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Old mutual kenya. Financial management and planning

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To be our Customers’ most trusted savings and wealth management partner in East Africa …

To be our Customers’ most trusted savings and wealth management partner in East Africa


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  • 1. OLD MUTUAL KENYA “To be our Customers’ most trusted savings and wealth management partner in East Africa” Page 1
  • 2. Retail Mass Market
  • 3. COURSE OBJECTIVES 1. Personal financial management •What is Financial education •Why is Financial education important •Financial self awareness goals •Pillars of personal finance •Building a personal financial plan •Budgeting, saving and investments guidelines •Retirement and estate planning •Personal balance sheet •Personal record keeping 2. Principles of Financial management •Illustration with the BIG 5 animals 3. Financial planning solutions •Long term savings – retirement & investments •Dependent education •Life cover 3
  • 4. About Old Mutual • • • • Old Mutual was founded in 1845 and we have since expanded from our origins in South Africa through organic growth and strategic acquisitions. Old mutual is among the largest and most established and trusted financial service providers in the world with over 40 years experience in managing low risk high return products. We operate through market leading international brands including Old Mutual, Skandia, Nedbank and Mutual & Federal. OMK offers products in four areas: Long-term savings, asset management, banking, short-term savings and stockbrokerage. • We are in over 34 countries { Africa, Europe, America and Asia } and have over 54,000 employees. We are based in London. • Old Mutual operations started in Kenya in the late 1920’s and were directed from Salisbury (Harare) until 1930, when a branch was established in Nairobi where it is now amongst the top ten insurance companies. • Old Mutual restarted operations again in 1995. Page 4
  • 5. Group Structure Page 5
  • 6. OLD MUTUAL GLOBAL PRESENCE Presence in over 34 different countries Over 165 Years of Investment Wisdom!
  • 7. WHAT IS FINANCIAL EDUCATION This the ability to understand personal finances and allow an individual to make informed and effective decisions in securing their future. •People think choosing the right investment savings plan is more stressful than a visit to the dentist!!!!!!!!! Page 7
  • 8. WHY IS FINANCIAL EDUCATION IMPORTANT • Achieve personal Goals – – – – – Buy a home Fund the children’s education Ensure there’s an income when we retire Peace of mind to enable us be productive at work places Plan for holidays • Have cash flow – To balance our budget – Financial freedom- get out of the rat race • Cater for contingencies – To ensure you have a nest egg when out of a job/emergency – Take care of our financial obligations after death/disability – Plan for Health care needs Page 8
  • 9. MONEY CYCLE Three key pillars that are critical to planning Accumulation Growth & Conservation Distribution Page 9
  • 10. COMMUNITY FINANCIAL EDUCATION HEALTH CHECK From research, it shows that:  91% of East Africans spend more than they earn  70% don’t have income on retirement  71% of adults know nothing about investments in equities, bonds, stock market.  Newly employed people don’t have the ability to choose and manage credit card or save for retirement.  67% of Kenyans claims to know the concept of compound interest while a partly 18% have an idea.  Highly educated consumers with high income levels can be just as ignorant about financial issues just as less educated, lower income consumers. Page 10
  • 11. INDIVIDUAL FINANCIAL HEALTH CHECK • Do you have financial goals? • Do your expenses exceed your income? • Do your expenses always increase when you get a pay rise? • How much of your loans are financing a) consumer goods/services b) development projects? • Are you carrying assets (future) or liabilities • Do you mind the banks or your business ? • Are you a messenger to your cashier or the manager?
  • 12. PERSONAL NET WORTH STATEMENT CASH/EQUIVALENT KSHS LIABILITIES – LONG TERM Current account balance Savings account balance Other cash Cooperative loan Company loan Bank loan Shylock loan Car loan Mortgage loan Development (self/dependent education) Monthly family maintenance INVESTED ASSETS Cooperative shares Kiosk Plot Shares Savings/retirement plans Investment plans LIABILITIES – SHORT TERM Kiosk bill Bar bill I owe you Car repairs Hospital bills Credit card USE ASSETS Upcountry house Town house Household property TOTAL LIABILITIES PERSONAL PROPERTY Family business Chama/Group TOTAL ASSESTS TOTAL ASSESTS TOTAL NET WORTH KSHS
  • 13. HUMAN LIFE CYCLE- LIVE WELL, RETIRE SECURE CHILDHOOD 8-21 primary Secondary/college SENIOR CITIZEN & GOLDEN YEARS 71+…… death
  • 14. LEVELS OF FINANCIAL STATUS
  • 15. PROGRESSION IN FINANCIAL LEVELS 1.Courage 1.Courage 2.Self honesty 2.Self honesty 3.Delay 3.Delay gratification gratification 4. planning 4. planning 5.Taking action 5.Taking action
  • 16. JOURNEY TOWARDS FINANCIAL INDEPENDENCE
