Welcome to this week’s newsletter. Finally, we have reached the last quarter of the interesting year 2020! Let’s keep working on our goals for the year as we still have enough time to achieve them.

As we count down to year 2021, we will continue in our journey to getting a better grasp of personal finance and wealth management.

Last month, I came across the interview British designer Paul Smith granted the Wall Street Journal (WSJ) as part of the 50th anniversary celebrations of his fashion label.  

During the interview, he was asked about the key events that stood out for him in the past 50 years; I found (a part of) his response reproduced below very profound, and this will form the basis of today’s discussions:

“So after 50 years, continuity is probably the thing I’m most proud of. I have never been No.1, but I’ve always been relevant. We sell in 73 countries around the world; we’re still here, and we’re still an independent company.”

It pays to pace yourself – lessons from Paul Smith:

  • Consistency matters in the long run – in his own words, business continuity is key.

This can be likened to being consistent with savings and investing; whether the yields are high or low, or even if the investable funds are in the thousands or millions.

In short, it is not about the volume of funds you invest but your consistency (the magic of compounding interest) over the years.

Do not misunderstand me, investing huge sums is good but small sums invested consistently over the years end up being huge sums too.

  • Define your parameters: in the case of Paul Smith, he was (and is) still fine with not being No. 1 but with being one of the players.

One of the important things you need to clarify from the onset, is what your wealth journey will look like – portfolio size, asset types, bank account balances, charitable activities etc.

Wealth means different things to different people, for some people it is a means to an end but for some it is the end in itself.

It may sound strange but it is not everyone who wants to be a billionaire or even a multi-millionaire, some just want to have enough to send their children to good schools and live comfortably in retirement.

The key thing here is to know what you want and be at peace with your decision.

  • Do what works best for you: clearly being small (or not large) and an independently owned company was/is paramount to Mr Smith. This can be likened to knowing your risk temperament.

Knowing your temperament is useful as this will help guide your investment philosophy and asset allocation and in turn help; define the investment opportunities you will be willing to partake in and those you will gladly walk away from.

This awareness is essential as it is crucial that any investment decision taken is informed, which consequently minimises the need to panic and prevent premature sell-off during a downturn.

To know your temperament is to know your staying power!

In summary: the principles to wealth creation or growth remain unchanged; everyone’s wealth journey varies and is dependent on factors that are peculiar to each one of us.  So know yourself and pace yourself accordingly!

Interesting fact:

  • 4,000 tons: of gold are currently being held in Indian Hindu temples according to Bloomberg.

This private stash of gold is the largest collection in the world and were donated by members over the years in honour of the deities.

Due to the ongoing pandemic, some of these temples are being forced to deposit gold with Indian banks in exchange for cash to pay bills.

These truly are interesting times!

Kindly remember that there is still no cure for the corona virus and that prevention is always the better option.

Please stay safe and continue to take personal responsibility for ensuring that Nigeria does not experience a second wave of COVID 19.

Keep washing your hands, maintaining social distancing and wearing your face masks in public.  

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