Surviving the emotional costs of living together

Cohabitation. A rather functional and uninspiring word for what is, essentially, an exciting time for any couple. Moving in together can certainly save you both money; after all, one household is cheaper than two. But what other implications will it have on your financial situation?

Before we go any further, it’s important to discuss the difference between living together and marriage. There is a common perception that, once a couple have lived together for a certain amount of time, they are considered common-law spouses in the eyes of the law. This is a myth. The law does not define you as married just because you have been living together. Even if it is for 10 years. As such, partners living together don’t enjoy protection should something happen to the other. This is an important distinction to acknowledge before you sit down and discuss your finances.

But whether you are married or simply living together, there’s something about discussing finances in the bedroom that seems distasteful and even unromantic. But money is one of the main reasons why couples fight. So, if you’re thinking of moving in with your partner, remember that it’s not as simple as pooling your money and splitting everything in half. We list some of the lessons real couples have shared, to help you learn from their mistakes and successes.

Have the discussion

Most financial experts agree that being able to talk about finances with your partner is a good start if you want to avoid future friction. Have the conversation about finances before you move in together. Even if the conversation is as simple as “who’s going to pay for the food?”. This will lay the groundwork for future conversations.

Andrea and Victor moved in together 10 years ago. While they were serious about each other, they didn’t know where their relationship would lead, so they made the decision to keep their finances simple and separate. Victor paid the bond, while Andrea covered the groceries and utilities. Andrea also refused to take on any joint debt as it could get very complicated should the relationship deteriorate for whatever reason.

As things got more serious between them, the couple started having different conversations. They discussed having a joint bank account, for example. “We are both independent and like to be that way with our finances too, so a joint bank account really wasn’t for us,” explains Andrea. “I want to be able to buy something for myself or my family without consulting or having to justify it. I know my finances well and know what I can afford and when.”

Today, they are married and although they now have joint debt like their house, they still keep their bank accounts separate. “I know other couples who run everything jointly and this seems to work for them,” admits Andrea. “I do think that, sometimes, a joint approach may make decisions more unified, preventing one party from typically making all the decisions regarding holidays, appliances, and other big household purchases. But for us, the independence outweighs any other potential benefits.”

Be transparent

People don’t like to talk about finances because they often think it’s inappropriate or too personal. When you’re living together, it’s important to be honest and upfront about your finances. “Be transparent about your finances, even if you don’t have joint accounts.,” says Andrea. “Be aware of what your partner earns and their expenses. Do not assume that because you got a salary increase, they did too. I think couples need to understand the financial pressures the other person may be facing at certain times. Victor and I earn similar salaries but in some months, he may have more expenses than I do, or vice versa. When this happens, we try to discuss it and find a middle ground.”

If you set up a policy of financial transparency right from the start of your relationship, you will both feel empowered and in control of your financial situation. This can have a powerful impact on long-term relationships.

When Chris and Deborah got married, they decided that Chris would manage all household expenses. Deborah abdicated all responsibility and they never talked much about finances. They had been married for 30 years when Chris passed away. Deborah quickly realised that she had no idea how to handle her own finances. She had to get a crash course in financial planning 101, while trying to get used to living alone.

Think ahead

When you move in with someone, you don’t know, for sure, whether it will be for 2 years or the rest of your life. But at various points in your joint journey, it’s important to reassess the situation, make joint decisions and set things in motion that protect you both as you go forward.

Back to Chris and Deborah. When Chris died, he didn’t leave a valid will. This is known as “intestate succession”. Dealing with the death of a spouse is hard enough, but when that spouse doesn’t leave a will, while you and any children will be entitled to inherit eventually, the process is much more complicated and drawn out. Deborah, for example, had to wait over 2 years before the estate was settled. And the legal fees were much more.

When you do write a will, ensure that someone close to you knows where it is. Too often, family members are left frantically hunting for it and, in worst case scenarios, never find it. If you want to keep its contents private, many service providers, such as Absa Trust, offer the facility of the safe keeping of original Wills. Taking into account the confidentiality and importance of a Will, it is advisable that a person utilises this service offering. This will ensure that it is safe, but private. Absa Trust can also advise on the drafting of your will so that it accurately reflects what you want to do. To find out more, click here.

But death isn’t the only way that couple’s separate. Divorce can have equally significant ramifications on joint finances. There are three marriage contracts that apply in South Africa – in community of property, out of community of property and out of community of property without accrual. The last refers to couples who draw up an antenuptial agreement. Now, many romantics feel that this is dooming their marriage to failure but, by choosing not to sign an agreement, you are choosing one by default. Divorce is an emotional time, by agreeing up front with your partner how you would like your assets protected in the future, you save yourself a lot of stress and heartache. To read more about this, visit

Don’t sweat the small stuff

When you’re sharing expenses, it’s not always easy to split the bills fairly. If you are responsible for handling expenses such as utilities or food, you may occasionally pay more than expected as the amounts may vary each month. Even if you agree to split everything in half (which is a logistical nightmare), one of you could end up writing things off just because it’s easier, this can often lead to resentment.

“I am not sure our payments are always fair,” says Andrea, “but we try to understand where the costs are sitting, and then supplement each other if need be.”

If your intention as a couple is to be fair about payments and you ensure that communication channels are always open, it will be easier to ensure the bills are evenly split over a period of time.

Keep talking and stay flexible

Things change all the time. Financial circumstances are no different. Perhaps, when you first moved in together, one partner was earning less than the other, so you agreed to split the bills 60/40. Then, as time went by, the salaries became more evenly matched. You need to be able to talk openly about these changes without getting defensive as this may create resentment. Perhaps you want to buy a big item like a new car, and the cost of it will impact on what you’re able to contribute to the household. By talking about it openly, you can find ways to make it happen without being unfair to your partner.

Last bit of advice

There are many saving opportunities that happen when you move in together. Don’t squander this opportunity to make smart decisions with any excess cash you may have. “My mom had a great bit of advice for me when we first started out,” says Andrea. “She said to try and run a household based on one salary, that way you will have the second salary as relief should anything happen to the primary salary. You can then use it to improve your lives, and not just survive the bills.

