Hi Gwen, can you introduce yourself within a few lines?
Hi! I’m Gwen, I’m 26. In 2019, after graduating from business studies, I launched Kaki, the first Asian cake bar in Brussels. For this, I developed a new kind of cake based on an Asian recipe. Recently, after a year and a half of managing the restaurant, I sold it in order to focus on other business ideas. I wanted to become more flexible in time, and location.
I am passionate about creative matters. I feel empowered and fulfilled when I create things: products, concepts, images, places, products etc. I got a lot of ideas and I feel happier and get more energetic when I have the time to make those things happen.
I would describe myself as a positive, genuine and faithful human. I am also a truly ambitious and go-getter entrepreneur, I can do anything that it takes to make my ideas and goals come true. I always have a vision in mind and I feel confident that no matter what happens, I will be flexible and get myself out of difficult situations.
Can you share more about how that first entrepreneurial experience went for you?
It took me a full year after opening my business to be able to get a decent revenue out of it even though I wish I could have earned money from the restaurant before. My objective was to start paying myself after 6 months so I kinda failed in that matter. Looking back, I realise that what held me back was not related to the business and the possibility to pay myself, but rather to the fear that if I’d pay myself, the business would lose money.
Can you talk to us about your current financial situation?
Before I launched my company, I used to work as a student worker. I used to earn on average 800€ per month. Back then, I would save around 200€ per month because I believed it was important to save for the future. I’ve always had in mind that I would purchase real estate, set up companies and invest in stock as soon as I could. That’s how I managed to set up my company only a year after my studies: I saved approximately 10.000€ in 6 years. I put every penny I had into it. A year after the opening I had saved 15.000€, again, by reducing my expenses as much as possible. It helped me to invest in real estate and now with the sale of the restaurant, I will be able to set up other businesses, and invest more!
As of now, I temporarily help my mother in her shops and I earn around 1.000€ a month. I also work around 5 hours a week as a freelance consultant in branding which activity generates around 1.200€ a month. All of this goes right into my company and I don’t get myself a salary at the moment because I am just taking some time for myself. I anticipate that in a month or two, I will be able to launch these new projects I’m working on. That’s when I’ll start paying myself back.
Thanks to my early savings, I now own real estate, have cash in the bank and some investments in both cryptocurrencies, and stocks. My wealth is around 220.000€ and I only started building it 7 years ago. All of that from scratch! That simply happened by working hard, and then saving or investing at least 30% of my monthly revenues. Because I always tend to have investment projects in mind, I know how important it is to save, so I always try to save more than half of my revenues. This is especially the case because you need upfront cash to invest in real estate. I also invest a minimum of 10% of my earnings in cryptocurrencies and/or stocks every month.
What other objectives do you have as a young professional?
In 2021 my objective was to buy my first property, which I achieved at the end of December! Now that I sold my first entrepreneurial project (Kaki), my 2022 goals are to create a new business that would allow me to work from anywhere in the world.
I am also looking forward to becoming truly financially independent by the end of the year. To me, becoming financially independent refers to the ability you have to generate money and be able to spend it or invest it without actually working to earn that money. It could be achieved by investing, which I would prefer, or earning larger amounts which would allow me to cover my expenses for a lifetime.
Nevertheless, the reason why I want to become financially free is to be able to focus, stress-free, and at peace (with regards to money coming in against my expenses) on the work that truly makes me happy: developing new products, concepts, ideas, and making that happen. I am also good at creating opportunities and I want to be financially free so that I am fulfilled, happy and in the best mood to create more opportunities for business and personal growth.
Can you tell us more about your perception of money, or wealth?
I am not that much into analysing each and every expense because it generates feelings of guilt about everything that I might have spent. Rather, I prefer to convince myself that I can afford what I want. Anytime I want something that will truly make me happy, I make sure to afford it and thank myself for the ability to purchase it.
Money, to me, is extremely positive and powerful. In our society, it’s oftentimes the only thing that separates us from making our dreams come true. We’re used to giving it a negative vibe and stressing over it while we should have a positive attitude towards it. We should thank it in advance for coming and making our dreams come true. Money is often badly perceived because of jealousy and frustration and because we are all taught that money comes only through work and that work is limited because of time if we’re hourly paid. The thing is money is not limited, money is abundant in this world. We just have to think outside the box to realize that we can actually earn more in many different ways.
