Tooth Fairy

The Tooth Fairy is one of the earliest money teachers. 

My daughter had her first visit last night, after she very excitedly got her first wobbly tooth. She had a little wallet which she put the tooth in, and then put under her pillow. In the morning the transaction was done.

I love asking people how they did pocket money when they were young. Some got theirs through chores, some had to ask, some got fixed allowances that ran out, some didn't even know about money because things just arrived, and others because there was none.

Some parents plan for kids spending, retirement, or game-changing.

- Some start saving for university, cars, or first offshore trips when a child is born.

- Some open Retirement Annuities for children, that they won't access till they retire, but will have substantial disallowed contributions. A disallowed contribution is a retirement fund contribution that wasn’t deductible from taxable income in the year it was made. The kid isn't making taxable income. Those contributions can be deducted from taxable income when the money is eventually taken.

- Some open Tax-Free Savings accounts so that by the time the child is a teenager, they already have a fully tax-free engine firing on full power. Capital not intended to be harassed. Capital not there for spending. Capital with the potential to change the game if given time. Intergenerational Capital.

Other kids don't get visits from the Tooth Fairy or Father Christmas, and see Mom and/or Dad struggling to get food to the table. My friend Ben says he tells his kids, "If life was fair, you would be far worse off." A little reminder that the global average GDP is about R20,000 per month. Can you live off that? The global contrasts are hard.

The personal transitions and contrasts are hard too. When there is a gap, in either direction, between how parents live and how kids live. Or when there is a gap between how you grew up and how you end up. Or between how you and your siblings or friends live.

The Eagle Nest problem is when wealth parents constrain their kids choices to high paying jobs in order to self-fund keeping up with the parents life style.

Other kids end up supporting, often begrudgingly, parents who didn't make adequate provisions. Sometimes because they were supporting their kids, sometimes just because. That can be complicated once people start their own family, and money decisions become joint decisions with new priorities.

There isn't just one way to do money. One financial plan. One correct answer.

Money is just a story. A story deeply woven into what we care about, and how we get on with choices and trade-offs. Deeply personal. Deeply human. Deeply conversational.

Stages, not Hacks

 

The First Stage is a Scrum

Wealth creation is not about hacks. Hacks imply shortcuts, quick fixes, a secret lever that lets you skip the hard parts.

In truth, the only real shortcuts are two very blunt tools. And those blunt tools are the same ones you’d use if you wanted to take a hammer to wealth rather than build it: concentration and leverage.

Concentration means betting everything on one thing. That’s the classic “overnight success” story we all admire. The tech founder who picked the right idea. The entrepreneur who built the outlier. The investor who picked the one stock that ran a hundred-fold.

Leverage means using borrowed money to amplify outcomes. It’s paying someone else’s money a salary in exchange for growth. If your returns are higher than the salary, you win. If they’re not, you lose... and you still owe. Imagine leading an army of a million mercenaries. If they win the battle, you look like a genius. If they lose, they turn on you, because they still want to be paid.

Both concentration and leverage can create spectacular wealth. They can also destroy it. These are not refined chisels. They’re blunt instruments. Anyone can swing them, but few survive the recoil.

The more sustainable path to wealth comes in stages, not hacks. And the first stage is a scrum.

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Stage One: The Scrum

Stage one is the hardest.

At this point, it’s all on you. You are the last line of defence against noise, accidents, and life’s randomness. Death, illness, disability, family responsibilities, redundancy, pandemics, bad luck... all of these can knock you flat.

Worse, they can push you backwards into the shadow world of wealth: the debt trap. That’s when you’re working hard just to pay the salary of the money you already spent.

In the first stage, you have to be pragmatic. Ruthless, even. You look at the menu of options and pick something difficult. Something not everyone can or wants to do. If it were easy, it wouldn’t pay.

This is where many people underestimate the grind. Stage one requires doing hard, unglamorous things, often under pressure, often alone. Your job is to turn labour into surplus. That surplus is fragile. It must be protected and reinvested.

So, what helps you survive the scrum?

• Risk cover: insurance against the catastrophic blows (death, disability, illness) that would reset the game.

• An emergency fund: liquid reserves to absorb shocks without selling your future.

• Social capital: networks, mentors, colleagues. You may feel alone, but you don’t have to be. Borrow wisdom and opportunity where you can.

Stage one is about survival and surplus. Without surplus, there is no engine. And without an engine, there are no later stages.

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Stage Two: When Your Money Has a Job

Stage two begins when your money earns as much, or nearly as much, as you do.