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Achieve your franchise dream -here’s everything you need to know

South Africa’s economy is under significant pressure and, for a number of reasons, there is little promise that this will change in the near future. In May this year, the International Monetary Fund (IMF) predicted only 1% growth in 2017, up 0.2% from their previous prediction of 0.8%. While it may be moving in the right direction, it falls short of being impressive by anyone’s standard.

Despite the economic challenges that businesses face, franchising is one sector that has consistently shown its resilience by performing well.

We spoke to Dumisani Bengu, head of Franchising at Absa, about the advantages of franchising and the financial options available to potential franchisees.

“As a business model, franchising is very resilient because you are buying an established brand that already has a committed following.” He explains. “South Africans are very brand conscious, they like to know it is a stable brand and that they can rely on the quality.”

And so, it seems, do banking institutions. But it isn’t the only factor considered when granting a loan.

“There a many reasons why a franchise model is appealing to a bank,” says Bengu. “Knowing that the applicant will have a certain number of customers who believe in the brand is just one aspect. Established brands also have tried-and-tested processes in the market, they have a mature and honed business model with track records and solid business projections. They also offer solid support in the form of training and guidance from experienced people who will guide new franchisees through all the pitfalls. All of this means less risk.”

Because of the resilience of established franchises, banks and financial institutions take a positive view of such companies. Existing relationships with certain franchises affords applicants preferential status when applying for finance.

What factors do banks look for when deciding to approve a loan?

“Banks are in the business of selling money,” explains Bengu. “They always have the will to lend money to fund your operations, but they need to be satisfied that their investment is secure.”

According to Bengu, the process starts with the bank assessing your level of risk, exploring questions such as:

  • Do you present a creditable prospect to the bank?
  • What are your ethical standards in terms of honouring your obligations?
  • What kind of credit record do you have?
  • If you are unwilling or unable to honour your obligations, what collateral do you have to secure the loan?

Your worthiness as an applicant, however, isn’t just about your credit rating or balance sheet. Personality is key to the success or failure of any business and, therefore, key to ascertaining whether you will receive your loan. Experience in business or as an entrepreneur helps, Bengu points out, but there are always individuals who show the signs that they have the right personality. Bengu encourages people to take a long, hard look at themselves to ascertain if they meet the criteria.

“Getting into any business is always an exciting experience, so people are always more likely to rush in without thinking everything through,” he says. “People need to assess themselves honestly and thoroughly to determine if they are happy to spend an inordinate amount of time running that business. If they aren’t passionate, their business will fail.”

Family support is also essential. Potential franchisees need to understand the pressures of the business weighed up against the family demands.

Basically, you need to know yourself inside and out, says Bengu, but also know the franchise. What is its track record? Are its ethics aligned with yours? What kind of training and support does it offer? Do your research, speak to people who have been there to get first-hand experience. One of the biggest mistakes someone can make is not fully investigating the business or yourself.

Does this mean that only well-established franchises with big names will be considered? “Absolutely not. But any potential business still needs to show that it is a business worth investing in. There should be some kind of track record (three to five  years) and proof that they have built it into a franchiseable format. It will need service models, the ability to track and refine model, a business process that is documented in an operations manual and evidence that their brand is accepted in the market.”

No one-size-fits-all finance option.

Once the bank has ascertained that you are a good risk, then there are many different finance options, depending on your particular circumstances and needs.

For buying the business, for example, they could organise a term loan, whereas the required working capital could be structured into a long-term loan or short-term instrument such as a credit card. If you are running your business from property that you own, a mortgage-based loan could be arranged. Other options, should you qualify, include enterprise development funding – where there is a reduced requirement in terms of your own contributions (as low as 20%) – or BEE funding. Each loan, as well as the interest rates, will be weighed up against your needs and capacity to pay it back.

So, now that you know what to do when deciding on a franchise, what is the one thing you should never do? “Never overestimate the value of your business,” insists Bengu. “Every cent that you borrow has to be paid back. When we ask you to contribute 50% to your business, it is not to push you away. It is to make sure you never put too heavy a burden on your cash flow. Don’t over finance and then go out of business because your obligations are too high.”

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Unlock a bursary worth R150 000 to study Big Data Analytics (Hons)

Did you know that 47% of jobs that exist today will disappear in the near future? At Absa, we recognise the big role technology is playing in transforming the jobs we do and the way we work.

That is why we have teamed up with Wits University in offering bursaries to qualifying students worth R150 000 each to study towards an Honours qualification in Big Data Analytics at Wits University in 2018.

Here’s what you need to qualify for the bursary:

  • Have a BSc or equivalent degree (NQF7) with at least 1 or 2 years of Computer Science or Software Engineering.
  • Have a BSc or equivalent degree (NQF7) with at least 1 or 2 years of Mathematics, Applied Mathematics or Statistics.
  • Be a South African citizen or permanent resident.
  • Have a passion for machine learning, data science and big data analytics.

Click here to find out more and apply.

Once your Wits application is processed and you’ve been shortlisted for the course, Absa will conduct interviews to assess and select applicants who will be offered bursaries.

Everyone wins

At Absa, we believe education is too important to put on hold.

If you don’t succeed with your bursary application, it’s not the end.

You can apply for a student loan with us to further your studies.

Click here to find out more and apply.

Own the future with the right qualifications.

Prepare for a better future. Prosper.

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Why ‘winter is coming’ for overvalued growth stocks

The immediate prospects of any investment are as uncertain as those of any of the popular television series, Game of Thrones, characters but there is no doubt that, as their valuations rise, even stable businesses can become dangerous to own.

The battle continues to rage. It maybe not be as gory as Game of Thrones but the ongoing struggle between the forces of value and growth investing is every bit as full-blooded – and certainly nobody can be confident about what will happen next.

