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    16Apr, 2024
    The Keys to Successful Investing
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    In our previous blog, we discussed some of the myths that limit us from getting started and succeeding in investing. We have all been victims of some of these myths at one point or another. Now, in today’s article, we will look at what it takes to be successful in investing. We have done some research and compared notes with others who have addressed this subject of investment success and have come up with a list of 5 keys necessary for your financial success.

    1. Writing Down Your Goals, Having a Plan

    Did you know that about one in every 100 people has written down their financial goals and has a plan to meet these goals?All of us have what we desire to achieve financially. But unless you put these desires on paper and come up with a plan on how to achieve them, then they remain fantasies and dreams. 

    In His book “7 Habits of Highly Effective People” Stephen Covey says that the 2nd habit of highly effective people is that they begin with the end in mind. Articulating or writing down what you want to achieve through investing enables you to remain focused and motivated towards getting to your goal. So, take some time out of your routine and write down your financial goals, come up with a plan for fulfilling the goals and periodically review the plan. 

    2. Desire it, Believe it, See it

    It is not enough to just write your goals. You must believe in them. In his book “Think and Grow Rich”, Napoleon Hill states that your financial success starts with the mind. Unless you visualize success and believe that you have what it takes, you will keep giving up or getting derailed along the way. Some of the things that can help you keep the faith include reading books or watching videos that motivate you towards your goals, constantly reviewing your financial goals and plan, looking for and interacting with individuals who are more successful than you financially and who encourage you to your financial goals and participating in talks, courses and forums that keep encouraging you towards your goal.

    • Our life is what our thoughts make it. – James Allen
    • Whether you think you can or you think you can’t, you’re right. – Henry Ford


    3. Understanding the Money World

    Robert Kiyosaki, a renowned investment teacher puts it this way – “The difference between those who succeed financially and those who fail is knowledge. He says that the reason many of us fail in investing is because financial literacy is not taught in school and many of us are ignorant about the financial world thus leaving us as victims.C:\Program Files\Microsoft Office\MEDIA\CAGCAT10\j0298653.wmf

    In his book “The Art of War”, Sun Tzu, says that “if you know the enemy and know yourself, you need not fear the result of a hundred battles”. The money world is like war and if you do not understand what you are up against, you will end up being a victim and slaving for those who understand the money war and work it to their advantage. So, for you to be successful, you must understand how the money world works, who are the players and how you can position yourself for success.

    4. Get Started and Be Consistent 

    Once we define our goals and gain an understanding of the financial world, we then need to go ahead and get started in our investment journey. A major key to succeeding financially is being consistent. Investing is more of a lifetime marathon rather than a sprint. Many people wait for a deal or some financial breakthrough as their key to success. However, one-offs have very little to do with your long-term financial success.

    In his book “The Richest Man in Babylon”, George Clason states that money laws are like the law of gravity and they work all the time. His 2nd money law states, “Start thy purse to fattening”. He explains that for you to succeed financially, you must pay yourself first by saving part of your income and thus fatten your purse. In his 3rd law of money, “Make thy gold multiply”, he explains that you need to know how to multiply your wealth by wisely investing it.

    5. Overcoming Failure

    In his book “Think and Grow Rich” the writer says that success is always past failure. In other words, anyone who truly succeeds must have already failed before the success. It is said that on average, you will face a financial challenge that will significantly impact your wealth once every 12 years. 

    Therefore, it is wise to expect failure and protect yourself against the impact of a financial crisis. Insurance and having an emergency account are important to protect yourself. You also need to keep getting up once you fail and always know that success is on the other side of failure. 

    10Apr, 2024
    5 Investment Products for Your Consideration
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    One of the key factors to successful investing is understanding investment products. Investment products are opportunities available to enable you to accumulate and multiply your funds. Below are some of these products that you can consider for your investment.

    1. Stocks or Shares

    Almost every wealthy and successful investor all over the world has at one point or another invested a significant amount of their wealth in shares or stocks. Shares enable you to own a small piece of a successful listed company and thereby share in the company’s good performance and profits. 

    However, understanding how shares work is paramount to successfully investing in shares. You need to understand the stock market trends and invest for the mid to long-term. Shares are easy to trade and do not require much capital. They can significantly grow your funds. However, they also carry a risk element as your investment can get eroded by lowering share prices.

