By Fikile Mbhokota
Have they heard of smart girl math? While “girl math” poked fun at how women ‘justify’ their spending, smart girl math celebrates women’s smart money – and investment – management. It originally referred to how women increasingly invest where they spend. More than that, it’s rooted in the idea of values and goals-based investing to grow wealth for the long term.
As women, we often juggle many roles — mother, daughter, professional, partner — and in each of these roles, the financial decisions we make are crucial to our future. So, how do we take a more strategic, long-term view of our investments while also staying true to the things that matter most to us? We get smart about it.
Smart girls know their goals
In my own life, I’ve found that the best way to align investments with your values is by having a clear sense of your long-term vision. For me, that means creating generational wealth, ensuring that my children — and their children — have the foundation to build on what I’ve started. It’s not just about me anymore; it’s about setting up a legacy.
As well as values, it’s critical to align your investing strategies with your goals and life stage. I have always tried to invest with a long-term mindset; I’m in it for the long haul. That means thinking about where I want to be in at least the next ten years.
When I was younger, I adopted a more tactical approach, but crucially, I still had a three-to-five-year goal horizon in mind. As a young adult, I needed cash flow for a house, car, and so on. Critically, I urge caution when tactically timing the markets. Trading fast requires a high-risk appetite as it can hamper prospective returns. Remember, compounding needs time.
Smart girls know their sectors
One of the ways I’ve practised smart girl math is through the Hot Orange Investment Club, which I co-founded with friends. This group taught me the value of strategic, tactical thinking in investing. We would assess sectors and make calculated decisions based on market trends. For instance, in the lead-up to the 2010 FIFA World Cup, we invested heavily in construction companies, knowing the infrastructure demands would yield positive returns. Similarly, when interest rates dropped, we tilted our portfolio towards retail stocks, anticipating increased consumer spending.
This experience taught me that it’s important to know the landscape, understand the macroeconomic environment, and adjust your portfolio accordingly. Again, we worked with two-to-three-year goal horizons in mind.
Smart Girl Math in action: How to build your portfolio
Here are some key lessons to keep in mind to apply smart girl math to portfolio building to yield strong returns over time, aligned with your goals and values.
Set your long-term goals
Think beyond the next few years. What do you want your money to do for you in 10, 20, or even 30 years? For me, it’s about generational wealth and financial freedom, so I focus on long-term investments that I don’t intend to touch for at least a decade.
Start with what’s accessible
The beauty of investing today is that there are so many accessible options for people at different stages of their financial journey. If you’re just starting the journey, you could start with a balanced unit trust, where asset allocations are made on your behalf. If you're in it for the long term, you may want to consider an indexation option that tracks equities. If you’re concerned about the rand, you could opt for offshore exposure.
Understand the market cycles
One of the core lessons of smart girl math is understanding the economic landscape. For instance, knowing how interest rate changes affect consumer behaviour or recognising when certain sectors (like retail or construction) are likely to perform well can help you make smarter investment choices. Read, listen to podcasts, ask questions, read more!
Incorporate your values
If your values centre around family, education, or financial independence, seek strategies that reflect those priorities. Whether it’s an exchange-traded fund (ETF) for your children’s education or investments that provide long-term financial security, ensure that your portfolio aligns with what matters most to you. Many people also want to contribute to their country. If transformation and inclusivity are core values then seek ETFs, for example, that promote diversity and inclusion.
Diversify and balance
It’s essential to balance your portfolio. While some investments might be high-risk, and high-reward, others should be more stable, and long-term. I always make sure that my portfolio is well-diversified to protect against market volatility. Know yourself and how much risk you’re willing – and able – to tolerate.
Think generationally
Whether it’s setting up an ETF for your child from the day they’re born or ensuring that your wealth is protected for future generations, think about how your investments today will impact those who come after you.
In the end, smart girl math isn’t just about numbers — it’s about values. It’s about making sure that the financial decisions you make today reflect the world you want to build tomorrow. So, take the time to understand your goals, build a portfolio that aligns with your values, and always keep your eye on the long term.
* Mbhokota is the CEO of Satrix.
PERSONAL FINANCE