Also, while it may not feel like it at times, the fortunes of value and growth have been seesawing for a good deal longer than the Lannisters, Starks and the rest have been on our screens.

To bring you up to speed on the latest twists and turns (on the battle of the investment styles – you will find no Game of Thrones plot-spoilers here), following what has become known as its ‘lost decade’, value enjoyed a marked shift in its favour in 2016.

This was not to last, however, and value has surrendered much of its gains versus growth over the first half of this year.

Growth’s march northwards

Growth’s continued march northwards has been led by two distinct forces with little in common aside from a growing detachment between their valuations and history.

They are the information technology sector in the US (driven by the so-called ‘FANG’ stocks of Facebook, Amazon, Netflix and Google) and the consumer staples sectors in the UK and continental Europe (driven by the so-called ‘bond proxy’ businesses).

This year, the ‘valuation gap’ between these racy US tech companies and traditionally ‘sleep-easy’ bond proxies, and everything else has grown wider.

We are increasingly concerned about the two sectors as, in equity investment and over the long run, valuations will usually triumph over quality. Bluntly put, as their valuations rise, even stable businesses can become dangerous investments.

Comfort in underperformance

We would also argue there is some comfort to be found in value’s underperformance over the first half of 2017.

Across the globe, the majority of the performance gap between value and growth can be attributed to the higher price/earnings (P/E) multiples of growth stocks. In other words, investors have been willing to pay even more for those ‘growth’ companies than in the past.

Take, for example, the following chart, which shows both the earnings-per-share (EPS) growth and the price performance of the MSCI World Growth and MSCI World Value indices during the first six months of 2017.

As you can see, while the price of growth stocks has outstripped their higher EPS growth, the market has largely ignored the EPS growth of value stocks.

Earnings-per-share growth and price performance of MSCI World Growth and MSCI World Value

Bar Graph

Source: Thomson Reuters Datastream, based on data from 31 December 2016 to 30 June 2017. Past performance is not a guide to future performance and may not be repeated.

Classic behavioural bias

An environment where P/E multiples are rapidly outstripping even the most bullish of forecasts from those who are paid to follow, dissect and analyse these two worrying sectors has echoes of the long inflation of the dotcom bubble in the late 1990s ahead of its rather more sudden bursting in 2000.

It is evidence of a classic behavioural bias where investors extrapolate current trends when forming future expectations. It goes without saying that we would rather avoid spells of investment underperformance.

There are, however, better and worse ways to underperform the market over short periods of time and, despite global profit margins nudging to all-time highs, the valuations of growth stocks are now pricing in ever-higher future earnings.

A lesson from history?

History suggests this cannot persist forever and, in the past, a dislocation in the market such as we are now seeing has been a precursor to value outperforming as expensive growth companies withdraw to lower valuations.

One line from Game of Thrones could serve as a useful warning for growth investors:

If you think this has a happy ending, you haven’t been paying attention.

The following chart highlights the extent of growth stocks’ absolute valuation on a ‘price-to-book’ basis. This is an analysis metric that compares a company’s share price with its ‘book value’ – essentially, its assets minus its liabilities – and, as you can see, it is now significantly higher than it was at the peak of the dotcom bubble in early 2000.

Price to tangible book of MSCI World Growth

Second Graph

Source: Schroders, Bloomberg. Past performance is not a guide to future performance and may not be repeated.


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The Art of Giving Back

Believe it or not, you can invest in alternative assets and grow your wealth while creating a vibrant arts sector and creating opportunities for dynamic African artists. Nando’s can show you how.

American writer, theologian and mystic Thomas Merton wrote in No Man Is An Island: “Art enables us to find ourselves and lose ourselves at the same time.” The quote continues: “The mind that responds to the intellectual and spiritual values that lie hidden in a poem, a painting, or a piece of music, discovers a spiritual vitality that lifts  it above itself, takes it out of itself, and makes  it present to itself on a level of being that it did  not know it could ever achieve.”

The power of this prose is its point that art is indeed a salve to our souls. In a world bombarded with news of famine, war, corruption and abuse, there is sweet respite to be found in the beauty of art. Furthermore, investors are increasingly becoming aware of their power to uplift and support artists and the art world by means of their support.

Spurred on by strengthening motives of social responsibility, art investment is gaining traction. Dr Julie Taylor, Founder and owner of Guns and Rain online art platform, says: “Art investing, particularly in a country like South Africa, allows for investment with a purpose, not simply for investment growth.” She believes investing in art can have a positive social and developmental impact for local artists and the arts more broadly.

South Africans are, by their nature, avid art collectors. Corporates, state-owned enterprises and family trusts have amassed millions, if not billions of rands worth of original artworks over the years, many of which can be viewed at private art museums around the country. However, until now these investments have more often than not formed part of a company’s balance sheets rather than as contributors to their triple bottom line.

Africa’s art scene

Make no mistake, it’s not all about philanthropic intentions. South Africa’s contemporary art scene can be a real money spinner. A deeper look will reveal more than wooden giraffes and gauche sunsets.

Works by local artists Irma Stern, Jacob Hendrik Pierneef and William Kentridge, to list a few, are generating stellar returns on the local and international art market. Kentridge’s Tête de femme bleue fetched €405 000 (about R6 million) in Paris in April this year, Stern’s 1943 portrait of Freda Feldman in Basuto Hat was sold  in Johannesburg for R4.1 million in 2016 and her Sunflowers sold for a staggering  £416 750 (R7.1 million) in London in May. Kentridge’s World on its Hind Legs sculpture raised £125 000 (R2.2 million). In 2013, Pierneef’s Landscape Stellenbosch fetched £713 250 (R12.3 million), Stern’s Congolese Beauty sold for £541 250 (R9.3 million), and Vladimir Tretchikoff’s Chinese Girl, fetched £98 200 (R1.7 million), all at the same auction.