  • 17. PERSONAL BALANCE SHEET- MONTHLY INCOME KSHS EXPENSES Salary 1. Basic - Tithe/Offering -Tax -Food -Rent -Dependent education -Transport -Clothing -Utilities:((electricity/water/paraffin) Extra work 2. Secondary Entertainment Personal improvement Relationships Community Assets 3. Liabilities Loan/Sacco repayment TOTAL KSHS TOTAL SAVINGS > + 20%
  • 18. ACTIONS FROM YOUR PESONAL BALANCE SHEET • It balances • It does not balance now and I don’t intend to make it balance • It does not balance now, but will make it balance after 3-6 months And I will take the following actions to achieve the balance 1. 2. 3. 4. 5.
  • 19. THREE TYPES OF ASSESTS • Profitable business • Paper assets: - Savings plan - Retirement plan - unit trusts - Shares • Real estate
  • 20. THE SEVEN LIFE CASHIERS • God • Tax man • Community • Life style maintenance • Personal improvement • Relationships • Yourself ( 20% monthly savings)
  • 21. Principles of Financial Management • Financial Education Old Mutual School Of Money… “The Big 5 Secrets of Money Management”  The Secret of the Lion The lion eats first, ahead of the pack. You too should “eat first” by having an automatic deduction from your salary or wages.  The Secret of the Leopard The leopard never lets its prey out of its sight, patiently planning and moving towards its goal, never backing off or giving up  The Secret of the Elephant The African elephant never forgets. Its knowledge, aided by its memory, is its power. It remembers the places it has been, and uses this knowledge to plan its future.  The Secret of the Rhino The rhino’s weapon is to charge. When threatened, it looks for the biggest threat and charges, taking swift control of the situation. Confront your debt and charge it down  The Secret of the Buffalo The mighty buffalo is deliberate and steady, waiting all day for the hot African sun to pass. It steadily grows and protects its herd, knowing its strength and future are in its numbers. Page 21
  • 22. OMLAC Product Offering EDUCATION SAVINGS PLANS Rafiki Halisi Education Plan: A unit linked investment plan that offers compulsory life cover 10 times the monthly premium and pays out the accumulated fund value at maturity. Features and benefits: •There is choice between Money Market or Balanced Funds respectively. •Life cover benefits which is ten times the monthly contribution •Waiver of premium on disability or death for up to Ksh 20,000 per month for a maximum of 10 years • It has partial maturity benefits that is available four years prior to maturity. INVESTMENT SAVINGS PLANS Rafiki Halisi Investment Plan: Similar to the Education Plan above, the Rafiki Halisi Investment Plan is a unit linked investment plan that offers compulsory life cover ten times the monthly premium and pays out the accumulated fund value at maturity. Features and benefits: •There is choice between Money Market or Balanced Funds respectively. •It offers 100% accidental cover immediately. •Compulsory life cover which is 10 times the monthly contributions. Page 22
  • 23. OMLAC Product Offering…contd. LIFE INSURANCE An individual whole life product sold with an age – banded premium rate structured and minimal underwriting. Features and benefits a) Cover to the main member plus gives an option to have the spouse and children { up to a maximum of four children} covered at an additional discounted rate. b) A 50% money back benefit will be available if the lives assured survive a five year period provided the policy has been in force for the five years. c) 100% accidental cover available immediately d) A range of benefits starting from Ksh 50,000 up to Ksh 1 Million available for every a[pplica Page 23
  • 24. PERSONAL RECORD KEEPING ORGANIZER ITEMS FOR STORAGE IN BANK SAFE FOR STORAGE IN HOME ACTIVE FILE PERSONAL CURRENT INCOME/EXPENSES DOCUMENTS -Family birth certificates/adoption papers/death certificates -Marriage/divorce papers -Passports -Education certificates -Unpaid bills -Bank /credit card statements -Brokerage account statements -Unit trust /mutual funds/investments/insurance statements OWNERSHIP CONTRACTUAL DOCUMENTS -Title deeds/home plans/surveys/Home inventory -Vehicle log books -Business partnership agreements/Trust/stock/bond certificates -Loan statements and payments receipts -Equipment manuals and guarantees -Receipts of assets bought and copies of agreements entered into OBLIGATIONS AND CONTRACTS PERSONAL ESTATE PLANNING DOCUMENTS LIFE LONG REFERENC DOCUMENTS -Wills -Trusts deeds -Powers of attorney -Letters of instruction -Guardianship arrangements -Prior years tax returns -Prior business records -Prior family heath records -Proof of payments of debts and contractual obligations met -Prior bank statements -Mortgage charge documents -Insurance /investment policies - Retirement/pension plan documents -Employment /education records and certificates -Inventory and spare key to bank safe deposits -Copies of wills/estate planning and receipts of assets -Family health records/important phone numbers/emergency info -Tax return /mortgage /rental property/business expenses receipts
  • 25. Old Mutual Holdings Ltd Thank You contacts peris.kamau@oldmutualkenya.com Cell phone No. 0725 531 117