
Join personal finance expert Maya Fisher-French for the Absa/City Press Money Makeover Final to find out which of our six contestants won the grand prize. Register for the final here.
You can follow the journey on social media #CPMoneyMakeover