In recent years other African artists have also begun fetching record prices at auction. In May 2017, Ghanaian artist El Anatsui’s wall piece Earth Developing More Roots sold for £728 750 (R12.6 million). An African art collection incorporating pieces from the Congo, Gabon, Mali and Liberia sold for a collective US$41 million (R545 million) at New York’s Sotheby’s in November 2014, which included a rare Senuo Female statue carved by an unknown Ivory Coast or Burkina Faso artist, valued at US$12 million (R160 million). Nigerian sculptor Ben Enwonwu’s The Mirror Sculptures raised £361 000 (R6.2 million), three times its expected value in London. And an Anatsui sculpture entitled New World Map fetched £541 250 (R9.3 million) in 2012.

For the good of art

While such figures show the inherent value in art, the industry is increasingly focusing on how to expose African art to international markets, making the discussion less about the money and more about developing contemporary African talent.

Former Virgin Group shareholder Robert Devereux, founder of the African Arts Trust, fell in love with Africa while on sabbatical. He is now fully committed to uplifting artists on the continent. He told London’s Financial Times: “[The trust’s] primary objective is to act as a catalyst for the emergence and growth of locally managed and sustainable contemporary art organisations… It’s really about supporting grassroots organisations.” In his personal capacity, Devereux also supports young artists in Johannesburg by offering bursaries.

Another organisation spearheading African art internationally is the 1:54 Contemporary Africa Art Fair, which is dedicated to promoting contemporary African art. Founded in 2013 by Touria El Glaoui, a former banker who was close to the art world, being the daughter of a Moroccan artist, 1:54 hosts annual exhibitions in London, New York and Marrakech. She told Village Voice, New York’s online cultural guide, about the work she does in the emerging art space: “For younger, less visible artists, its’s something that can give them visibility and that they can use as a strength.” El Glaoui adds: “We still need to accelerate getting people engaged with contemporary African artists. If we get a scenario that is aligned with the rest of the world, then our mission will be complete.” Devereux serves as an adviser to 1:54.

Locally, online platforms such as Guns and Rain are also working hard at getting African talent exposed to international markets. Taylor, who founded the initiative, explains: “Art investing – particularly in a country like South Africa – also allows for investment with purpose; not simply for growth. It can have a positive social and developmental impact for local artists and the arts more broadly.” The e-gallery promotes a number of established and emerging Southern African artists and states a commitment to fair and ethical trade. Taylor ensures her site is accessible to all the world’s major markets by having it available not only in English but also in Mandarin, French, Portuguese and Spanish.

Nando’s more than just chicken

Art platforms and organisations can only do so much, however, opening up the way for business to support the arts. One organisation that can act as a case study for South African businesses looking to give back through art is Nando’s.  Co-founder and former CEO Robbie Brozin is fond of saying:

“If you’re not in business to change people’s lives then what are you doing?”

When it comes to the Shared Growth art space, Nando’s is proud of its work within the local art arena and as a patron of the South African art scene. With more than 19 000 pieces of art in its collection, Nando’s boasts the largest single collection of South African emerging art in the world, and the largest collection of South African art outside the country. This collection is not hidden away either. It is housed in the chain’s 1000 restaurants across 24 countries.

Although Nando’s supports more than 320 artists, it did not go out looking for top young artists. Instead the company sought the expertise of development programme Yellowwoods Art.  The programme creates opportunities for artists and works at all levels, starting with emerging artists through to some of Africa’s top artistic talent. Their programmes include the Spier Arts Academy, the Creative Block and Qubeka.  And, more recently, the Nando’s Chicken Run and the Nando’s Artists Society.

The Nando’s-Yellowwoods partnership fits in with the company’s culture of making a difference. Rather than making a one-off contribution to artists, the company focuses on providing regular support and income to artists through strategic programmes, ensuring artists’ careers are being developed at the same time as the chain continues to build its extensive art collection.

The success of the programme is explained best by Brozin, who said at the launch of a new Nando’s outlet in the United Arab Emirates recently: “A lot of people talk about a social programme.  We look at art as being an integral part of making our chicken taste better.” Art is central to the Nando’s brand.

“A lot of people talk about a social programme. We look at art as being an integral part of making our chicken taste better.”

Nando’s has also joined forces with 1:54. The group hosted a stand at the 2017 1:54 exhibition showcasing four of its artists: Maurice Mbikayi, Regi Bardavid, Pat Mautloa and Lezette Chirrime. Together these artists contribute over 400 pieces of work across Nando’s stores globally.


  • Since the 2008 financial crisis, physical assets like gold and art have become attractive investment options for many wealthy individuals.
  • Art investing allows for investment with a purpose, not simply to achieve investment growth.
  • South Africa’s contemporary art scene can be a real money spinner, with works from artists like Irma Stern and William Kentridge fetching millions at auction.
  • In recent years other African artists have also begun fetching record prices at auction.
  • The industry is increasingly focusing on how to expose African art to international markets, making the discussion less about the money and more about developing contemporary African talent.
  • One organisation that can act as a case study for South African businesses looking to give back through art is Nando’s, which supports more than 320 artists and has more than 19 000 pieces of art in its collection.
  • Competitions like Absa’s L’Atelier and the SA Taxi Foundation Art Award help to raise the profile of young African artists.

Nurturing talent

Nando’s is not the only business in South Africa adding its weight to the local art scene. Absa’s L’Atelier competition, which is run in conjunction with the South African National Association for the Visual Arts, is aimed at artists between the ages of 21 and 35 and has now spread to include artists from South Africa, Botswana, Zambia, Ghana, Kenya, Uganda, Tanzania, Mozambique, Mauritius and Seychelles. The competition offers winners a range of fully paid residencies in some of the world’s top art cities.

Other initiatives offering vital support, professional development and exposure for local talent include Sasol’s New Signatures, FNB’s Joburg Art Fair and RMB’s support of Assemblage studios.

The Arts and Culture Trust, in association with Nedbank, is another opportunity for young artists to secure funding. Twelve recipients out of 688 applications receive a grant in 2017. “Grants and awards help us to take our work further. They also help a lot to raise our profile. People want to see these kinds of accolades on your CV,” says Thandi Ntuli, a Johannesburg-based jazz musician and grant recipient.

