Wealth creation is hard. Not just because it takes time, patience, and discipline... but because life itself seems set up to encourage us to spend rather than save.
Living hand-to-mouth is normal. When income arrives, the natural incentive is to use it to make life more comfortable. My wife likes to tease me about this when she notices (correctly) that I too genuinely like nice things. We met when I had chosen to dramatically cut back. Not because I’ve stopped enjoying the finer things. Restraint is not about becoming a monk; it’s about choosing sustainability, within chosen contraints, over short-term gratification. You can have the nice things, there are just different choices you then have to make.
When I left corporate life, this hit home in a surprising way. Walking into shopping centres made me almost panicky. Without the cushion of a salary, every purchase looked different. My wife has coeliac disease, so when she looks at a menu, she often sees “non-food” where others see choice. I began to feel the same in shops. The shelves no longer offered me freedom, but a reminder of limits. Living off capital is not the same as living off income. Salary feels renewable. Capital feels finite. The shift in mindset is profound. Spending Capital is firing it. Permanently. Spending a salary has options.
And yet, those frictions are not moral failings. They are natural. Just like in business, where barriers to entry and exit, or the need for scarce skills, create value, personal wealth requires overcoming obstacles. If anyone could copy a good idea instantly and for free, there would be no profit in it. The obstacles are what make the rewards possible.
In my view, three main frictions hold people back from building wealth: countries, currencies, and generations.
Friction One: Countries
It’s tempting to only invest where you spend. It feels safer to back your home team. There have even been long stretches where staying local has paid off.
In the 2000s, investing offshore often felt painful for South Africans. Those who stayed at home were rewarded. But the last decade has told a very different story. Global diversification has been the winner.
The problem is what statisticians call the “small sample problem.” Just because a small group has a certain outcome doesn’t mean they’ve discovered the secret formula. Take the “Blue Zones”... regions where people live unusually long lives. The differences often come down to small populations, not universal truths.
South Africa is just a tiny slice of the global market. Limiting all your money to one geography magnifies risks unnecessarily. It’s not about “South Africa versus the world.” It’s about recognising scale.
I see this often with clients. They’re proud to live, work, and build here, but they don’t want all their savings tied to the fate of one economy. Investing offshore gives them an engine on the outside, a second stream of security. It doesn’t mean they aren’t contributing at home. It means they are building resilience.
Here’s the way I picture it: people must pick one job. You train, study, commit. If you choose IT in the late 1990s, you might ride the dotcom wave, or graduate into the wreckage after the bubble burst. If you spend a decade training as a doctor, only to realise you dislike the work, it’s very difficult to change. Ministers who lose their faith have the same challenge. People commit their lives to a path, and changing direction can be devastating.
Money is different. It can take multiple jobs at once. It can switch industries without retraining. It doesn’t need a job interview. That flexibility is a gift we should use. Money should not be tied to one “career path” in a single country. It should be free to pursue opportunities across the world.
It’s not about abandoning your home team. It’s about not confusing investing with sport. Loyalty is admirable in rugby; dangerous in wealth creation.
Friction Two: Currencies
Currencies add a second layer of noise.
Every week I meet people convinced the rand is about to surge to R13 to the dollar… or collapse to R25. Both can’t be right. Yet both are said with absolute confidence. The noise is relentless.
I remember it vividly myself. Back in 1999, at Kingsmead, the Barmy Army were singing their way through the exchange rate: “six rand to the pound, seven rand to the pound…” By the time they got to ten, they had to use both hands. Today, it’s around twenty-four. They need their toes, and their child's limbs. The dollar sits stubbornly between seventeen and twenty. The swings are massive.
The temptation is to treat this like a game. Guess right, and you feel clever. Guess wrong, and it stings. But those moves are so wild, it becomes more like betting than investing.
The fundamentals are clearer: strong “hard” currencies tend to hold their value. Emerging markets need to attract capital, which means offering cheaper costs (think the Big Mac Index) and higher yields. It’s not a criticism of South Africa. It’s simply how markets work.
The problem is mistaking short-term noise for signal. Watching currencies daily is like staring at the waves instead of understanding the tide. You’ll get soaked and miss the bigger picture.
This is where the idea of price versus value matters. Currency movements put a price on something. But price isn’t the same as value. A salary isn’t worth. A headline exchange rate doesn’t tell you whether your money is truly working. Obsessing over the number misses the substance.
That’s why I always come back to my mantra: get your money a job. Don’t obsess about whether today’s rate is the best. Focus on making sure your capital is consistently at work in productive assets. Currencies will fluctuate. The discipline of putting money to work matters more.
Friction Three: Generations
The third friction is the deepest: how we think about money across time.
Too often, we live hand-to-mouth. Every decision is filtered through this month’s income and expenses. That mindset is limiting. It keeps us locked in short cycles of survival, never building the buffers that create freedom.
Sometimes, we even make hardship into a badge of honour. The “Malibu Surfer Problem” comes up in debates about universal basic income: if people are given too much support, won’t they just “check out”? Or we say, “I had it hard, so the next generation should too.”
But why? Do we really need to punish the next generation to build resilience? Surely the point is not to make life easy, but to give them enough breathing space to build skills, pursue passions, and make better choices.
Of course, capital carries its own risks. Rassie Erasmus often reminds the Springboks that no one is bigger than the team. Wealth can fool you into thinking it’s all about you. Capital needs humility and grounding.
Becoming a parent sharpened this for me. Life narrows when kids arrive. It’s no longer about your personal ambitions; you’re on the bus now, and the bus is carrying family. Wealth creation becomes less abstract, more existential. I find myself not only trying to make good decisions, but wanting to change the filter through which my children will one day make theirs.
There’s always a touch of resentment in this... not in a bitter sense, but in the deep human wish for your children to have better options than you had. More choice. Less constraint. A bigger horizon.
I’ve seen this in my own family history. My grandfather was a farmer until the weather wiped him out. Then he built a toy factory, only to lose it in a fire. Finally, he became a financial adviser. Reinvention wasn’t a luxury; it was survival.
Most people work not because it’s inspirational, but because it provides. That’s real. But capital changes the horizon. It allows future generations to choose paths not defined by immediate survival.
Sometimes you do what you want. Sometimes you do what you must. The point of wealth is to increase the proportion of the former.
Overcoming the Frictions
Unlike us, our money doesn’t need to stick to one job. It can take on multiple roles, across borders, industries, and generations. Where people are constrained, capital is free.
That freedom allows us to be choosy. Not all good ideas are good business ideas. But your money can be directed towards the ones that are.
The practice and mindset are simple, though not easy:
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Get out of debt.
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Get a job.
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Save consistently.
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Build a buffer.
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Start getting your money a job.
Over time, your capital shifts roles. At first, it supports you. Then it begins to match you. Eventually, it surpasses you, to the point where your spending becomes a rounding error, and the engine keeps compounding for the next generation.
That’s how you chip away at the three frictions: countries, currencies, generations. You can’t eliminate them. But you can turn them from barriers into opportunities.
Wealth creation will always involve frictions. The challenge is to put your money in motion. To get it jobs that you can’t do yourself. And in doing so, give yourself and those who follow you choices that survival alone can never provide.
Get your money a job.
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