Handling finance like Buffet
By THOMAS HUKAHU
IN my first article of this year, I shared some tips on making resolutions and the importance of making changes in our lives so that we became better as individuals as well as better members of our teams in our firms or organisations.
In this week’s article, I want to share about the life of a very successful businessman in the world.
I felt the need to talk about finance and business because I am reminded that the management of finance is a skill that we must all work on, and everyone can learn from those who mastered the use of that skill.
These skills are important for us if we are involved in businesses or those who may be struggling in living from fortnight to fortnight.
Hints from the guru behind bars
The need to learn about skills in finance and business was brought to my attention by Curtis “Wall Street” Carroll, the illiterate inmate who managed to learn how to read and write in prison and is running a financial literacy programme in a cell in California.
He is now helping fellow inmates learn skills to survive when they return to society upon completing their terms in prison. In his TED talk, Carroll said: “Properly managing our lifestyle would provide transferable tools that we can use to manage money when we re-enter society, like the majority of the people who did who did not commit crimes.”
Carroll said he discovered that according to MarketWatch, over 60 percent of the American population have under $1,000 in savings.
“Sports Illustrated said that there’s over 60 per cent of NBA and NFL players go broke. Forty per cent of marital problems derive from financial issues,” he said.
Carroll said he could not believe what he was reading. He said in his talk that “people worked their whole lives, buys cars, clothes, homes and material stuff but were living (from) cheque to cheque”.
Tips from a billionaire’s life, habits
It is in Carroll’s words that I was reminded that knowledge and skills in finance and business were lacking in the lives of most people and therefore in the next couple of articles I would share some things that I have learned in past years by reading about the lives of those who were successful in mastering such.
We all should learn from those people, as from Warren Buffett.
We all know about Bill Gates and Microsoft.
I read about Gates and the good habits he displayed when he was still a boy.
In 2008, while I was living and working in a Pacific island nation, a teacher colleague told me about Buffett.
As I read about Buffett, I soon learned that many successful businessmen and women go to him to learn from him to how best to manage their businesses. Bill Gates has also been advised by Buffett, who is 25 years older than him.
And if you were to go on YouTube, you can find many videos of him presenting a talk or being interviewed by TV show hosts as well as students in the audience of a live show.
Hearing about him
I have heard about Bill Gates, the co-founder of Microsoft, since I was in my 20s. However, when I was in my late 30s, a teacher colleague of mine told me about Warren Buffett, someone who is actually helping and advising a lot of businessmen and women like him, or young people who are trying to go into business.
That was about 10 years ago.
When I started reading about Buffett, I was amazed at how he went about growing his businesses.
Who is Buffett?
Buffet is regarded as one of the most successful investors in the world.
Wikipedia states that he has a net worth of US$88.9 billion as of December 2019, making him the fourth-wealthiest person in the world.
It states that Buffett displayed an interest in business and investing at a young age. He was inspired by a book he borrowed from the public library at the age of seven, One Thousand Ways to Make $1,000.
While still a kid in primary school, he sold chewing gum. Coca-Cola bottles and weekly magazines from door to door.
I once read about him being in charge of a paper run, meaning he would deliver newspapers to people’s doors before he got ready and went to school. (Some experts say most successful business people did paper runs when they were kids.)
As a successful businessman, Buffett made his money in investing in other businesses that he bought.
He is known to for “value investing”, investing in a venture which may take a long time to start generating a profit for Buffett and his partners.
Things we can learn from Buffett
In our wish to be successful in how to handle money, we can learn from Buffett in a couple of ways.
Firstly, we must try to learn early as to how to be successful in what we do, as in waking up before other people and doing simple things like doing a newspaper run with commitment.
Secondly, people become wealthy, or save a lot of money, by not wasting funds on unnecessary things. Buffet is known to be very frugal – living very simply and saving as much to work on his business ventures.
Many people cannot save money because they waste their fortnight pay on unnecessary stuff. (You will see the truth in that as I share about the lives of other people in the next few articles.)
Thirdly, we have to be selective when using our funds, as in supporting business ideas put forward to us by our friends and relatives. We must not just give money away to just anyone who comes along and asks for it – we must stick to “value investing”, as practised by Buffett.