    1. Treasury Bills and Bonds

    Treasury bills and bonds are investment products that are transacted by the government. When the government wants to borrow funds from the public, they will use these products. Treasury bills and bonds have a low but sure return on your investment. They are ideal when you want to preserve your funds as you cannot lose the funds that you have invested.

    1. Commercial Papers and Corporate Bonds

    When corporations want to borrow funds directly from the public, they use commercial papers and corporate bonds. These work in a similar way to treasury bills and bonds but are issued by a company as opposed to the government. They will usually provide interest rates higher than the treasury bills and bonds but carry a higher risk as the issuing company may be unable to meet its obligations.

    1. Mutual Funds/ Unit Trusts

    Fund managers have products that enable the pooling of funds and investing in a collective fund. They work more like “chamas”. The fund managers pool funds and invest in shares, bank deposits, real estate and other products. The profit from the pooled investment is shared with the members of the mutual fund. Mutual funds are easy to invest as the entry investment is low (about 1000.00). You can also deposit and withdraw funds in a mutual fund at any time.

    1. Wealth Management/Cash Management

    Wealth management, also referred to as cash management, is an investment product offered by fund managers. The fund managers provide a higher, guaranteed interest rate than mutual funds. However, they will have a higher minimum investment amount usually of Ksh 1 Million and the funds will be locked for investment periods of 3 months, 6 months or a year..

    1. Bank Deposits

    Banks will normally provide very low-interest rates on funds deposited with them. However, if you have a large amount of money, you can negotiate for high-interest rates, especially from Tier 2 banks.

    7. Real Estate

    Real estate is one of the most popular and highly effective investment products. With the right strategy, you can make substantive returns on your investment in real estate. There are various real estate strategies including building rentals, building houses for sale, purchase of land for sub-dividing and reselling, purchase of land for speculation and purchase of land for other commercial activities such as farming. However, to profit from real estate, you will need to do some thorough checks and also understand the dynamics of the industry. We will have a more detailed review of real estate investing in one of our subsequent blogs. 

    1. Private Equity

    Private equity entails owning a percentage of a private business that you are not directly involved in running. It is another effective way of investing and growing your funds. Private equity is not a very developed industry in Kenya. However, there are good opportunities available for partnering with budding businesses to profit when the business matures.

    Rubiani Wealth Management provides advice on investing in any of the above products. We have also partnered with fund managers, stockbrokers, banks and other financial institutions to facilitate your investment in these opportunities. If you need any further information about any of the above products, please get back to us by contacting us at invest@rubianiwealth.com


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    4Apr, 2024
    7 Ideas to Build Your Passive Income
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    Passive income is the income you make with little of your effort or time put in. In other words, it is money working for you. Developing your stream of passive income is important for several reasons. Firstly, passive income will increase your cash flow and thereby increase your purchasing power. Passive income will also have the potential to grow exponentially as it is not limited by your time or effort. Understanding passive income is therefore key to growing real wealth. Finally, it’s important to develop passive income as you age. You may not have the energy to work as agile as you did before and at that time, you want to have your money working for you instead.

    There are many opportunities for you to develop your passive income. In this blog, we will look at 7 of these ways.

    1. Real Estate – Real estate includes land and buildings. Rental property is ideal for passive income. If you are looking to develop your rental property, identify a location with a high renters population and with reasonable land prices to maximize your returns. You can also purchase houses or office space to rent out. Centum, Tsavo Properties www.tsavo.ke and The Epic Properties Ltd develop small unit houses (bed-sitters and one-bedroom) targeting investors seeking to make rental income.

    Advantage – Rental income from real estate protects you against inflation by hiking rent as standards of living rise

    Disadvantage – Developing rental property is usually expensive. Furthermore, if you are developing the property yourself, land ownership and developing the property can be hectic especially if you are not experienced.

    2. Treasury Bonds – These are government instruments that allow you to invest long-term with a reasonable return of investment of between 9 – 14% per year. You receive interest every 6 months for the term of the treasury bond and at the end of the term, you receive back your investment.