This is the point where compounding becomes visible. Your capital is no longer just savings. It is a worker. A co-earner.

At this stage, you face a choice:

• You can let capital shrink while supporting you in retirement. The aim is to outlive your money.

• Or you can keep working while drawing on your capital’s earnings, letting the engine continue to grow.

Stage two is fragile in its own way. Market volatility can give and take. Inflation can eat away. Overspending can undo years of progress. But for many, stage two is enough. It’s financial independence, even if not absolute. It allows flexibility, optionality, and support in tough times.

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Stage Three: Stewardship

Stage three is rare.

It’s the stage where your spending is comfortably less than what your capital earns, and the capital can still grow.

Here, your framework changes completely. Time is no longer forced through the filter of “what pays.” You can spend your days on things driven by curiosity, care, or legacy. You become a steward of capital rather than just its worker or consumer.

At this stage, your decisions aren’t about survival. They’re about purpose. You are no longer asking “How do I earn?” but rather “What do I enable?”

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Stages, Not Hacks

Too often, we mistake outlier stories for the norm. The billionaire who made one big bet. The trader who caught the cycle. The founder who built the unicorn.

Yes, those stories happen. But they are concentration and leverage. The blunt tools. For every one of those, there are thousands who swung the hammer and shattered everything.

For most of us, wealth creation is slower. It’s about progression through stages. First the scrum. Then the engine. Then, if fortune allows, stewardship.

The key is knowing where you are and what matters most at that stage.

• In stage one, survive and build surplus.

• In stage two, let capital work and protect its job.

• In stage three, steward with wisdom.

There are no hacks. Just stages. And the first stage is a scrum.

Happy 31st Birthday South Africa

I was 31 in 2011. It was a watershed year for me in terms of assessing what was important. I dived into a “Project Mojo” to get myself back on track. I was living in London and started renting a lock and go studio at Wimbledon Art Studios. When I chose what to study, it had been a very pragmatic acceptance of the idea that, “Not all good ideas are good business ideas”. I loved art and maths, but it was more likely that I could monetize maths/business than art. I kept up at least one painting a year, but that was all I got round to. I had always prioritized later, but decided I need to bring some of that prioritizing into fruition. 

Every Saturday and Sunday, I would head to my studio for a couple of hours. I specifically chose to spend the year focusing on abstract expressionism. Trying to turn my mind off and focus on automatic, glutral painting, that came from somewhere else in me. Color and texture. Layers and energy. What makes you an artist? Renting a studio? Selling a painting? Believing you are one? Making a living from painting. I have always loved art. My mother was an art teacher, and I did take it as a Matric subject. Turning creativity, directly and conspicuously, into a career is something I considered… but always felt like a path with lots of resistance. These two or three hours, twice a weekend, had none of that baggage. It wasn’t for anyone else.

Wimbledon Art Studios has two open studios each year. Most of the artists clean up their studio and turn it into a gallery. There is a huge range and plenty of deals on offer. It was also very humbling for me, as you sit for hours with people poking their head in and making snap judgements of whether it is worth coming in. I did sell a few… but certainly nowhere in the range of convincing myself that this is a better career option than Asset Management. Art remained something “for me”. Not something that I would bend and twist into the mould required for paying the bills.

We all need to pay the bills. Even South Africa has to figure out a way towards economic prosperity if it wants to have these indulgent “finding yourself” years I was able to afford. Sometimes you do what you want to do. Sometimes you do what you have to.

Imagining a Post Work World

In order to consider a “post-work” world, I had to do some reading about minimalism, and explore the reasons why we get tied into expensive lifestyles. 

The default can be to commit to paying off the debt of expenses that end up controlling us. Each spending decision has unintended consequences. Minimalism doesn’t mean you don’t like the thing you don’t buy. It isn’t a case of “I don’t want it”... normally you do want it. The better question is, “in the broader context, is it worth it?”. 

At the time when I stopped working, I was single, and I had no dependents. I believed I could sustain paying for the things I valued if I held a broader context in mind. 

I get quite defensive of the younger version of me. The problem with being contrarian, and doing something that is different, is that almost everyone tells you that you are wrong before you do the thing that is different. Still, I took my shot. So, when I had to go back to work, there was an awareness of the obvious and plentiful, I-told-you-so retorts. 

The world is complicated. Plans change. I still believe it is possible to live off capital in a post-work world. There are consequences. I learnt a lot in my 6 years of attempting to step away from the world of money. So, I try and be compassionate to the younger version of Trevor that stopped working. 