The SA Taxi Foundation also offers an art award. Its 2017 winner was painter and print maker Banele Khoza, who won R50 000.  The competition’s hallmark is the taxi decals designed by the winner and runners up. Each work is wrapped on 10 mini-bus taxis for a year.  The value of this exposure is around R600 000.

A number of local incubators have also been established to give local talent a boost.  Joule City Arts Incubator, the South African Business Women in Arts, Arts and Culture, the Kentridge Art Incubator Project and the Department of Arts and Culture Incubator Programme are just a few programmes supporting young South African artists.

Measuring the value of South African art

While support and exposure are vitally important, the sea-change in how art is received and the opportunities it offers will only be felt when investors see the sense of buying local art. Since the 2008 financial crisis, physical assets like gold and art have become attractive investment options for many wealthy individuals, who view them as safer options.

Attempts to understand art as an asset class have even resulted in dedicated art indices being created to measure the value of art as an investment. Wealth management firm, Citadel, launched South Africa’s first art index: The Citadel Art Price Index (CAPI). The index, which features 100 local artists, tracks the selling price of their artwork across a number of auction houses and auctions. The index has shown that in a world of political and economic uncertainty, art as an investment has outperformed many investment classes since the launch of the index in 2011.  In South Africa, CAPI has outperformed bonds, cash, and property, coming in second only to the JSE All Share Index. Globally CAPI has also held its ground against some of the major global indices.

In his 2016 overview, George Herman, Citadel’s Chief Investment Officer, noted: “[The] demand for real assets is bound to benefit high-quality art, albeit with some time lag.” He added: “Unfortunately only the top-end, trusted names will benefit from this search for safety.”

This insight highlights the importance of developing artists to become brands in their own right, thereby bringing their work to the attention of global investors.

Unveiling the value

Art as an investment within the Shared Growth space is harder to sell than a pure investment. And many corporates and investors remain reluctant to put money into a sector over which they have little or no knowledge.

Guns and Rain’s Taylor explains: “There is a substantial lack of knowledge about, or understanding of, contemporary fine art by the wider public. In part, this is due to the fact that art is neglected as a school subject in most countries in the region, and there is often very little government funding for the arts.”

She believes stakeholders within the industry have a responsibility to drive education: “We need further education and awareness to foster appreciation of contemporary art and its social and economic value.  There is a role for all the players in the art industry to push together for this visibility, from artists, gallerists and dealers, to critics, auctioneers and academics.”

“The competition’s hallmark is the taxi decals designed by the winner and runners up. Each work is wrapped on 10 mini-bus taxis for a year. The value of this exposure is around R600 000…” 

Taylor advises anyone who wants to gain exposure to art to work with those in the know. “Corporate or business collectors should be sure to work through reputable advisers, gallerists and dealers, and ideally invest early in young artists with promising trajectories. Bear in mind that art is a long-term investment.”

She is, however, bullish about the future.  “African art is on the ascendancy, so keep an eye on the bigger picture and learn as much as you can before making your decisions.”

Article first published in the Investment Management publication, Gradient. Gradient provides views and opinion pieces, both internal and independent, on topical issues in the financial arena and economy. For more information, please call us on +27 (0) 860 111 456, email or contact your financial adviser.


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How do we want to be remembered?

When it comes to championing the notion of Shared Growth there is a simple litmus test to follow: consider your legacy. 


  • Shared Growth means having a positive impact on society while still delivering shareholder value. And knowing that the two are not mutually exclusive.
  • Shared Growth is about more than just giving back, it is about evolving.
  • Shared Growth is about challenging ourselves to do much more. It is about pausing to ask if what we do advances society.

Barclays Africa operates in 10 African countries and has two representative offices in Namibia and Nigeria. We have 12.3 million customers. We have 1 207 branches, 10 013 ATMs and 41 241 employees. And there are countless more impressive statistics I can include, but this is not what we want to be remembered for. We want to be remembered for taking advantage of our position as a leading pan-African financial services institution to contribute to the success of Africa and her people. That’s a meaningful legacy and one which we are pursuing through our Shared Growth philosophy, which is embedded into our business strategy.

Given the depth of the challenges facing the world today, and how fast and profoundly the world is changing, there is very little – if any – space to address these needs through the corporate social investment (CSI) channels of old. Don’t get me wrong, there are many very important CSI projects and Barclays Africa has, and will continue, to do our bit in this space alongside our excellent CSI partners and initiatives. But Shared Growth is about more than just giving back, it is about placing the prosperity of the communities we serve at the centre of everything we do. It is about deploying our financial and other resources and the talents of our people. It is about challenging ourselves to do much more than just providing funding for others to serve communities.

We have taken time to carefully consider the needs of our communities and the direction in which the world is moving, and weigh this up against our capacity as a business. We have made careful choices about how we go about contributing to the development of our continent. I do not for a moment presume to claim that we have all the answers to the challenges of our continent, or even just South Africa, but we take our responsibility in this regard very seriously. Following this careful consideration, we took a decision to reorientate the way we think about the growth of our business and create a stronger alignment with our own organisational values.

One of these is the value of stewardship, the commitment to leave things better than we found them. Shared Growth is an epitome of this value and it behooves us to place the prosperity of our customers, clients and communities at the centre of everything we do.

We decided to participate meaningfully and contribute in three distinct areas:

  1. Education and skills training across our markets.
  2. Enterprise development.
  3. Financial inclusion.

Education and skills training are vital for the development of a competitive and highly skilled workforce that will help Africa to be globally competitive and to grow its economy. In each of the markets we are in we are deeply committed and have begun working with corporate partners, governments and development organisations in order to help our young people obtain opportunities for excellent education. This ranges from basic education to work readiness and post- school qualifications through scholarships.

Enterprise development assists in the sustainability of small- and medium-sized (SME) enterprises and drives the creation of employment opportunities. It is from sustainable SME growth that the young people we assist with our education and skills training commitments may find employment in order to grow their income and support their families.

