THE VAN PLAN
FAQ.
All salary-earning South Africans, especially white-collar employees. Yes, even the ones earning 6 figures a year.
There are wonderful lessons for people that earn a decent salary but struggle to get out with their finances. If you are still young, you will learn valuable lessons towards what to look out for in life and get into the right habits early on. Even if you are a big salary earning, there are great opportunities to get the most out of your investments, especially if you are older.
There are very few guarantees in life, but I will guarantee this if you read this blog with an open mind and some of the books I suggest in this blog, I am convinced that you will be able to apply some tips and tricks to grow as a human and be closer to reaching genuine wealth. If you can apply only a few ideas that I share, you will look at money differently and be more in control of your financial habits.
My promise to you is, if you don't come out on the other side wealthier financially, you will at the very least be wealthier in the knowledge that will improve your life going forward.
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In 2016, I started the journey to become financially independent. I hated the fact that money controlled me and my family; as well as the pressures that come with it. The experiment started when I was fully indebted, I felt that I had reached the ceiling in my profession and couldn’t see a clear path to a better future. Today (September 2022), I am a consultant that mostly works when I want and invests at least 20% of my income monthly - most of the time it is more than 50%. I am not a millionaire, but I have no debt other than 25% of my home loan six years after I bought the property. I have several other investments.
If a millionaire tells people how to work with their money, the excuse is that he had it easy. If a person that does not have a millionaire status tells people how to work with their money, the people ask who the hell is he to tell us what to do. I believe I am in the best position to walk the journey with you, as my journey is still fresh enough to be candid about the details of the journey from the beginning and the signs are there that this journey will take me to the end goal: financial independence. The question is just at what age will I be able to reach it and how long will the journey be for the average middle-class South African that is willing to make the sacrifices? I believe it is doable in 20 years, but at what cost in sacrifices? This question prompted this experiment: “Let’s put this to the test and document the journey”. And this was the birth of “The Van Plan”.
At the end of 2022, I changed careers from the engineering field to the finance world to get a more in-depth understanding of the pitfalls in personal finance.
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Unfortunately, a clear definition of the middle class is quite difficult to find and will probably differ from one publication to the next. The following is a definition I found that gives the same picture as what I had in my head.
The middle class is a description given to individuals and households who typically fall between the working class and the upper class within a socio-economic hierarchy. In Western cultures, persons in the middle class tend to have a higher proportion of college degrees than those in the working class, have more income available for consumption, and may own property. Those in the middle class often are employed as professionals, managers, and civil servants.
Just as books need various stories and/or angles to drive home a specific message, my transformation did not happen overnight. It was a series of eye-opening events or moments that happened over a long period that changed my life. Sometimes you can give a child the best piece of advice, but if they can’t resonate with your message, they would not be able to use it. Sometimes you have to give the advice more than once and in various forms or situations before it hits home. In the same way, my journey has been one of trials and tribulations; ups and downs. And I expect your journey to be similar, although I hope I can make your journey a smoother one than mine. My journey is also not complete and I hope to share my journey continuously until I’ve reached my goal or come to a different conclusion.
You don’t have to be good with numbers. You just have to be systematic with data entry. You have to be good at record-keeping. The best of all is that there is free software out there to help and I will share all of this as we go along. If all else fails, click here for further help.
The content of this blog is essentially free. For as long as I enjoy sharing my journey and getting positive feedback, I will keep it accessible for all and the content free. Along the way, I will encourage you to read, or listen, to certain books that have helped me on my journey - these might be an expense. And when we get to the part of the blog where we discuss your financial independence planning, you will need some money to get started. Hopefully, I would have helped you to save enough money by this time, so that it would not be an extra cost to you, but rather a better way of making your money work for you.
A lot of people start turning their finances around with the realisation that they will not be able to retire the day they always planned they would - usually at the age of 65. This realisation often only sets in 5-10 years before the planned retirement age, between 55 and 60. This is too late and requires desperate measures. Starting early, and making small contributions early can make all the difference in the world.
The fact that you are reading this, means that you want to make a change. This is a very important first step. Well done. A good start would be for a professional to do a holistic financial needs analysis for you. Seeing a professional guarantees that you will get advice that is regulated by various Acts and Authorities. Their advice is obligated to take your circumstances into account and improve your financial situation to the best of their ability. If you want to get in contact with such a professional for a free consultation, click here.
The vehicle you should use depends on what your investment goals are. There is no ‘one-fit-for-all’ investment. The factors include your risk profile, the term of the investment and your age to name a few. But you can click here to speak to a professional for free on the correct investment for you.