Who is keeping you in check with your finances?

My husband is deep! Really deep. He is the intellectual in the family. He thinks of deep stuff like who is fighting who between ZANU PF and MDC. He worries about the future of Zimbabwe. He worries about fiscal and monetary policies of the economy. He is the aspiring Doctor of Letters in the family. I am his polar opposite, we actually joke that I am the shallow one in the family. I am all about the money, the economy that worries me is the one within my four walls, the fights that bother me are those between my kids, the future that I worry about are those of my kids. It is this future that gives me sleepless nights thinking up new strategies to tackle life. And I am sure this is a stress shared by most mothers in homes.

Some will see dirt, I see possibilities

My country is one in which the word “portfolio” means a fancy folder with documents inside, I think a lot of us don’t even know that the word has another meaning. If I say, Investment Portfolio Statement, this is something that half the population will have to look up. Yes, we are that poor. When we think of investing, we think of building a house for ourselves or mortgaging a property for family use. To be fair, these are such great feats for most of the population because everything is just hard. So let me take you to school a bit.

An investment is the process of taking your money and putting it into a project that will earn you more money in the future. An investment portfolio statement is a document drawn by your portfolio manager with you stating your risk and return objectives after considering all your constraints, the length of time to your obligations, unique circumstances (a disabled child you might want to provide for), etc. This document is the guideline to how your portfolio manager should behave with your portfolio and every year or so, the portfolio manager calls you and says, “Have your objectives changed? If they have, come in lets review.” The genius part of this, is that the portfolio manager behaves accordingly, she does not want to be found wanting in her duties.

Wall Street says that we should use it for the rich that have deep pockets and have actual investment portfolios. I believe, as Africans, we need to borrow from this concept and customise it to our needs. Why don’t we have Goal Managers that we approach, they draw up a plan for our risk and return objectives for a particular period of time, we pay this Goal Manager a certain amount of money (twice his requested invoice, a certain amount being a bet on you fulfilling your goal) , he frequently checks up on us (monthly) to see if we are on track to fulfilling our goals, if by end of year or time period , we have totally failed, the Goal Manager pockets the bet money. If we make it within the agreed upon return corridor range, he releases the money back to us. Developed economies got to where they are because they had clear goals as to what they wanted to achieve, and this clearness of vision is something that we seriously lack.

We don’t have Wall Street in Africa, African problems need a fresh new approach. Its a bit sad that everybody who studies investment, plan on leaving Zimbabwe for developed countries so that they can practice their newly acquired skills in ‘working’ economies. But we are Africa, the possibilities to what we can do are boundless and we will soon realise that the moment we get out of the boxes that we have classified ourselves into.

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