Financial inclusion is a vital component of broad economic inclusion across the African continent. Without the ability to access appropriate financial services that are competitively priced and convenient it is difficult for millions across Africa to meaningfully participate in economic activity. It is for this reason that we are committed to educating consumers, using our physical infrastructure and creating technological solutions that help to overcome barriers to financial inclusion.

When we think about new products we now ask if this was a product we developed first or was it created in response to a customer need. There is a big difference. We stop to ask ourselves: “Do our customers even need or want this innovation?” Sometimes the answer is no, and then we need to consider who we are doing this for, and why.

It is not an easy journey and we are learning and growing as we go along. But we have started down this road and I hope that we are energising our own colleagues and infusing the business with a different way of thinking and acting. I for one want people to feel they are part of something bigger and more meaningful, rather than something that just has a nice label on it.

We are investing R1.4 billion over the next three years in education and skills training across our continent. Through our banking divisions and through our clients and partners we raised R1.3 billion for SME financing during the 2016 financial year alone. And we enable convenient access to financial services, value-added products and services with about half a million consumers online digitally. By the end of this year we aim to have given some 350 000 people access to various forms of accredited training and injected R237 million into education. This includes university and secondary school funding, as well as bursaries.

When you are pouring in this level of investment it is tempting to just sit back, let the money flow and say, “we’ve done our job”. But Shared Growth asks us to dig deeper and to interrogate the impact of this investment. We constantly need to be asking who should be helping us with this and who we should be partnering with, and how we should be measuring ourselves. This reflects the culture change across our organisation.

For those who brush Shared Growth – or shared value as it is called by the likes of Michael Porter and Mark Kramer – aside as a PR exercise, or pure marketing and branding, I cannot disagree more.  For instance, by using our bancassurance model we have been able to assist customers who otherwise could not access credit to do so in a way that helps them manage the risks of having credit products. We are also investing in fintech start-ups whose products are responsive to conditions and the needs of previously excluded customers across the continent.

Our value of stewardship, our desire to leave our communities better than we found them, is the lifeblood of the way we are doing business now, and in the future.   This is our ethos.

Article first published in the Investment Management publication, Gradient. Gradient provides views and opinion pieces, both internal and independent, on topical issues in the financial arena and economy. For more information, please call us on +27 (0) 860 111 456, email or contact your financial adviser.


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How To Plan For The Unplanned

Life happens. The geyser bursts. You get an unexpectedly large electricity bill. You break a tooth opening a beer bottle. (Don’t ever do that, by the way, it’s not as cool as you think.) Life happens, and when it does, chances are you are not ready for the financial fallout. Unexpected expenses can happen at any time. Some expenses may be small like a last-minute birthday gift, but others may be huge and take years to get over. Both, however, can blow the most responsible budget out of the water. But, fortunately, both can also be planned for.

Know what your planned expenses are

Have you ever reached the end of the month and looked at the amount of money you have left ‘till pay day and you wonder “where did all my money go?”. If you haven’t then you are a superhero when it comes to planning finances and, really, you don’t have to read any further. But if you are like most mere mortals, you have and you quickly put in place a survival strategy that involved eating lentils and water and selling your unwanted DVDs online for extra cash. Thing is, money only disappears when you don’t know where it is going to. First step to planning for unexpected expenses is to budget for the ones you know about. Yes, the dreaded B-word. By knowing what your regular expenses are, and keeping track of them, you prepare yourself for the ones you don’t yet know about.  So, when an unexpected expense occurs, you can look and decide where you can make changes to accommodate it.

Not sure where to start putting your budget together? Download this handy and budget-friendly (free) budget template to get you started: Budget

Be sure your “unplanned expenses” actually are unplanned

There are some extra expenses you just know you are going to have. In winter, your electricity will go up, once a year you will have to get your car license renewed, maybe September is a particularly Birthday-heavy month, you are going to have to buy birthday gifts for the dozen or so friends and family who were born then. There are going to be seasonal expenses during the course of the year. Some are expected, like those birthday gifts, others may be less so, like a tree falling down because of heavy August winds. Make a list of the expected and note how much extra you spent each month. Add those up for the year and divide it by the number of pay cheques you get (let’s assume that’s 12). That is the amount you should be paying into a separate account. When you turn unexpected expenses into expected ones, that’s practically a financial plan, my friend.

Keep a separate account for emergencies

I don’t know how you operate but if I have a little extra in my cheque account at the end of every month, I will spend it. And I know of many people who will do the same. Which is why I have two separate accounts – one for regular transactions and one for emergencies. Any extra money I have instantly goes into that account in anticipation of unexpected expenses. Even if you think you don’t have enough to justify a whole new account, open one anyway. If you make this behavior a habit, a little saved here and there adds up to a lot over time. But remember that the money is not for those days when you feel you deserve a facial or just have to have the next game – before you splurge on impulse buys, remind yourself of your financial goals. Sure, little treats are nice but so is eating. And having a roof over your head. And having electricity.

Make you emergency money work for you by putting it in a savings account. To open one today, click

Saving money on insurance doesn’t always save money

Insurance is generally considered a grudge purchase. I mean, who wants to spend money on something that you hope will never happen? Plus, medical insurance, car insurance and household insurance premiums are expensive, right? Right. Thing is, insurance is the ultimate “saving for a rainy day” policy. Premiums are expensive? Imagine a stay in hospital. Imagine the cost of repairing your car. And someone else’s if you’re at fault. You insure these things because trying to cover the cost when something goes wrong is not merely about “oh well, we’ll have to cut back on eating out this month”, they can take years to recover from. Yes, shop around and get the best deal in insurance, but do insure if you possibly can.

Don’t run the risk of having to struggle to find money when something goes wrong. Get an affordable insurance quote today.