What advice would you give to other young professionals?
I am a true believer in the power of intuition, positivity, passion, fulfilment, personal goals, and the law of attraction. I believe you can make anything happen as long as you pursue goals that fulfil you with passion. Listen to your intuition and have faith. Everything will align to generate what makes you really happy and peaceful.
I used to fear the lack of money, and more importantly, I feared losing money. For a long time, I avoided spending money. But afterwards, I started reading a lot about the law of attraction and my mindset shifted. I realized that we might block our own capabilities of attracting and achieving what we want in life because of our fears. If you fear losing money, then you won’t take any risks although the outcome could actually be great. It’s basically the same for any other fear: the fear of being judged, being rejected, the fear of being denied. So we actually don’t take any risk to avoid this. As I worked on myself, I started to analyze things differently and a quote now resonates a lot with me: ‘you never know’!
I’ve been through hard times, struggling with money because I restricted myself thinking I couldn’t afford anything. Now I am more into “what do I want to spend my money on?”, and “what do I need to be able to afford it?”. So I would say, change your mindset and realize you’re the only one limiting yourself. Do not think of what you currently have, but rather focus on what you need or want to have. It will push you rather than limit you.
What tips would the financia.io team give Gwen?
Gwen seems incredibly focused on her objectives. She’s full of confidence that she will be able to reach them, and why wouldn’t she? Passion and determination can’t fail her. These are, without a doubt, the traits for success.
Gwen also has an advanced conception of personal finance. She understands how much of a role it plays if she wants to reach her objectives, becoming financially independent is one of them. She started saving and investing years ago and now, as a result of her hard work, she’s taking it to the next level. She also has a great habit of “Dollar-Cost Averaging”: investing regularly and reducing exposure to volatility. Thanks to that, she controls risk, and she does not have to worry about when, and whether she should buy.
“With greater power, comes greater responsibility”. This also works as far as wealth is concerned. Disposing of more wealth also means an increasing need to protect it, to maintain a steady growth rate, if possible. As an entrepreneur, Gwen understands that perfectly, however, she will face increasing choices and parameters that might play against her.
- Inflation is one of these parameters. In order to counteract it effectively, we need to maintain cash yielding assets or anything that allows for compounding value. Today, this is hardly done through a savings account at all given the very low-interest rates they offer. We, therefore, need to turn towards assets such as real estate, yield producing cryptocurrencies, dividend stocks and—of course—business cash-flows. Arguably, investing in the stock market, some type of bonds and precious metals might be part of such a strategy.
- Risk is another parameter: as wealth grows, you find yourself in the need to protect yourself through diversification. Gwen has already mentioned that she invested in real estate, cryptocurrency and stocks so she doesn’t only save cash. This is a great start. Now, we don’t know how well Gwen has diversified within each category, but that might as well be a good strategy. Not all stocks or cryptocurrencies behave the same, for instance. Sub-category diversification is not to be forgotten. With time, she will be able to enter even more categories in general.
- Today, it also seems increasingly more important to consider other types of diversification. What is currently happening in eastern Europe perhaps raises concerns about having all of your assets in the same jurisdiction. Geographical diversification matters too. The same goes for technological diversification. In a world where everything is digitised, it might be wise to seek to protect wealth amongst various platforms.
As an entrepreneur, Gwen embraces the need to put money down forward to kickstart her projects, before they even yield. In that case, it is always very important to do a cost-benefit analysis and to ask yourself if what you are doing is aligned with your personal risk aversion. If you are like Gwen, you will tolerate more. However, typically, as life progresses, this tends to shift depending on your needs. One can imagine that family, living costs and others will naturally progress and perhaps change the picture for your endeavours.
Think about regularly “auditing” your expectations and computations according to your context and the current stage of your life, as well as your aspirations. Remember that personal finance is part of personal development, after all, it always complements the other parts of your reality, all intricate. As long as you keep that in mind, you ensure that your finances truly work for you, and not the other way around.
There’s no doubt that Gwen does an amazing job at working on her psychology, so we will hardly teach her anything in that regard. Go, Gwen!
Just like Gwen, you can identify your objectives, strengths, and weaknesses when it comes to personal finance. This is the best way to set yourself up for success.
Thankfully, financia.io is currently building a free personal finance platform to help you do that! We encourage you to sign-up below to get notified whenever it is launched.