By Martin Sweet
I am Martin Sweet, Founder and Managing Director of Primestars. A very warm welcome to all you wonderful people who have made Rethink Rands possible.
For the incredible women out there who lead with kindness, stand with integrity and inspire with their actions, we wish you a happy women’s month, because one day is simply not enough to honour your greatness.
The Rethink Rands Programme is our commitment to drive empowerment through education by embedding financial literacy in our schools, and helping the youth establish a financial and entrepreneurial mindset that contributes to success, rather than struggle.
As Benjamin Franklin said. ‘An investment in knowledge pays the best interest.’
The knowledge we want our children to invest in, is all aspects of money management: earning, budgeting, saving, investing, assets and liabilities, income and expenditure, the impact of inflation on our money and understanding financial products like loans and credit cards.
The interest that will then be paid out to them for their investment will be freedom. Freedom to make choices, to take control of their lives, to shape their own futures, to grow up to be empowered adults, who can turn their financial dreams into reality and even become entrepreneurs. It is the small actions we take today that lead to monumental impact tomorrow.
It takes a village to raise a child, and we are that village. Together, let’s raise them to understand the magic of things like compound interest, diversification, credit scores and investing. By preparing them for life’s unexpected challenges or inspiring them to become entrepreneurs, we are opening a world of financial possibilities and offering a new sense of hope and belonging.
Finance is an emotional subject. Many of our money troubles are caused by behavioural traps like a lack of self-control, impulse spending and peer pressure that keep us locked in a cycle. Maybe some of us in this room, if not all of us, can relate to these traps to some degree – traps like emotion, ego, conformity and inertia. So how can we safeguard the next generation? Let us arm them with clear thinking and behavioural insights to overcome these traps.
This is the thinking that sets Rethink Rands apart. Instead of following a traditional financial framework, we focus on psychology, behavioural economics, and a system of understanding behavioural change that anyone can follow to take control of their finances.
There is a principle that managing money is more about mind than math. Isn’t that profound? Managing money is more about mind than math. That is why Rethink Rands explores how human judgement, and our choices are affected by fear, greed, herding, social pressure, inertia, and mental shortcuts, often leading to irrational decisions.
Rethink Rands will encourage learners to change their earning, spending, and saving habits, based on managing their emotions, and behaviours. If we understand the emotional, psychological reasons behind how we behave with money, only then can we learn to act differently. We can break bad habits, overcome our thinking biases and stop self-sabotage such as procrastination.
For instance, one way to boost self-control and change bad habits is to sign commitment pledges. These pledges are set up so that a bad decision is not even an option.
If you are irresponsible with credit cards, a good commitment pledge would be to only use prepaid debit cards. Or, if you are spending money that you should be saving, reduce the temptation by setting up an automatic deposit that takes a certain amount directly from each paycheck.
The ideal time for an intervention like Rethink Rands is early on in the career development process in high schools. If we can instill good and healthy financial habits then, it will serve them and our country as they grow.
South African’s spend 75% of their take-home pay servicing debt. According to the latest 10X Investments Retirement Reality Report, only 6% of South Africans can afford to retire comfortably. Among those surveyed, 70% of people could not afford to save any money at the end of the month. Of course, there are multiple reasons for this, including a knock-on effect from the pandemic as well as global economic factors.
But at an individual level, Rethink Rands has the opportunity to help change this picture with your help. To teach our children that they cannot under-save for retirement, that they cannot lose self-control and procrastinate about making decisions for their financial future.
To start emotionally connecting yourself to the future is one of the best ways to increase self-control and resist the temptation to spend. Building wealth comes down to sacrificing pleasure now, so someone else – your future self – will be happier.
Our financial education programme will include an edutainment feature film, a practical illustrated guide, cutting edge e-learning, social media engagement and sessions with money mentors. Through the power of film and storytelling, high school learners are taken on a powerful experiential journey where they will come to understand what influences how they spend and save, and what they can do to make smart choices.
They will learn their money EQ is just as important as their money IQ. That even with very little money, they can begin to build a solid financial future. Rethink Rands will equip them with the tools and knowledge to know that small changes can make a big difference over time. Simply getting started is the first and most important step towards doing something.
Misinformation is at an all-time high and financial literacy is at an all-time low.
Our youth are being thrown into the deep end of financial decision-making with little more than a life jacket of common sense. But by taking actual, actionable steps to remedy their thinking errors, the youth can turn their lives around and demystify the world of finance. We want our children to be empowered, not intimidated.
Imagine a generation that understands how to manage money effectively. A generation that will be more likely to be entrepreneurial, innovative, and capable of making sound financial choices.
Rethink Rands is an opportunity for us all to build a more inclusive, equitable and prosperous society, a world where passive income, investments, and generational wealth are the norm.
The idea is not farfetched if we are:
- Allied in the recognition that a lack of financial literacy makes it extraordinarily difficult, if not impossible, for the youth to make sense of their financial lives.
- Bonded in the understanding that financial literacy is the cornerstone of any effort to disrupt poverty, alleviate financial struggle, and help everyone seeking to realise financial security and reach their potential.
- United in our conviction that the time is now to make financial literacy and entrepreneurship a fundamental part of South African life, and that we are uniquely positioned with an opportunity and responsibility to help make this happen, in a manner that is engaging, practical and applicable to their everyday lives.
We call on the public and private sector to play their part in creating a financially literate society by embedding the Rethink Rands Programme in our schools. This movement will reach thousands of young people by meeting them wherever they are on their financial journey, ensuring they have access to, and an understanding of the knowledge, tools, and resources they need to make informed financial decisions. We have to harness their awareness. Just like us, they cannot do better until they know better.
Today we activate the MASSA movement – Make South Africa Save Again. Rethink Rands encourages youth to seize every opportunity and get into the habit of saving.
Saving
- To help cover financial emergencies.
- To be a cushion against sudden income loss.
- To help finance big ticket items.
- To help prepare for retirement.
- To fund education and give them a head start in life.
Let us reinvent money habits by raising a generation that turns their future hindsight into their current foresight so that they structure their lives with the end in mind. In so doing, they will save to save South Africa.
