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The Money School Weighs In On What’s Really Stopping You From Financial Freedom

76% of the average South African salary is servicing debt. This is causing massive financial stress for blue and white collar workers alike. Do you know how your workforce is affected by debt? Are your engagement and productivity levels suffering? Hayley Parry and Gary Kayle of The Money School unpack the truth about financial stress.

Nadine Todd

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Vital Stats

  • Players: Hayley Parry and Gary Kayle
  • Company: The Money School
  • What they do: Independent, scalable financial education solutions for businesses — both their employees and clients.
  • How: Online, in-person or at one of 44 Boston City Campuses nationwide
  • South African education in 2016: 18 738
  • Financial services products sold: 0
  • Coolest tech: Artificial Intelligence infused customer support through their Money Coaching™ team
  • Visit: themoneyschool.co.za

What is the reality of financial freedom?

People want to be wealthy,
but instead they live in debt. Rising indebtedness, lowering disposable income, using the bank’s cash to gear your lifestyle or living above your fighting weight have become the norm. People are financially dependent, but should be financially independent.

Related: What Makes a Good Financial Management System?

Money problems affect employee productivity and efficiency

The reality is that people will job hop for an additional R3 000 — sometimes even less. They believe they’ll get their affordability back with a little bit more money; unfortunately this is rarely the case. Instead, they just spend more.

High indebtedness impacts staff productivity
and ‘presenteeism’ because the average South African employee spends three hours or more per week on financial problems and 45% worry about money daily. It’s difficult to concentrate on work responsibilities when you’re always stressed about money.

We find employees start to resent their employers, believing they are under-paid, when in fact their problems stem from debt and the mismanagement of their primary wealth building tool — their salaries.


Fast Fact

In the US the highest number of dollar millionaires are teachers — not because they earned high salaries, but because they were good with their money. 80% of dollar millionaires come from the middle earning bracket.


Is this predominantly a blue collar worker problem?

Not at all. No one is immune. White collar workers are as, if not more, affected by debt. For example, we recently ran our course with a company of 300 employees, all of whom were white collar workers.
We always begin with a survey to gauge the financial health of each individual taking the course. When asked how many people could deal with a R5 000 financial emergency, only 27% of the group admitted they would be able to without taking on more debt. After the five-week course, this had risen to 57%.

No one was earning a larger salary, but they did have a better understanding of their own money. 92% were worried they were making the wrong financial decisions, and 63% spent more than they made. These had reduced to 13% and 27% respectively two months later.

The level of indebtedness we are currently facing means that the average South African gets poorer the longer and harder they work. Our aim is to equip people with the skills and confidence they need to eradicate debt and achieve their financial and lifestyle goals.

Related: 7 Ways To Be Debt Free For The Rest Of Your Life

Why is this something that employers should care about?

It directly impacts their bottom line. Money stress affects all aspects of our lives. The larger an employee’s debt, the higher this stress. This has a knock on effect on their health, productivity and even attendance at work. With 76% of employees’ take home pay spent servicing debt, it’s no wonder that 9 out of 10 South Africans will not be able to afford to retire.

What is the solution to this dilemma?

the-money-school-south-africa

And independent financial education. Whether it’s self taught, or taught at schools, varsities or the workplace (or preferably all three) it’s important that everyone is educated and empowered to take control of their financial future without being sold financial services and products at the same time.

As a team, we understand this issue from various angles. Hayley’s background in financial media helped us package our content in an engaging manner — particularly online — which was key to scaling our business. Gary has an intimate understanding of the unhealthy relationship we can quickly form with money, particularly when we start earning decent cash for the first time. In his first job as a salesman, Gary was romanced by debt, flashy cars and gold credit cards. He was converting hard work into debt.

It was this experience that gave him an intimate understanding of the problems most people face when it comes to money and he was determined to help others once he’d figured out how to help himself. After a stint as a broker he realised how wide-spread this problem was and how everyone needs a financial education irrespective of their salary bracket or professional qualification.

What should people consider when thinking about financial wellness?

