The Proof is in the Pudding!! My Financial Diary.

Okay guys, it is time! Time for what you may ask? Time to not just read about other people making money but to do it myself. I read in another topic that the person reached a 2 million rand target. Good for him.
What is preventing all of us from reaching that goal? Nothing, absolutely nothing. We have the internet for information and knowledge. We have investment instruments and banks. So what is holding us back?

I am going to put it to the test. The Proof is in the Pudding!!

I will start my financial diary with....... R500! That's it. Nothing more. Most of us only have R500 spare per month.

I will welcome any and all financial advice. That advice must come via this forum for all to see. The information must be accurate and in detail. I don't want to guess anything. Full transparency!

I only have 2 rules. 1 - I am not going to see any financial adviser or visit any bank or phone anybody. If I can't do the investment via my computer from home, then I'm just not interested. After all, most of you are working and don't have time for other stuff. Am I right? If I can't get the information from the website where I want to invest my money, then I will say so and name and shame. I will do all communication with institutions via email so I can post it in this forum. If there are any advisers out there, they are welcome to give their comments on here for all to see. 2 - This is going to be very hard. I may never ever use any of that money till I reach my first goal of R10 000. If the car needs tyres, tough luck. Walk or join a lift club or use public transport.

So, on the 25th of July 2014, I am going to make my first deposit/investment and I will be adding R500 per month there after.

I will reflect every transaction and every fee deducted. Let's see who you can trust and who the sharks are!

My first goal: To make R10 000 in the shortest time possible.

To any and all institutions, this is it. I am going to test you and as I stated earlier, name and shame. So get your ducks in a row.

To all those that want to join me in this venture, get ready for a wild ride. Who's with me?

I WANT TO MAKE ONE THING VERY VERY CLEAR. DO NOT MENTION ANY CUT-BACKS! I HAVE DONE THAT. IT IS THE FIRST THING EVERYBODY SHOULD DO BUT THERE ARE SO MANY THINGS YOU JUST CAN'T CUT BACK ON AT ALL AND IN MOST PEOPLE'S CASES, NECESSITIES TAKE UP 95% OF THEIR PAYCHECK.

Coronation Top 20

Bold project.

>I will welcome any and all financial advice.

At that scale you can make serious progress via pure discipline & planning of expenses. i.e. Pack lunch vs McDonaolds will help you more than clever financial tricks.

Thanks Goobie. I will investigate this option and give my feedback.

HavocXphere said:

Bold project.

>I will welcome any and all financial advice.

At that scale you can make serious progress via pure discipline & planning of expenses. i.e. Pack lunch vs McDonaolds will help you more than clever financial tricks.

Click to expand...

No no no. I did not say scale down on life. I am tired of hearing that I should scale down. Most people have scaled down and can't scale down anymore. They have scaled down so much, they don't know what life is anymore.

There are 20 000 websites telling us how we can invest for our future. Well I want to know how to invest for my future without having to cut back a cent. Your comment is appreciated, but this is a test, an investment test. First we test the internet presence of all these institutions and secondly, if average Joe can become a Warren Buffett in the South African environment.

But once more, thanks for your comment.

LottaFun said:

No no no. I did not say scale down on life. I am tired of hearing that I should scale down. Most people have scaled down and can't scale down anymore. They have scaled down so much, they don't know what life is anymore.

There are 20 000 websites telling us how we can invest for our future. Well I want to know how to invest for my future without having to cut back a cent. Your comment is appreciated, but this is a test, an investment test. First we test the internet presence of all these institutions and secondly, if average Joe can become a Warren Buffett in the South African environment.

But once more, thanks for your comment.

Click to expand...

Well I hope you're ready for some hardcore risk taking then...

You're looking at 2 scenarios here

1) Hardcore risk taking...uncertain outcome
2) No hardcore risk taking...R10 000 goal / R500 pm = 20 months minus maybe 1 for interest/returns

Anyone giving financial advice here better be very wary because, sadly, it is now illegal unless you are registered and do a needs assesment...

*subscribes to read later*

dunkyd said:

Anyone giving financial advice here better be very wary because, sadly, it is now illegal unless you are registered and do a needs assesment...

Click to expand...

I challenge you to back that with legal references. Go...

Actually...no. Might as well save myself some arguing and tell you that you're wrong...mybb is free incidental advice that is not being charged for and thus exempt.

Put R500 a month into a mutual fund that has a good track record, like Alan Gray, Coronation. Their websites will give you the past history and while past performance is no guarantee of future growth, it does how you if they have been consistent.

Are you sure you can't manage more than R500? At least start off with this, and if you have some spare cash, or get a bonus, include this as well. Always re-invest dividends

Remember: Compound interest is your best friend long-term

LottaFun said:

No no no. I did not say scale down on life. I am tired of hearing that I should scale down. Most people have scaled down and can't scale down anymore. They have scaled down so much, they don't know what life is anymore.

There are 20 000 websites telling us how we can invest for our future. Well I want to know how to invest for my future without having to cut back a cent. Your comment is appreciated, but this is a test, an investment test. First we test the internet presence of all these institutions and secondly, if average Joe can become a Warren Buffett in the South African environment.

But once more, thanks for your comment.

Click to expand...

Hi Lotta

I do not generally like to share my personal financial info in public, but I thought you might be interested.

In 2012 I decided that I was sick of living month to month and decided to make a change. I had finished paying off my car and decided I was not going to buy a new one. I cancelled all non essential services and removed all debt. I optimized my banking, insurance etc to the lowest accounts possible.

I cancelled all phone contracts etc. I still use an old BlackBerry. I didn't make any toy or tech purchases.

At the end of it all I had R15k to save every month. 7 months later I had saved my first 100k. It felt great.