I still think strategizing around how to release ourselves from the constraints of how to make money is something worth giving energy to. I still want to figure out a way to direct less of my time and energy to thinking about money. What I did realise about a year and a half in what just how fortunate my bubble of friends and colleagues were. 

There are obviously stresses, but decisions have consequences. There are tradeoffs. People make choices. Honestly reflecting on choices and constraints is a privilege.

Contrarian Choices

Wafer Thin

When I “stopped working” in 2014, I had ideas for projects I wanted to work on. What I meant by not working, was not working *for money*. 

I was just frustrated with what felt like a toxic environment. With answering the question “what do you do?” with what I do for work. With my default laid out, bar 20 odd days of leave a year. 

I still wanted to work on interesting problems, but with a different filter. Not all good ideas are good business ideas. There are a lot of things I wanted to do that I couldn’t justify. 

Another frustration was the amount of time I spent communicating what I was working on! Explaining myself. Communicating what needs to be done to people who aren’t doing it. When you get the sense that you are Sisyphus rolling a rock up a hill just to roll it up again. When you aren’t convinced of the incremental change. What the late David Graeber called “Bullsh1t Jobs”. Or fake deadlines where someone tells you to get something to them by the time your head hits the pillow... then they don’t look at it for two weeks. 

Much of my anxiety came from a sense of killing time. Time is the thing that is most valuable. That was what I wanted. Time free from price. I am also aware of path dependence. I did what I did because of the cumulative decisions that were presented to me, and that I made. Changing paths is hard when the path is relentlessly repeating. 

There can be wafer thin boundaries between what we do, and what we could be doing... but we simply don’t have the time to breathe and notice.

Financing Value

An essential part of the practice of being good with money is being good with your emotions. 

Making money involves being good with other people, through social, emotional, and cultural intelligence. Despite this, these forms of soft skills are often not the things that explicitly and conspicuously make money. 

STEM (Science, Technology, Engineering, and Mathematics) skills are typically easier to monetise because of the direct application to things you count and contain. Acknowledging that good ideas aren’t always good business ideas, isn’t an invitation to ignore social, emotional, and cultural skills. Quite the opposite, it is an invitation to invest in them heavily. 

A yogi is not someone who is completely unruffled. A yogi participates in and is part of the world. Detachment is not exclusion. Unlike in the past where the incredibly wealthy would flaunt gold and palaces, well managed wealth can connect and empower. 

A wealthy person can live a grounded life, with a background engine reinvested in problem solving. Putting capital to work, and labouring on things that are good ideas but hard to monetise. Unpaid work is often priceless, with value that needs to be funded by the priced. 

Detachment becomes that how you make money is how you finance value creation, not how you demonstrate your worth.

Growing in Muddy Waters

Time to Judge

One of my unlikely financial heroes was Bill Cunningham. He didn’t manage money. He took photographs. The friends who nicknamed me Donkey (“noisy, stubborn, ignorant”) will appreciate why I love his line, “if you don’t take the money, they can’t tell you what to do”. 

He was not rich. Quite the opposite. Yet since he lived so cheaply, that gave him the creative license to do whatever he truly wanted to do. That passion fed through to his art. 

If you are able to build an engine that earns reliably more than you consume, you can focus on things that aren’t conspicuous. You are wealthy. You can release yourself from the pressure to constantly justify yourself, and prove that what you are doing adds value. You can do things that only have value in the long term. 

Rather than disappointing people who expect far too much in too short a time frame, you can wow people who underestimate what you can do in the long term. 

Especially if the time you are thinking of is longer than people use to judge.

"If you don't take the money, they can't tell you what to do."

What Makes Money

Income and money operate at a very explicit level. Pay for what you see. Fully acknowledging what makes money and what doesn’t, and not using force to get your way, allows you to go deeper and wider. 

You can shift to embodied learning. To things we can’t explain. To the tacit knowledge that is held by people on the very front lines with zero distance from decision making. Knowledge built through immediate and repeated feedback cycles and real wrestling with real problems. Understanding that is impossible to pass up the chain. 

Research and development can take a lot of time and become a part of you. Where the payback is hidden. 

Competitive advantages I like are ones you can do in the open. In “The Art of Learning”, Josh Waitzkin talks about his jiu-jitsu teacher publishing his training videos. This surprised people, because he was freely giving away his secrets. His answer lay in his confidence that if you were concentrating on what he was doing, he would be a step ahead, because he had gone deeper. 

