Into the Jungle

I spent two years between school and university on a work-travel visa in the UK. I did not know what work I wanted to do, and my older brothers were both at university studying medicine. They talked me out of following their path. I waited tables till I had the money for a plane ticket, then got a job as an assistant teacher at a prep school. That gave me time to plot. I initially considered teaching and architecture, but the teachers I knew complained about how little they got paid, and the architects said they did not do creative work. What drove my final choice was an acceptance that STEM skills get paid more. My maths teacher had mentioned Actuaries, but most people (including some who choose to study Actuarial Science) do not even know what they are. The kicker was there were bursaries available. Not a sexy career choice, but on the menu. The hardest part is finding out what reliably needs doing, then putting in the effort of building those skills. Look at job adverts. Look at career paths on LinkedIn. Speak to people one step ahead of you on a path open to you. Then, good luck. It is a jungle out there and we do not all have the same tools and choices.

Greener Pastures

I am on the job hunt after a gap from the corporate world. I stepped off the ladder in August 2014 with the intention of letting my engine be the breadwinner, while I focused on things that did not make money. My motivations for returning are complicated. I am also returning to South Africa. Again, a complicated decision. There are always trade-offs, and the grass is seldom greener on the other side. Or if it is, it is because of the fantastic manure you cannot see at a distance. I am not naïve about the challenges of a corporate environment. You can also sell the entrepreneurial world too hard. A lot of people who have rejected the world of money, and the world of work, to pursue their passion… struggle. We hear stories of the successes, but unfortunately not all good ideas are good business ideas. Often advice is what the giver would do in that situation, but forgets that it would not be the giver in the situation. What we know is the world is random, complicated, and ambiguous. The best you can do is put yourself in a position to be able to change your mind.

The Cotswold Way

Make Choices

I am making it up as I go along. If I sound confident in the way I write, it is because I like editing out wiggle words like “I think”, “for me”, and “in my opinion”. Everyone else is making it up as they go along too. There are no adults. There is a lot of noise, and most of what we know is path dependent. The right book, experience, or person at the right time twists the world on its head.  My interest in money stems from a dislike of the control it has over me. My choice of profession was based on a path that bumped into the expense of London, born in a world of Apartheid where your containers determine your opportunity. Actuarial Science seemed like a safe container to at least have enough to not be owned by money. Then I got into the world of investments because the competitive South African in me wanted to prove myself. Now I see myself as a Derren Brown of Active Investing. There are no Gods of investing. You can learn if you want. It is not magic. An active investor who doesn’t believe in the magic. Make conscious choices. Life will then decide your next choice. Make that.

Preparation and Noise

Choose your Mountain

20-year-old Trev also had long hair. Grown during a two-year stint in the UK on a work-travel visa, in between school and university. It was the first time I had left South Africa (I had only ever even been to Cape Town once when I was two, which felt like the closest foreign place to Durban). My bravest previous adventures had been crossing the Vaal river to visit the family who said Fish with an accent. Young Trev was also a curious spirit, but those two years exposed him to how daunting a London you cannot afford is. Sitting on a bench in Kensington Gardens, he/I took the decision to accept the world hard. Money is made in containers. One of the most defendable containers is hard. Actuarial Science is not on the covers of flashy magazines, nor does it have sexy movie leads (“About Schmidt”). It does however require serious knuckling down, which creates a deep moat. A Competitive Advantage is not what you are good at. It is why others cannot do that. The mountain of professional exams is intimidating. I am grateful to young Trev that that did not scare him. It scares me. Money is made in National Containers. Salaried Containers. Professional Containers. Inherited Containers. Figure out the barriers to entry, and how to overcome them. Hard but possible is good for you.

Happy 26th Birthday South Africa

I have always been an earnest chap with a chip on my shoulder about being taken seriously.  Easy to tease. Easy to provoke. By age 26, I had my first professional qualification and thought this gave my adulthood some spine. I moved cities from where I had studied in Cape Town to the heart of South Africa's Engine room Johannesburg. I cut my hair and swapped my eccentric tops for a proper work uniform. Peacocks get seen but often dismissed. I rented a flat on my own and started playing properly at adulthood. The change of city, and change of community, just started to poke my bubble. To look up and to look out. A stable income just starting to provide a foundation to move beyond the question of "What do you want to do?". I was doing it. What was the next question? The deeper question? Happy 26th Birthday South Africa. What is the deeper question?