    Advantage – High, long term and hustle-free passive returns. Also, long Treasury Bonds of over 20 years (Infrastructure bonds), are tax-free. Treasury bonds are also easy to liquidate (through the NSE) if you wish to sell before the end of the term. They are also affordable at a minimum of Ksh 50,000.00

    Disadvantage – The income from Treasury Bonds is not inflation-sheltered and your income remains constant throughout the term of the bond

    3. Wealth Management / Cash Management Product - This is an investment opportunity provided by fund managers whereby investors lock funds for periods of 3 months, 6 months or 1 year and receive interest from their investment in agreed-upon periods. The minimum investment is Ksh 1,000,000.00

    Advantage – It gives you more control of your funds as topping up and withdrawing funds is easy. You can also arrange with your fund manager to receive your interest every month. 

    Disadvantage – The interest rate keeps fluctuating with market performance so mid to long-term earnings prediction is impossible. 

    4. Income Earner and Annuities - Insurance companies also provide products for passive income. You give a lump-sum amount to the insurance company and in return receive a predetermined amount of income every month for a specified amount of time. 

    Advantage – Monthly income ideal for retired senior citizens

    Disadvantage – The returns on your investment are not competitive

    5. Private Equity – Private equity is owning a part of a private company that you are not involved in the day-to-day running. You therefore earn dividends based on the performance of the business. You can directly negotiate ownership in a business in exchange of capital funds or go through private equity companies that give you access to businesses needing funding partnerships. If you are a business owner, you can create systems and processes and hire people so that your business can operate without your active involvement. This way, you can convert your business into a source of passive income.  

    Advantage – Opportunity for exponentially growing wealth. 

    Disadvantage – Long-term passive income is not guaranteed as you are exposed to business risks including losses and closure

    6. Royalties and Residue Income Opportunities – Royalties are the money paid for the use of intellectual property.  It includes payment for a franchise and payment for the use of copyrighted content. Software developers and artists such as musicians can continue earning from their intellectual content many years after production and thus passive income.

    Advantage – Depending on the value and uniqueness of the intellectual property, it can be quite profitable.

    Disadvantage – Income will usually dwindle over time and therefore not a reliable long-term source of passive income

    7. Residue Income – Residue income is income that you continue earning long after you have made a sale. Opportunities such as the sale of insurance and investment products, internet affiliates and agency commissions provide residue income -- as long as the client continues to renew the service.

    Advantage – You do not need funds to generate this type of passive income flow but rather your sales skills and networks.

    Disadvantage – Long-term passive income is dependent on renewals thus requiring some level of customer service input to maintain income. 

    We hope that this list will help you as you think through developing your streams of passive income. Please feel free to revert with comments or enquiries by writing to us at invest@rubianiwealth.com.

    2Apr, 2024
    How to Invest in the NYSE and NASDAQ from Kenya
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    Investing in the New York Stock Exchange (NYSE) and the NASDAQ exchange is a great way to diversify your portfolio and gain exposure to some of the world's largest and most successful companies. However, for us living in Kenya, the process can seem daunting. Fortunately, with these few simple steps, investing in the NYSE and NASDAQ from anywhere in the world is possible.

    First, you'll need to open a brokerage account with a firm that allows international investors to open accounts. Some popular options include Interactive Brokers, TD Ameritrade, and eTrade. Be sure to check that the firm is reputable and regulated and that it offers access to the markets you're interested in investing in.

    Once you've opened your account, you need to transfer funds into it. This can typically be done via wire transfer or credit card. You should also ensure that your account is properly linked to your local bank account so that you can easily withdraw funds if you need to.

    Once your account is funded and set up, you can start investing in the NYSE and NASDAQ. Like any other stock, you can purchase shares of publicly traded companies listed on these exchanges through your brokerage account.

    One important thing to consider is the currency conversion as the shares are bought and sold in US dollars. This will affect the value of the shares depending on the exchange rate of the currency you are using. Given the current unstable state of the Kenyan shilling, this can be an advantage. Also, you should be aware of the taxes and regulations in your country as they may affect your returns.

    It's also worth noting that some companies listed on these exchanges are also traded on other international stock exchanges, so you may be able to purchase shares through those exchanges as well. It's always best to research and consult a financial advisor before investing.

    Investing in the NYSE and Nasdaq from outside the US is doable, but it requires some preparation and research. By following the steps outlined above and working with a reputable brokerage firm, you can access some of the world's most powerful markets and potentially benefit from the growth of some of the world's top companies.

    Also, It’s important to keep in mind that investing in the stock market comes with a level of risk and should be done after research and consulting with a financial advisor.

    Interested in investing in foreign stock markets from Kenya? Kindly contact us at invest@rubianiwealth.com