The first is that our financial planning tends to be reactive instead of proactive. If you want to achieve financial freedom this has to change. We have
a genuine desire to see South Africans live better, healthier financial lives, but this starts with a long-term view of growth.

Only 3% to 6% of South Africans will retire financially independent. 94% of South Africans work their entire lives and end up broke, and this includes a lot of high net worth individuals. Income and wealth are not the same thing. There’s a huge difference between wealthy and rich people, starting with the fact that wealthy people sleep at night, and aren’t constantly stressing about money.

The average age of a person in debt counselling is 36. Basically, they’ve worked just long enough to get into real debt. How much they earn isn’t important in this scenario though. Most people are broke between the 15th and the 20th of the month.

We’re in the business of helping people understand what it is that wealthy people know and do differently — irrespective of what they earn. If you can help your employees focus on building a sustainable financial future, you’ll be freeing them from stress and debt whilst ensuring you reduce your staff turnover, and improve the productivity and health of your employees. It’s a win-win.

Related: 5 Ways To Get Out Of Your Student Loan Debt

Where can you start building wealth?

Everyone should value their salaries, not for the debt that their salary allows them, but the opportunity to build wealth. Debt does the opposite. It stunts personal growth, because no matter how hard you try, you’ll never get out of debt if you
can’t manage your money.

Financial freedom is not linked to how much you earn, but how much you save. Financial literacy just doesn’t cut it. Anyone can be financially intelligent with the right coaching and focus.

What type of commitment does it take to achieve financial freedom?

It takes five focused years to make a significant dent in building assets — that’s it. You need to put them in place and then let them grow. Yes, it takes patience, but it’s a focused, disciplined patience. Hope is a terrible strategy. The key to financial freedom is the consistency of application.

Everyone needs to know their number. What do you need to be investing now to maintain the life you want when you stop working? Until you can afford that, don’t spend on other stuff.

This is not about losing people in the technical elements of good financial planning. It’s about freeing your mind, lessening stress levels, and spending more time doing what you love.

Anyone can be financially independent. Financially free does not mean super wealthy. It means living debt-free, saving and investing, and living life on your terms.

Top management tip

If you’re holding weekly meetings with your team, make sure they’re worth the time and effort everyone is spending in a meeting instead of working.

Follow the WWW framework: Who, What, When. At the end of the meeting, take a few minutes to summarise who said they are going to do what and by when. This isn’t about micromanagement — it’s about clear communication and ensuring accountability from all team members, the foundation of strong, sustainable management.

Take note

Debt is detrimental to your employees’ engagement levels. The higher an individual’s financial problems, the more disengaged they will be due to severe financial stress.

Nadine Todd is the Managing Editor of Entrepreneur Magazine, the How-To guide for growing businesses. Find her on Google+.

Lessons Learnt

Here’s How Bosses From Hell Helped 6 Entrepreneurs Grow

From control freaks to being unco-operative, founders share what they learned from their worst boss.

Entrepreneur

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In business, sometimes the most valuable lessons come from the worst teachers. We asked six entrepreneurs: What’s the greatest thing you learned from a bad boss?

1. Bring everyone in

“A former boss was very hierarchical and discouraged collaboration. Everyone reported directly to her, and interdepartmental meetings were practically prohibited. It meant that only our boss had the full picture – we missed a lot of opportunity for alignment and cooperation. Today at our company, it’s a priority to hold regular team meetings and foster a strong culture of collaboration. It’s crucial that our team members weave collective sharing into the fabric of their day-to-day interactions.” – Melissa Biggs Bradley, founder and CEO, Indagare

2. Be vulnerable

“Don’t be afraid to show your emotions! I worked for a partner at McKinsey who was an incredible person but an awful manager because he kept his feelings bottled up. After a client presentation went awry, our team didn’t know where we stood with our manager. It was tense, awkward and demotivating. Showing vulnerability and letting others know when you’re genuinely upset can help everyone externalise their emotions, build trust and reassure employees that they aren’t alone. It sends a clearer message than stone-faced silence.” – Leo Wang, founder and CEO, Buffy

