Samke Mhlongo: Don’t relinquish the financial health of your life or home to your partner

Samke Mhlongo is a seasoned private banker with over 6 years banking experience. She also serves on the board of directors at MINTEK. In addition, Samke regularly lends her personal finance expertise to television and radio stations such as eNCA, Talk Radio 702 and PowerFM. She is also a financial content contributor for DESTINYconnect. In this interview, she talks to me about her money habits.

In this economic climate, have you downsized your lifestyle at all?

Oh yes absolutely. I’ve cut down on dining out and grooming - no more manis and pedis honey! Life is so expensive.

Out of all your responsibilities (bills, groceries, etc) , what do you find to be the most expensive nowadays?

Definitely food!  My food bill is a killer, and I try to manage that by menu-planning and buying strictly according to the menu. I am currently renting property and my rental escalates annually so that hasn’t changed. I don’t have a car instalment so I am shielded from the effect of interest escalations. My other bills such as medical aid, insurance, vehicle tracking, etc, also escalate annually so no changes there. My telephone bill is dependent and it's fairly fixed. Oh and it’s great to have friends in the right places because I am attending more social events without paying for them. If only I can unlock Maps Maponyane levels and actually start getting paid to attend social events – that would be a win!

How do you save money and do you have various sources of income?

I have a day job you know, so it’s actually easier for me to save money as I have multiple sources of income. I have maintained my lifestyle at my salary level, and the ad-hoc/lumpy income from my speaking/MC engagements I use for big-ticket purchases like holiday travel for me and the kids, equipment/technology/software for my speaking gigs (re-investing), and I’ve recently opened a bank account in the UK so I’m channelling some of my funds there as I want to have a diversified currency base.

How did your childhood influence your attitude towards money?

My childhood TOTALLY defined my attitude towards money; pull up a chair for this one honey! My attitude towards money is that it’s nice-to-have but definitely not a measure or guarantee of happiness. I was fortunate as a child to experience both modest and affluent lifestyles and very early on that's how I learned this lesson. I remember as a little girl in KZN I would spend my holidays in Jo’burg with my gran and my dad.  My best memories are being at my gran’s house in Diepkloof, Soweto where I would spend my days loitering the streets with other kids, or playing bathi before heading off to buy amakota (bunny chow) for lunch. I would then spend time at my dad’s house in a golf estate and be bored out of my mind! I didn’t have any friends in the area and those children didn’t play in the streets, so it was difficult to make friends.  Although papa’s house was fancy and had a pool and a big TV with more channels than you could manage, I was unhappy. At papa’s I had a lot around me, but I didn’t have that which made me happy – friends!  As a result, I learned very early on to distinguish between that which makes me happy and that which society would have us believe makes one happy. I think that has given me a very pragmatic view of money and stuff.

How do you deal with financial setbacks when they happen?

I get real. I assess the situation, I quantify the situation (how much have I lost or how much will this cost me), I plan (where will the shortfall come from) and I execute (cut down on lifestyle, access savings, and my favourite – create a new income stream).

Have there been times where you’ve experienced money blocks or conflicting feelings about money?

Yes absolutely! When I was married I was very financially secure. I had a big house and a fancy car and annual trips and blah blah blah, but I felt guilty because I had a first cousin that did not have tertiary fees. I felt guilty that I was filling up passports when I had brothers and sisters that had never left the country. It felt like I was bragging when I was sharing my excitement about yet another trip – and that certainly wasn’t my intention. I am not saying people should feel or be made to feel guilty about being fortunate enough to have plenty, I’m just saying it didn’t feel right for me. I wanted to help more instead of consuming more. This was a time I had a bittersweet relationship with money and abundance.

How do you define financial independence?

Freedom of choice.

Why do you think women should care and take an active role in managing their money?

Because we have different risk appetites to men! It’s as simple as that. Honey, don’t relinquish the financial health of your life or home to your partner, always give your input and direction. Single ladies don’t postpone your wealth creation activities until after you are married (which is not guaranteed) or have kids (which is also not guaranteed). Start creating a legacy NOW. Set up your own family trust, establish and define your own investment philosophies. Every individual is ultimately responsible for his or her financial health and outcome. You can’t blame anyone else later in life if you are in financial distress.

Related: 7 Lessons I learned from having debt

Do you invest in shares? Why? Why not?

Yes I do. I have someone more knowledgeable than me who does so on my behalf (a qualified CFP). I like investing in shares as I am young and can therefore take on more risks because I have time on my side. I wouldn’t be comfortable investing on my own though.

If you have the choice between buying a home or investing in shares, which would you choose and why?

Buy shares because stock market index has historically appreciated faster than property. However, I would be investing the shares with the view of generating a large deposit (20%) for the purchase of a home although first prize would be to eventually buy the house cash.

In the current volatile currency and increasing interest rate climate I am also hesitant to buy a house because I don’t want to be stuck with a repayment I cannot afford. It is easier to downsize when you are renting that when you are a homeowner.

When you think of a comfortable retirement, what does that mean to you?

A house on the beach, two puppies, travel when I want (first class please, arthritis will kill me if I fly economy at that age!), and not looking at prices when I go shopping.

What’s the worst money mistake you’ve ever made, if you’ve made any? What did you learn from it?

Needing to access cash in an emergency which resulted in me having to sell shares at a loss. Warren Buffet says you shouldn’t invest in the stock market unless you can watch your investment lose half its value without panicking. Share investing is a long-term, cyclical game. If you are caught out during a downturn, you will pay dearly.

What tools or resources do you rely on to keep your own personal finances in order?

My banking experience; nothing more nothing less. For those that don’t have banking experience follow my page on Facebook where I give money tips that I have learned over the years.

What do you splurge on?

Travel. I love to travel. Keep your big house, keep your fancy car, keep your champagne - just put me on a plane!

What was the last item you regretted purchasing?

Two weeks ago I paid R180 for eyelashes while having my makeup done at a cosmetic counter. ONE HUNDRED AND EIGHTY SOUTH AFRICAN RANDS! What was I smoking?!

What are your rules for lending money to friends or family?

It only works where there is a defined repayment date, and interest is built in. If there is a default don’t lend additional money until the amount owing has been settled. My aunt and uncle help me out all the time because they know I pay them no later than the very day I promised I would. It makes it easier for them as well because they know I am trustworthy with repaying money. We all get into a spot sometimes and friends and family are the best place to start for those quick emergency loans because there is no paperwork, initiation fee, blacklisting, etc. Just don’t take advantage – pay back the money you have borrowed!

Do you and your women friends talk about money?

Absolutely! It’s difficult not to with me around.

When it comes to giving, how do you decide where to allocate your money?

I give what I want, when I want. My philosophy is that giving is completely discretionary which is why I hold such a contentious viewpoint on black tax.

I prefer giving time and services as opposed to money to be honest. I give my support to the Othandweni Children’s Home annual talent and beauty contest. I rally my friends and we put on a spectacular show every year, complete with sponsored venue, DJ, music, hair, makeup, clothes and prizes. It doesn’t cost much more than the phone calls I make and fuel I use travelling up and down. That’s my preferred style of giving.

What's the best financial advice you've ever received?

It wasn’t advice but rather a question: "If you lost your job tomorrow, how long would you survive before going broke?"

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Samke is represented exclusively by Conference Speakers. For bookings, call 082 718 8447.