I decided I needed to make my money work for me. I invested in AngloGold Ashanti. I made 15k in a few months and learnt how to invest on the JSE. I continued to invest my savings.

Right now my portfolio is close to 200% growth and I have over a million cash in the bank.

frailwings said:

Hi Lotta

I do not generally like to share my personal financial info in public, but I thought you might be interested.

In 2012 I decided that I was sick of living month to month and decided to make a change. I had finished paying off my car and decided I was not going to buy a new one. I cancelled all non essential services and removed all debt. I optimized my banking, insurance etc to the lowest accounts possible.

I cancelled all phone contracts etc. I still use an old BlackBerry. I didn't make any toy or tech purchases.

At the end of it all I had R15k to save every month. 7 months later I had saved my first 100k. It felt great.

I decided I needed to make my money work for me. I invested in AngloGold Ashanti. I made 15k in a few months and learnt how to invest on the JSE. I continued to invest my savings.

Right now my portfolio is close to 200% growth and I have over a million cash in the bank.

Click to expand...

Congrats!

Well if you are bold, lucky and or knowledgeable like the above that is probably your best route.

From my experience, I revisited my debit orders, cancelled contracts I didn't really need, revisited my medical aid and then I went and had a look at my risk cover/income protection with the help of a financial advisor and streamlined/consolidated it.

Dunno why you wouldn't want to utilise a financial advisor unless you are very knowledgable in this area (but then this thread wouldn't exist). Through her I have setup a very flexible RA, a medium risk investment where I push extra lump sums into and a debit order every month into a high risk investment.

On my own though I push R500pm into FNB's share saver - basically a combination of the RMB Top 40 and RMB MidCap. No special knowledge required and it is an ETF so it follows the ALSI. Been doing it for a year now since they started it and pushed a smallish lump sum once. Bearing in mind that the JSE is at record levels at the moment, I am up 18%. Now if you wanted to spend more time and energy on it they have a product called Share Investor with which they help you choose shares. This is a more "targeted" approach and you might see very good returns over the long term.

Disclaimer: I have no special knowledge regarding finances, just an average guy reading the forums, news and listening to a financial advisor (and a "know it all" friend whose mouth shut be shut with force some times...)

frailwings said:

Hi Lotta

I do not generally like to share my personal financial info in public, but I thought you might be interested.

In 2012 I decided that I was sick of living month to month and decided to make a change. I had finished paying off my car and decided I was not going to buy a new one. I cancelled all non essential services and removed all debt. I optimized my banking, insurance etc to the lowest accounts possible.

I cancelled all phone contracts etc. I still use an old BlackBerry. I didn't make any toy or tech purchases.

At the end of it all I had R15k to save every month. 7 months later I had saved my first 100k. It felt great.

I decided I needed to make my money work for me. I invested in AngloGold Ashanti. I made 15k in a few months and learnt how to invest on the JSE. I continued to invest my savings.

Right now my portfolio is close to 200% growth and I have over a million cash in the bank.

Click to expand...

Thanks for sharing, but maybe add some details with regards to exactly which company you used to start investing in Anglogold and then if you stuck to them or if you used someone else to trade on JSE later down the line.

Do you have a million in the bank or is that simply a figure of speech to mean you have a million invested in shares?

Maybe lay out your costs as well. It could be that R500 simply isn't enough to show a profit using your method after costs have been deducted.

Very interested in following this thread! Good luck LottaFun!

Do you have a plan for what to do with your R10K when you reach your target?

To everyone else who has been sharing their experiences and advice: thank you! I am particularly curious to find out how much people are investing relative to how much they earn per month, but I appreciate that many might consider that too personal or sensitive. However, if you don't mind sharing those values (if only approximate), it would be extremely helpful.

Brilliant thread, will be following closely!

I have recently opened a 32 day account and am currently saving between R3k and R5k a month in the account until I reach a decent enough lump sum to open up a money market account or similar

Yah this is a great thread. Will be following it closely..

Subbed. I'm going to do this as well but I'm thinking of dumping cash into the Satrix Indi. I have an FNB account so I might just go the sharesaver route. Anyways, go OP go!

dunkyd said:

Anyone giving financial advice here better be very wary because, sadly, it is now illegal unless you are registered and do a needs assesment...

Click to expand...

Well, let me clarify this a bit more so there is no confusion - any and all advice given here is taken at own risk! But seeing that it is me doing it with my money, I declare that I am taking the risk and will not hold anybody responsible at all. As I stated, if the advice is not available on a website for me to read about and analyze then it is my own risk. If somebody says buy chickens at x and sell them to y, I do it at my own risk. If somebody tells me go and read about x on website y, something that is in the public domain, and it does not pan out, it is my risk but I will name and shame that website.

I am testing the integrity of the information given by institutional websites also. After all, we are pretty far down the road of the internet age.

chrisc4290 said:

Put R500 a month into a mutual fund that has a good track record, like Alan Gray, Coronation. Their websites will give you the past history and while past performance is no guarantee of future growth, it does how you if they have been consistent.

Are you sure you can't manage more than R500? At least start off with this, and if you have some spare cash, or get a bonus, include this as well. Always re-invest dividends

Remember: Compound interest is your best friend long-term

Click to expand...

Thanks Chrisc. I will investigate this option. The one worry I have is, I keep reading about fees and more fees and performance fees and and and. The problem that I find is that you can read about how good a companies product is, but nobody tells you exactly how much you end up with.

I have read about funds that give you 20% growth, but once you start reading what users say, you see that they are paying fees through their necks and don't come close to getting 20%. So I'm a bit skeptical, but that is why I started this test.

The proof is in the pudding!