Related: 5 Factors That Make A Great Boss

3. Lend a hand

“I worked for someone who would never help out the junior staff with their work, even if he was finished with his own – he’d simply pack up and leave early. I now make an extra effort to ask my staff if they can use a hand when my own workload is light. It’s created a culture that feels more like a tight-knit team and less like a hierarchy.” – Adam Tichauer, founder and CEO, Camp No Counselors

4. Move as a group

“When I was a nurse manager, I had a boss with no experience in healthcare. She wanted to change our process for keeping patients from getting blood clots. I knew it was a mistake, but she insisted. Ultimately, the change failed. It taught me the importance of empowering staff to speak up. At Extend Fertility, we collect feedback from customers via surveys. Results are shared with our staff, and together we develop action plans to address negative experiences. It’s the employees who interact with patients on a daily basis who have the best solutions.” – Ilaina Edison, CEO, Extend Fertility

5. Trust your team

“I once worked for a woman who joined our team after I had been working there for a while. Every time I stood up, she’d ask me where I was going, whether it was to the bathroom or to the printer. She had a fear of not having control over my time and work. As a young adult, this behaviour really demoralised me, especially since I had excelled at the job for years prior. My leadership style is less neurotic. Once my team members have my trust, I’m pretty hands-off.” – Denise Lee, founder and CEO, Alala

Related: 5 Leadership Questions Every Boss Should Ask

6. Respect others’ time

“Early in my career, I had a project manager who’d wait until the very last minute to review work, then convey lots of new information and requests. This happened at the end of the day or, worse, after hours, when I was home. It was demoralising, inefficient and disrespectful. In my career, I’m conscious about reviewing work in a timely and complete way so my team can successfully incorporate my feedback without generating a last-minute crisis – or lingering resentment.” – Kirsten R. Murray, principal architect and owner, Olson Kundig 

This article was originally posted here on Entrepreneur.com.

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Lessons Learnt

11 Things Very Successful People Do That 99% Of People Don’t

Consistency is a big part of succeeding. The top 1% of performers in the world know this is the secret to their success.

John Rampton

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Becoming wealthy and leaving an impact on the world is not an easy feat. If it were, everyone would go around doing it. At that point, it would not be much of an accomplishment at all.

Rather, being extremely successful requires an extreme amount of work. Especially when there is nobody looking. The best people have developed habits that help them reach their goals. These routines are not necessarily challenging to form, but they take consistent effort over extended periods of time. Creating these tendencies in your own life will propel your success.

Here are 11 things, that 99% of people (myself included) do not do, but really should.

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Lessons Learnt

Brian Tan Of FutureLab.my – Bridging The Knowledge Gap Through Social Learning

Brian Tan a young Malaysian Entrepreneur whom has built the largest social learning platform in South-East Asia.

Dirk Coetsee

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“The meaning of life is to find your gift. The purpose of life is to give it away” – Pablo Picasso

As a keen observer of the behaviour of successful entrepreneurs I have learnt that:

“You do not attract what you want but you attract what you are”

Brian Tan truly believes in what FutureLab stands for and therefore has attracted the belief of key partners such as Cradle whom has invested in his ground-breaking project.

Brians’ gift is to solve big problems. In unison with his two other co-founders he is giving this gift away in the Form of FutureLab, a company obsessed with learning and more specifically bridging the gap between education and careers.

Brian wants to play a role in making humanity better by applying his knack for solving unique problems and firmly believes that quality and ongoing education is a powerful catalyst for positive change. FutureLab is a social learning platform featuring diverse applications that not only connects mentees to mentors but also empowers several companies to track their employees utilising Futurelabs’ technology as they navigate through development and talent development programs.

Slowly but surely FutureLab is becoming much needed feedback loop between university and industry and brings exposure to people who have not had it before. Brian believes that a lot of people have not fullfiled their potential due to low standards of education in general.

Related: Channeling The Fire Of Authenticity: Asia’s’ Top ‘YouTuber’, Joanna Soh

I fully realised that I was engaging a modern entrepreneur as he described his company culture as:

‘Geeky, awesome & badass.’

