What Nelson Mandela can teach you about your finances

Nelson Mandela is one of the few individuals who single-handedly changed the course of human history in a profound way. Unlike other famous leaders, such as Genghis Khan, Hitler or Napoleon, he altered the course of our nation (I’m South African) by eschewing all the traditional political weapons of mass destruction: revolt, violence and revenge. Instead, as depicted in the movie Invictus, he achieved his goals by peaceful means, earning him the Nobel Peace Prize in the process.

I was en route from South Africa when I saw the news on the monitors at a transit airport. The remaining flights gave me ample time to reflect on the lessons we mere mortals can learn from this great leader. There are several:

1. Know your goal

Nelson Mandela had a goal,  clearly defined and understood by everyone: a nation where everyone is able to have a say in its leadership. Everything he said and did, he said and did in pursuit of that goal.

You need to have a financial goal, something more than making payments, hanging on to your job, getting more goodies, or just surviving the holiday shopping season. It has to be simple and easy to understand. If it looks unachievable, that’s okay. As Mr. Mandela’s life shows, you never know what can happen if your life is set on a single, easy-to-understand goal. If you don’t have a clear goal, well, you won’t reach it.

2. Pay the price

Nelson Mandela paid dearly: He spent more than 25 years in prison. If you look at most people with noteworthy accomplishments, you’ll usually find several sacrifices along the way. Warren Buffett is famous for his frugal lifestyle early on in his life. Today he wears expensive suits and uses private jets to get around — why buy a jet when you can buy a company with an entire fleet of private jets? But in his early days, he was frugal to the point of penury, because he measured every spending decision against the yield that expenditure would bring if he invested it.

To achieve your financial goals, you will have to make multiple sacrifices.

3. Focus on the future

If ever someone had reason to dwell on injustices done to him (and his people) in the past, it was Nelson Mandela. However, he understood that little is achieved when you allow your past to dictate your actions. He set his goal for the future, and he made his every decision to get him closer to that goal. The future is all that matters to achieve success.

Same with you and your money. The past is the past and there’s little you can do about it. And it’s usually not a predictor of the future. Your key to success lies in judging every decision only on what it can do for your future. If you think you waited too long to start saving, forget about the past. The question is which holds the better future: saving now, or continuing to not save? What you save starting now might be less than it would have been if you started 90 years ago, but it’s guaranteed to be more than if you did nothing.

4. Utilize opportunities

When Nelson Mandela was in prison, his opportunities were few, as you can imagine. Yet he furthered his legal studies and became knowledgeable about constitutional law. In the unlikely event he would be freed, he needed to be prepared for the next challenge — figuring out a better way for his country to live.

You may feel you have few opportunities where you are today. And the opportunities that presently exist may entail sacrifice. Your company may offer reimbursement for furthering your studies, for example. That’s an opportunity to increase your human capital and your worth in future jobs. But it will take time away from going to movies, socializing with friends and leisurely vacations. You might even have to give up football or shopping for a few years.

But the goal is worth it. If you seek out the opportunities in your neck of the woods and pounce on them, you may find yourself in a much better place a few years from now and therefore be able to achieve those goals of yours.

5. Be pragmatic

Nelson Mandela was not a communist by conviction; but when it turned out that those were the only people who supported his cause and were willing to help him reach his goal, he made the pragmatic decision to align himself with an unpopular group of people. However, he did it without compromising his principles and in a way that helped him get to a place he could not get himself.

In your job, you may have a boss you despise or a 401(k) retirement plan with many flaws. A 401(k) plan is a way to save money with help from Uncle Sam and (usually) your employer. You will reach your goal by maximizing those plans, even if you’re not planning to retire there.

6. Tune out the noise

Mr. Mandela was accused of many things and characterized in ways which would have discouraged any of us. Even his own supporters at times called him lame and useless, and they labeled his non-violent preference outmoded and ineffective. Yet he stayed his course: he knew his goal, unflinchingly paid the price, focused on the future and pragmatically seized every opportunity available to him. If he had paid attention to his critics, it’s almost certain the world would not be celebrating his achievements this week because there wouldn’t be any to celebrate.

Likewise,  you will face noise as you pursue your goals. Your coworkers may call you a brown-noser, your spouse may resent the time you spend on training, those ads in the mail and on television will always be there to distract you, and God knows how many banks will try to ensnare you in debt.

Your goal may not be to win a Nobel prize or change the world. But you are the one who determines your future. You will reach your goals only if you tune out the noise and stay the course. Along the way you’re guaranteed to wonder if it’s all worth it; Nelson Mandela undoubtedly did too. Success, though, only comes to those who know their goals and single-mindedly do whatever is necessary to get there.

5 Responses to “What Nelson Mandela can teach you about your finances”

  1. Anonymous

    As an ex-South African, I totally relate to this article. Mandela (Tata Madiba) was a brave and smart man. I am 100% positive that he knew exactly how to handle and manage his finances in a genius manner. I would love to find out more about the way he handeled his finances.

  2. Anonymous

    I wonder how Nelson Mandela managed his finances, I’m thinking he was as frugal as they come always thinking about his grand children’s future. This is a great post, nice to read about the great man and personal finance in one post.

  3. Anonymous

    Brilliant post, if we can apply Nelson Mandela’s principals to personal finance then we could make a lot of progress really quickly. Utilizing opportunities is a great way to get ahead, being in a positive frame of mind helps you to see those opportunities that would otherwise go right over your head if you were in a negative mood. Top draw post.

  4. Anonymous

    One thing Nelson Mandela taught me which I apply to money is to always start with an end in mind, I think later Stephen Covey used this in this book 7 Habits of Highly Effective People. I definitely plan ahead and continually think about my end goal whenever I start something like savings, it always helps. Great post, thanks for sharing.

Leave a Reply