 

Gaping Hole

The gaping hole in my thinking about Financial Security is that most people can’t do what I did. They don’t have the privileges I had. That was part of the plan. When I looked at the way the world worked, after I stopped sulking, I picked something with barriers to entry where my privilege gave me the appropriate tools. I joined a (closed) profession that offered skills in an industry with a product as boring as they come. We know people die and get disabled. People are expected to be productive assets, so if they can’t earn, it’s a problem. Earners need Insurance. Insurers need Actuaries. Actuarial Science is hardly sexy and there aren’t many Actuaries. I used my Maths, Stubbornness, and brute force to build an Engine big enough to pay a Basic Income at roughly the size of the Median UK income. That is my Polyfilla. There are significantly easier ways to earn the Median UK income if that is sufficient for you. The hard part was when I looked at the way the world worked, I wanted something different. So, I first accepted it. Hard. Then I built something that would stop me from cracking.

Destruction

Capital is a living organism, and Consumption is a form of killing. We need to consume to live, and so we need to ask how much of the Consumption is part of the cycle, shifting energy from one form to another, and how much is destructive. Sustainable Consumption reinvests. Meaning that not all that is produced is consumed. Reinvestment leads to Sustainable Growth. Consuming more than is produced gradually destroys what is there. Living hand-to-mouth with zero reinvestment is destructive. It is living in the present to the exclusion of all that will follow. Actuaries typically talk about a “Sustainable Rate of Return” of 3.5% for the average retiree aged 65 years old with a prudent base of Capital working for them. This means if you “see” a million dollars (ka-ching!), you should really “see” a sustainable stream of $35,000 a year if you are a custodian. See Capital as the trees, and sustainable income as the fruit. Ash doesn’t produce fruit.

Needs Must

I had a two-year gap between School and University. These “Gap Years” are more common in the UK and Australia than in South Africa. I went to the UK to work as a Gap Student at a prep-School. During this time, I was able to give more thought about what to study. My choice was deeply pragmatic. It wasn’t realistic to study the mating habits of the North Sea Clam, or anything else that was simply a liberal education. There was a clear STEM filter. I looked at surveys of pay, challenge, ability to advance, work-life balance, supply, and demand. Of these, Actuarial Science seemed to best match my skills. As a 14-year old, my Maths teacher had mentioned the profession, but that was about as much knowledge as I had. “What is an Actuary?” was an interesting starting point for many 18-year olds who made the same choice. I like the idea of a liberal education that isn’t focused on putting food on the table. But needs must. I was lucky to have the choice, and grateful to those who had given me my menu.

Professions

In South Africa, those lucky enough to go to university tend to make a pretty vocational choice. Most are thinking about 'what they want to be'. How they are going to put money on the table. The idea of a university as a place to go to widen your mind is the pudding, not the pie. You are buying a signal that will get you to the top of the CV pile, that leaves almost half rotting in the bin. Possibly in a profession that you have a vague 18-year-old's idea of. Medieval times recognised only three professions - divinity, medicine and law. The idea of providing disinterested advice, for direct/definite compensation, without business interest. Like countries, currencies, and religions... all a profession needs to be a profession is recognition. They are because people believe they are. Recognition Milestones include being 'full-time', training schools, universities, associations, professional ethics and licensing laws. A signal that helps you pre-judge... hopefully accurately.

Leave Your Ego

I enjoyed going to the conferences of the Profession I belonged to. It felt like a reunion of the people whose paths I had crossed - students, teachers, clients, and colleagues. Most of all it extracted me from defining myself excessively by the particular company I was working for at the time. The mantra of 'leave your ego at the door' can fast allow the company to become your ego. Your selflessness just shifting the selfishness to an imagined being. The company as a person. An interesting or difficult project, and office politics can fast fill both your emotional and intellectual worlds to capacity. You become the work. Conferences can allow you to 'leave your ego at the company'. They act as a reminder of being part of something bigger.

Source: Madama

ASABA and Mbeki

I went to the `launch' dinner of ASABA last night. ASABA is the Association of South African Black Actuarial Professionals. It is still a small organisation, but seems to have the backing of the big guns. Thabo Mbeki was the key note speaker. His speech will apparently be on the presidency site on Monday (see the link).

He is a fairly dry academic speaker. Eloquently worded and with bits of humour, but mostly he read. I was somehow at the press table, and chatted with a journalist from `The Citizen', and to his Media Liaison official... that's how I found out about the website.

After being introduced with a brief CV, he opened by saying what the introducer hadn't said was that he was

`about to disappear over the horizon, never to be seen again'

Clearly not all that positive about any future roll.

As for ASABA, it allows membership for all unlike some other organisations aimed at promoting black professional development. In a small profession like the Actuarial one, it is going to be a tough task to attract the cream of the `Black Academic Crop'. There are far easier ways to make money far faster than becoming an actuary. There are lots of pros for the profession but it is a bun fight out there for black talent, and it is going to take a long time and lots of effort to get the equality ASABA is after.

But you have to start somewhere, and the support seems to be there.