If you have to safely guard a secret, it’s not really a competitive advantage. It is a fragile wall. 

With an enduring advantage, you can tell people what to do, but the time, commitment, and effort will scare them off. Particularly if that mastery doesn't make money. They will head towards the six easy steps to financial freedom in six months. Not the life of hard graft that will set up the next generation.

Time - Commitment - Effort

Investing Time

As soon as you have the capacity to detach, and not be a productive asset, you are playing a completely different game. 

If YOU are “not required”. You have the ability to invest time. This may, or may not, be for something that will turn you back into a productive asset. 

Some areas require years of education before there is any sign of output. Sometimes, you even need to put in years of education just to be able to understand the signs! 

Money is a blunt cross-discipline tool to demonstrate output in areas others don’t understand. Someone pays you to do that? Someone pays you a lot to do that? Ok, it must be valuable. 

Not needing to demonstrate value in the short term allows you to go through long stretches of not knowing what you are doing. Asking embarrassing questions. Feeling annoying. Connecting dots. Mapping your ignorance. Not being respected. 

We sort people based on how quickly they pick things up. Sometimes, deep understanding requires admitting ignorance AND YET persisting. 

We have a bias to monitoring and action. For some things to do their work, they need to be left alone. For some things to do their work, they can’t also have to do the communication work of keeping others regularly informed.

"Show me the Money"

From a Point

You can rage against the machine, or you can start from a point of deep understanding of where you, and others, are. 

The way we communicate and the choices we make stem from deep soaked agreements. The vehicles we use (companies and countries) are just stories. A way we work together. Money is also just a story. A tool we use to cooperate. 

In order to interact with others, you need to learn about how we communicate. Embedding yourself in the language to let you make choices in ways that are consistent with your values. From a place of understanding. 

Once you have a point of focus, you can select where to deepen your skills and knowledge. You can have a selected portfolio of jobs for your money, and concentrate your attention on understanding those. You don’t have to have a view on everything. 

If the area you are looking at gradually increases your ability to not have a view on things you don’t want to pay attention to. 

Stilling waves of anxiety comes from decreasing the ability of waves to impact you, and simply wash over. Less unconstructive raging, and more focused, connected, and conscious engagement.

Focus

Releasing Tension

You can over-extend metaphors. When you care about something, you can see analogies in everything else. Meaning comes through connection. 

It may strike many as a misuse of the words when I talk about Financial Yoga. Money is something a lot of yogis would say they don’t care about. 

The reality is money is something that can control you, if you don’t control it. You can’t opt-out of the world of money any more than Arjuna could opt out of war in the Bhagavad Gita. 

Lots of people aim to do what they love when they grow up. My choice was more pragmatic. I studied money partly because I hated money fights and the souring effect of money anxiety on the things that are valuable beyond the weighing and counting of price. 

When you realise that money can make money, and you are in a position to build financial breathing space, you can start on a path that releases you from being forced to allocate your time and energy to money-making. You can practice focusing on the things that really matter, but don’t meet the constraints of money-making. 

That starts with releasing tension. Releasing tension starts with seeing where you are holding it.

Thrown Around

If you get the recognition and money you require from what you want to allocate your time and energy to, that is brilliant. 

The danger, and beauty, is that “this too will pass” applies to both good and bad. The world changes. Creative, and destructive, forces constantly renew and refresh the rules. Becoming attached to a fragile external source of recognition and money puts you a false step away from an imploding world. 

Yoga talks of starting the practice, and process, to still the waves. The seven Bhumikas are a map for a personal practice. Financial Yoga would be the same. 

The first step is a desire for knowledge. Then asking the right questions. Doing your due diligence on how the world works and how to still the waves. 

The third step is knowing what to do and doing it. Building a buffer that reduces the impact of the waves. Allowing you to start processing your choices consciously. 

The fourth step is where a sense of control sinks in. The waves haven’t disappeared, but you are in a position where you are no longer being thrown around.

Judo Haraigoshi

Picking an Engine

Once you buy into the idea of building an Engine, the how remains. I think of investing as getting my money a job. As a person, you need to pick an advertised role that meets (or stretches) your qualification set. You need to have a CV that describes your education, experience, and fit. You then apply along with other hopeful candidates. Normally there are too many applicants for the job, and the interviewers don’t know you personally. When investing, the dynamics change. You still need to pick a container. A vehicle in which your money can work. There will still be application forms (checking your identity, the source of funds etc.) but now the shoe is on the other foot. There are more people who want to manage your money than there is enough money for them to manage. The vehicle you choose will depend on your investment philosophy, and your relationship with money and uncertainty. You need to pick something that you can commit to (through the noise), but the decision lies with you. 