Don’t use your credit card as an emergency fund

Credit cards have many advantages. They’re convenient, safe, offer rewards and allow you to defer payment of goods ‘till the end of the month when you get paid. But they are not an appropriate emergency fund for when you are hit with unexpected expenses. They charge interest and, because they are so easy to use, they may make you forget the extra money you had to cough up and you get false sense of your financial situation. If you do have to use it in an emergency, make sure you adjust your budget to pay it off as soon as possible.

Cultivate good money habits

Despite what it may feel like when you are sitting with too much month at the end of your money, you are not the victim of someone’s evil plan to take all your money and leave you destitute. You are accountable for the money you spend wisely and the money you squander. Create good money habits. Draw up a realistic budget and stick to it. Yes, you can budget for the occasional treat. But, make saving automatic so that it’s the first thing you do when you get your pay cheque. Avoid impulse buys. If there’s something you just have to have, adjust your budget and save up for it. Good money habits are the best way to prepare for the unexpected – they allow you to control your future, instead of always feeling that you are playing “financial catch-up”.

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Why having a will is a critical part of financial planning

The words ‘Last Will and Testament’ have a chilling kind of finality that many of us might prefer to ignore, reassuring ourselves that we are too young to consider the possibility of dying. However, the sad reality, as the well-known aphorism goes, is that “In the midst of life, we are in death” – and failing to prepare for that eventuality will mean leaving behind a family uncared for and unprotected.

Having a valid will is a critical part of financial planning because it allows you to specify exactly how you wish to distribute your assets – monetary and otherwise – to your selected beneficiaries following your death. It allows you to plan your estate according to your own wishes and needs, and ensures that the process through which your assets are distributed to the beneficiaries is simple and painless for them. By putting a legally binding will in place, you secure your loved ones’ financial future.

But while many people understand the need to have a will, it’s astounding that very few actually have one in place. Consider, for instance, the latest figures released by the Masters of the Court, which reveal that over 70% of the South African working population do not have wills. That means many workers die intestate, and risk their assets, pension and life policies payouts being inherited by the wrong people.

Yet, it doesn’t have to be like that. Working with a professional to draft a will is a fairly straight-forward process, and many institutions do it for free or at a fraction of the cost if they’re nominated as executors. A professional consultant will ensure that your will meets all legal requirements, and that your estate can be set up in a tax-efficient way to prevent assets being eroded by exorbitant estate taxes.

In addition, a professional consultant will assist you to ensure that there is adequate liquidity in the estate to meet necessary obligations during the winding-up period, as well as be able to advise you on issues surrounding nominating an executor: the person or institution responsible for winding up the estate.

It is important to know that the length of time that it takes to wind up an estate varies – simple estates with only one or two properties and a cash inheritance, for example, could take approximately six months, while complex estates or those placed under audit by the government could take years. Typically, the minimum length of time it takes to administer an estate is six months.

Another key piece of information that you should know is what happens to any life insurance policies that you may have in place. Depending on what you have specified in your policy, the proceeds will be paid directly to your named beneficiaries or into the estate account, wherein the proceeds will cover liabilities (if any) and the surplus disbursed to the estate beneficiaries.

A commonly overlooked part of the disbursement of assets to beneficiaries is if they are left to minors. In that case, their benefits will be transferred to the Guardian’s Fund administered by the Master of the High Court, which will pay out all their inheritance when they reach the age of eighteen. You can set up a testamentary trust through a will to protect your dependents’ inheritance until such time they meet certain conditions specified in a will, for example, when they are of an age you comfortable with, have graduated or achieved a certain milestone.

There are, of course, many other complex matters to consider, but the alternative – dying intestate – is infinitely worse. The obvious risk is to have your assets inherited by the wrong person because of a lack of explicit instructions. Another risk is that it might take considerably longer to wind up the estate, and that the assets finally allocated to beneficiaries might be depleted as they may need to be used to cover financial commitments in the estate during that winding up period.

Essentially, if you die intestate, your estate and assets will be administered in terms of the provisions of the Intestate Succession Act. According to this Act, succession is determined by relationship, namely spouses and descendants, and the process is a lot more complex as there are a number of scenarios that intestate succession covers.

These rules of intestate succession also apply if your will is found to be invalid. A critical point to note is that you have to live in South Africa at the time of death for these rules to apply – otherwise the laws of the country you reside in will apply.

The sheer volume of information that you need to know and consider when drawing up a will can be overwhelming. For this reason, we strongly urge you to seek the counsel of an experienced advisor to advise you based on your unique needs and state of affairs. Absa, for instance, has been helping people with their estate planning for over 100 years.

Let us help you make sure that your family and loved ones are well taken care of, even if you are no longer around to look after them yourself –

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Contract or Prepaid? We Investigate Which Is Cheaper

In recent months, the cost of cellphone data and airtime has come under the spotlight. So much so, in fact, that the hashtag #datamustfall has been trending on Twitter as social media users call for service providers to slash their data prices. With good reason, research recently undertaken by Tarriffic, comparing seven countries, rates South Africa’s data costs second highest, behind Brazil. No wonder budget conscious Saffers are moaning. But until the glorious day that the cost of staying connected does come tumbling down, we have to make the best of what we have and shop wisely.

Today, I ask the question, which gives better value for money; contract or prepaid? Before attempting to answer, I need to preface it with the declaration that this is no simple task. There’s no such thing as comparing apples with apples in the cellphone world. With that in mind, please read the small print. (For the sake of legibility, the small print is the normal size.)

* I have not compared every contract. There is not enough space in this blog to do that, and even if there were, you’d end up as confused as I was.

** There are so many factors to consider when comparing, such as special deals, whether you use more voice or data, how much data you use, whether you want your “free” phone, what add-ons you buy, etc, that I have had to make an opinion based on simplified comparisons and I advise every individual to do a little of their own research before making the decision themselves.

*** Also for sanity’s sake, I limited the choice of phone on contract to a low- to mid-range Smartphone.

Let’s do the math

In this exercise, we will be comparing MTN PayAsYouGo options to My MTNChoice+ L. My MTNChoice+ L happens to be the contract that I am on. It is available on a 6, 12, 18, 24-month contract and includes a Sony Experia L1 Smartphone. A more expensive phone would increase the cost of contract.