Fourthly, if we can, we must educate ourselves more. It is said that as Buffet was growing up and engaged in different business ventures, he planned to discontinue learning in a school setting and go full-time into business. However, his father stopped him and Buffett attended university. That has helped him in many ways.
Fifthly, if we are in charge of children, help them learn to be industrious while they are young. Do not teach them to just play all day long and eat.
Can you save some money this year?
With the tips above, it is my hope that you also make some financial goals this year and work towards realising them.
We may all not go into business, but we must be careful with money – a skill that would certainly help us and our family.
Remember, wealthy people have gone broke and good relationships have dissolved because of someone not handling money properly.
We must learn to be wiser.
Next week: Aiming for a million dollars
- Thomas Hukahu is a freelance writer.
Sawdust stove cuts costs
By PISAI GUMAR
DEMAND for firewood in urban settlements is increasing rapidly and provides an important cash earning opportunity.
The bulk of the workforce residing in settlements do not have access to electricity and depend on firewood and kerosene for cooking.
Only a few are able to buy small gas stoves and continue to buy cooking gas.
The price of firewood ranges from K2 for five pieces to K40 for a 50kg bag.
Interestingly, some of the bundled firewood is not worth the money spent on them because they are not good burning fuel.
Some types of wood, according to traditional knowledge, are superior fuel woods and are regarded as valuable for cooking and other purposes. Some of these are now used by urban settlers for their daily cooking.
Firewood is also becoming the quickest and easiest way to make money for other unemployed squatters too.
Junior Eddie Anuko, 4, from Lufa, Eastern Highlands has been observing his parents spend after K2 each day on firewood and asked dad father Eddie Anuko one day: “Papa, why should you spend K2 each day for a small bundle of firewood for mother to cook when the firewood doesn’t last long? Why can’t we use sawdust instead?”
Juniors’ question haunted his father for six months, whether Anuko was away at his workplace, eating or in bed.
Anuko completed grade 10 at Rintebe Lutheran High School, Goroka in 1996 and enrolled at the Timber Industry Training College (TITC) in Lae.
In 1997 he graduated with certificate in saw doctoring, wood machining and preservation, timber management, carpentry and how to start small timber business.
He worked with PNG Forest Products, Lae as a tally and dispatch clerk but resigned in 2016.
Anuko said he was tired of formal employment and decided to start something simple and manageable to provide for his family.
Interestingly, his skills has won him short term jobs with contractors and non-government organisations involved in building water and sanitation projects. He spent 10 months to build six clean water supplies in Biangai and Watut villages, the resource owners of Hidden Valley mine in Wau and Watut in Bulolo.
Recently, he completed another water supply project at Wames cocoa nursery site in the Wafi-Golpu project area in Lower Watut, Huon Gulf District.
At Wames, Anuko piloted the design of a sawdust ovens and his son’s question triggered his mind to do something similar for his own family.
He gathered the pieces of metal and timber and built his dream into reality at his Wames work site. He tested it out for cooking and it worked.
Soon returning home at Bundi Camp in lae, Anuko bought cement and wire mesh and set the structures in place.
In no time, Anuko had built 10 sawdust stoves of better quality than the model he piloted at Wames.
Anuko then realised some differences and benefits in using the saw dust stove as opposed to spending money on firewood, kerosene or gas.
In a week, Anuko spends K28 for firewood. For 50kg of sawdust, Anuko spends K3 and that lasts the family eight weeks for cooking.
“One round of sawdust packed into the stove can cook up to three pots,” Anuko said.
Anuko recently demonstrated with a kettle of water to make tea for this reporter. It took seven minutes to boil.
“Stoves that require kerosene, gas and electricity, though maybe safe and efficient, are costly and risky to children. My product is very affordable, efficient and saves much cost and time,” he said.
“My wife puts the pot with food inside onto the stove and she has ample time to do other household chores or relax and chew buai and tell stories instead of monitoring or fanning the fire and adding new firewood,” Anuko said.
He used a bag of cement to build eight of these stoves which stand about 30cm.
The products come in two shapes and sell for K80 in settlements and K100 at the Lae main market.
“My product is name Truave sawdust stove. Five were sold and buyers keep pestering me for more,” Anuko said.
Anuko plans to modify the stove and attach wheels to make it easy to move around.
Apart from making sawdust stoves, Anuko also builds coffins. He can be contacted on 72958388 or 70655414.