Gas Engine

 

Which Path?

We don’t choose our mother tongue or the country we are born in. Similarly, our relationship with money is path dependent. Money is not a thing. It is a communication tool. A catalyst for things that matter. That is why the conversation about wealth creation, or any creation (even things that don’t make money often need money), starts with understanding someone's relationship with money. A good financial adviser’s key job is understanding you and how you think. You can only take control over your next step on the path if you know where the starting point is. Know where you are. Know what you pay attention to. Know the container you are in. The barriers to entry to what you want to do. The barriers to exit from what you are doing. Your capacity for things not going exactly as you expect. Money is like words and numbers. It can either help you tell your story, or control your story. 

Did you choose your path?

Thriving Too

I view investing as getting my money a job. When things are complicated, we simplify them into stories (based on what we already understand) to make sense of it all. To provide a way to make decisions. I started by investing in the funds that I was studying. Which, unsurprisingly, were the funds of the companies I worked at. Which, unsurprisingly, were companies that recognised the qualifications and studies I had done. Then I got an Interactive Brokers account, and started by getting my money four jobs. Gradually over a couple of years, I got my money more jobs until I had a portfolio of 20. Unlike my current personal job hunt, my money did not get interviewed. It did not have to find vacancies in roles that fit my profile. Money does not specialise. Money does not make decisions that limit its world view. Money does not have confirmation bias that looks to explain away its inadequacies in comfortable, but false, fairy tales. Money does not define itself by the work it does. It works, and either it grows or shrinks. The secret of nature, David Attenborough says, is that “a species can only thrive when everything around it thrives too”. Making money is not a win-lose ego competition. It is win-win capital allocation.

Rain Forest

Full of  Sustainable Growth

Bread Winning

It is easy to get caught in the trap of “defending a narrative”. The story we tell ourselves about ourselves. The real world is vastly more complicated than the TV series, movies, and even books we consume. The plot is not nearly as neat. When I stepped away from the corporate world in 2014, I liked the story of saying to myself I had retired at age 34 and had a big enough engine to be a home maker rather than a bread winner. I (still) believe not all good ideas are good business ideas. There are plenty of good ideas that get ruined by being forced through the monetisation filter. Not everything worth doing can pay for itself. In 2015, I resigned from my three professional qualifications. The amount of work that went into being able to say “I *am* an actuary” was simply the tool I had used to build my engine of capital. I reinstated that qualification in 2017, only two years of no-money later, to do engine repairs. I am now thinking of going through the process of brushing off the others. Turns out life is more conversational than story telling. We get to edit our interpretation, and must constantly adapt, adjust, and accommodate.

A Little Extra

How did you do pocket money?

I got pocket money based on age, with increases each birthday. And when I was eight, I got a R8, and when I was nine, I got R9. That was how it worked till inflation kicked in, and then fortunately my parents changed the rule. That gave me an impression of progress. Of ageing, seniority, hierarchy, and annual increases. Older siblings got more (I am not bitter).

My parents would match our savings. If we saved up for something, they would contribute to whatever it was that I was aiming to buy. It is hard to teach compound interest to kids because the time horizons are so short. Compound interest takes a very long period of time. To teach that concept, you need to come up with some sort of game that can amplify the idea that money makes money. That money can have a productive job. That money can grow if you give it time.

Lots of people did not get pocket money. Just like Father Christmas does not give all children presents of equal value. Pocket Money can be a foreign concept. The idea that there would be extra. Many parents are struggling just to survive.

That is going to affect how you see the world.

The Awakening of Father Christmas

Punch, 1891

Creating a Why

Money and words are a form of communication. A way to hear stories. You can reflect on and learn through other people’s stories. Your reflection will change as you change. Part of my story is Apartheid in South Africa. I cannot let go of History. I refuse to let go of History. Because it is such an important part of understanding. We carry all this knowledge with us. Some written, some aural, some in the way we dance, the way we make our art, the way we build community. Part of being human is this beautiful, deep, painful, glorious, connection to everything. The future, the past, and other people’s now. That source of understanding gives us a powerful view of the why of why we make our decisions. I believe that life does not have meaning. We give it meaning. We create meaning. Books like Victor Frankl’s “Man’s Search for Meaning” and David Duncan’s “The River Why”. See what your values are. See what is important to you. Then create a bolder life.

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