MY MTNChoice+ L

Cost Voice Minutes SMS Data Smartphone
R799/month 500 500 7GB Costs R R283.25 per month over 12 months (Based on a Sony Xperia L1, valued at R3399 on
Out of bundle R1.50/minute 50c/sms 99c/mb

Now let’s break it down in terms of what the writer actually uses.

On average, I use 450 voice minutes a month, 2.5GB of data and 5 SMSs (anyone heard of WhatsApp?). So, you could make the argument that I am over paying on my package. But wait, let’s have a look at those PayAsYouGo rates first.

MTN PayAsYouGo – per second billing

MTN Cost Call to all networks – 79c/min SMS – 50c/SMS Data – 99c/mb
My monthly cost based on usage 450 mins – R355.50 5 SMS – R2.50 2.5G data – R2 475

Okay, let’s stop right there, clearly data is a problem here. If you are going to just buy data willy-nilly, it’s going to get pricey. But, that’s why they invented data bundles. Let’s look at it again, this time using two MTN Fortnightly data bundles which gives you 1G of data for R89 and it last for 2 weeks each, and then a top up of a weekly bundle of 500mb for R45.

MTN Cost Call to all networks – 79c/min SMS – 50c/SMS Data bundle – R89/1GB for 2 weeks
My monthly cost based on usage 450 mins – R355.50 5 SMS – R2.50 data bundles – R223

By these calculations, my monthly cost will be R581 per month. That’s a saving of R218 a month. But that excludes the phone. So, assuming I don’t have one lying around, I will have to buy one upfront. These can range between R1 500 for an entry-level Samsung and R21 000 if you want the latest iPhone.

And the winner is….

I did warn you that this wasn’t going to be simple.

If you take the Smartphone out of the equation, and use under 3GB of data, prepaid is clearly the winner. And if you buy a cheap smartphone, or have a phone already, it’s still a winner from a cost perspective. But if you plan to use every last megabyte of that 7GBs that the contract gives you, the contract is the better deal as 7GBs of data, using the above bundle, will cost R623. Data is, without question, expensive and, if that’s what you primarily use, chances are you can find a contract that is great value for money.

So, should you ditch your contract at the first opportunity and embrace the cost savings of prepaid? You decide. Do the math. If nothing else this exercise proves that there is money to be saved when you take the time to research your options.

To learn  more on  this topic, check out some of our  interesting blog posts:

Manage Your Ego, to Reduce Your debt

Chasing the Technological Tale/Tail

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Manage Your Ego, to Reduce Your Debt

Wealth and ego are intertwined. From the first moment early civilisations started trading with each other, possessions became a symbol of what sets us apart. Back in the day, a neighbour might envy you as you pulled out your rare ivory-handled knife or marvel at your beautiful wolf skin coat that you’d bought from some faraway land. It didn’t matter that a deerskin coat would keep you as warm, it was the distinctiveness of the coat that set you apart and marked you as someone special.

Today, we still put a disproportionate amount of value on possessions. The difference is, back in the day, it was rarity and exclusivity that was valued whereas modern treasures seem to be, to a large degree, coveted for their popularity. No one sane would suggest that the latest iPhone, for example, is unique or rare. After all, in 2016, 211.88 million iPhones were sold worldwide, adding to the estimated 700 million iPhones that were already in use. Instead of setting us apart, the majority of our daily possessions today serve the purpose of making us feel that we belong. And this belonging comes at a cost.

Talk isn’t always cheap

Let’s start with the mobile phone. In our connected world, there’s no doubt that it is a necessity. You can even make a credible argument that a smartphone is a necessity. But is the difference between a Huawei P8 Lite at R2 700 and a Samsung Galaxy S8 at R13 000 really so significant? And do you really need to get a new phone when the latest model comes out? Sure, the latest gadget, a new car or an expensive watch can give you hours of pleasure as you demonstrate to your admiring friends all the incredible features that it has, but all of these are simply ways to feed the ego and prove to yourself and the world that you are doing okay. Don’t get us wrong, we love new shiny toys as much as the next guy, but they devour money like Pacman at a Pac-Dot buffet.

Steals on wheels

After our homes, a car is the most expensive item that many of us will ever buy. With entry-level models averaging R130 000 and luxury vehicles reaching way past the R1 million mark, you’d think that South Africans would be a little more conservative when considering their next vehicle purchase. But cars are the ultimate status symbol and emotion, not logic, tends to guide our decision–making. A car is about the worst investment you can make. In fact, it’s not really an investment as it’s guaranteed to decline in value. Imagine if you bought stock in a company that you knew would depreciate. Wouldn’t that be silly? But cars are bought because they reflect who we are (or want to be), not because they get us from A to B. They tell the world that we’re rich and powerful, or young and adventurous, or sporty and sassy. If there is anything that could physically manifest as our ego, it would be that four-wheeled money pit in your garage.

The harsh reality

Our egos are expensive to maintain and our credit records are paying the price. According to Debt Rescue, quoted in a 2016 article on, more than half of all consumers owe 75% or more of their income to creditors. The same source stated that Debt Rescue’s overall growth in indebted consumers who sought relief by going under debt counselling now tops 40% year-on-year.

So what’s to be done? How do you avoid the trap of letting your ego write the cheques?

Start by being honest with yourself. Are you honestly buying that new car because it’ll save you money in the long term? You may cling to arguments like “my old car’s service plan has run out” or “I want to get a good trade-in on it while it’s still young”, but isn’t the truth, really, that you simply like new, shiny things? And, can you afford that new game or new fitness watch or are you just shuffling money around so that you can pay for it now while having to sacrifice something more important in the future? According to the National Credit Regulator, almost 10 million South Africans are battling with over-indebtedness. As long as we keep letting our ego call the shots, we’re going to keep buying things we don’t need and getting ourselves further into debt.


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