He elaborated on that by explaining that his team do not follow trends, that they authentically like what they like, and do what they love in their unique way. When you act according to the Leadership principle of Authenticity you avoid having regrets as you did not apply unnecessary energy to attempt to become someone that you are simply not.

This unique company is founded upon three core values which flows through all the activities that they engage in:

  • Giving back to society
  • Continuous Learning
  • Creating your own reality.

The FutureLab team does not only pay lip service to these values but instead actualise them as a matter of regular practice. Brian gives his team ‘homework’ in terms of things that they need to learn and the CEO of FutureLab himself is engaged in a lifetime commitment to learning. Regular ‘Stand up meetings’ are held were team members give feedback and hold each other accountable.

Brian is a Biochemist by trade whom constantly seeks opportunity to learn more about business and has completed several business programs to learn how to build a company which included spending 3 weeks at Stanford University studying entrepreneurship and meeting teams from Google, Apple, Facebook and Pinterest as part of a government initiative for the top 25 Malaysian start-ups. This young entrepreneur believes that his passion for teamwork has helped him a great deal to transform from being a biochemist to being an entrepreneur. He finds joy in ‘pushing a team forward’, as he puts it and loves seeing his team members grow in self-confidence and belief in the vision of the company that he co-founded. He has a keen knack for finding potential and then helping his team members to unleash their inherent talents.

What follows is Brians’ clear description of how Futerelab obtained cradle funding and how they managed to secure the top universities in Malaysia as clients, in his own words:

“We wanted to prove that FutureLab was solving an actual problem before applying for Cradle funding so what we did was to invite mentors from specific industries (at this early ideation stage of FutureLab it was our own personal networks).

“We started with mentors from Management consulting and posted a google form up on Low Yat and Facebook to see whether anyone wanted to speak to them. Within a couple of days, we had 20 people signup to meet our mentors. At this point, we decided to close the google form since we didnt know what kind of people would show up. We set the meet up at a local coffee shop and only spent RM 50 on buying coffee for the 5 mentors from Accenture, BCG, PWC, Ethos Consulting and Deliotte. We split the mentees into mini groups and they cycled from one mentor to the next, the last stop for each mentee group was with me telling them what we are trying to build, how much we are thinking of charging and how would the system work. We got really good feedback from the participants and the mentors.

Related: Meet Jan Grobler: Serial entrepreneur, Advocate, And Job Creator

Me being a scientist by training, I like to see whether results are repeatable so we organised 6 of these meet-ups over the whole year inviting mentors from different industries, lawyers, accountants, entrepreneurs, doctors and we even tested on online mentoring session using google hangouts. At this point, we were convinced that FutureLab should exist. This is when we applied to Cradle for Funding along with all the evidence we collected on why FutureLab should exist.

When FutureLab was first launched, we already had 40 mentors and 60 mentees that were waiting to use the platform that we were building. Mentees really enjoyed speaking to our mentors and vice versa for mentors, our growth has been mostly from word of mouth from mentors and mentees eventually universities started being aware of our mentoring community and started asking us to get more involved with their students. Our mentors are big advocates for our platform and they are based in large companies around the world. So they play a big role in opening doors for us.

Yet another key business learning he has acquired is to always guard against complacency and this knowledge is encapsulated by the following quote that he shared:

“What got you here cannot get you there”

Meaning that the same behaviours and habits that got you to this point will not be enough to move you forward, you have to keep on evolving to remain relevant and successful.

Brian is passionate about FutureLab and business in general and reminds us that:“When you are passionate work is the fun part of the day”. His advice to other entrepreneurs is to truly find a project that you are passionate about and truly believe in. He is most certainly passionate about the future of his projects and wants to build an eco-system that generates high volumes of cash that will empower his company to invest in start-up projects.

In general he wants to invest in entrepreneurs that are solving ‘big problems’ and wants FutureLab to become an innovation company. He poses this challenging question to those thinking on starting their entrepreneurial journey:

‘Are you merely attempting to do what others are already doing or are you really solving a problem?”

He finds that many entrepreneurs overthink and then do little. The more you do and if done at a rapid pace the more you learn to become adaptable and will find that there are many ways to solve a problem.

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