Sunél’s Blog | The Wisdom of our Grandparents

Sunél Veldtman, | 10 April 2020

During my childhood, my grandmother lived with us from time to time. Her presence had a lasting impact on my childhood memories. I remember how she scraped the bowl clean when she was baking, how she saved the leftovers of lunch for dinner and how she cared for her clothes. She wore a dress to my wedding that she had made for her own son’s wedding 25 years earlier.

She was a child of the depression. The depression and subsequent war imparted a biting financial awareness to an entire generation of children. It taught them that the future may be interrupted by forces outside of one’s control and that the only way to be prepared for it, was to save. They learned to be frugal with everything. They counted pennies and stashed money away in envelopes and tins.

They held onto that scarcity mentality throughout their lives. Because they knew what it felt like. 

We lack that perspective. For a long time, we have not faced this kind of disruption. Until COVID-19.

We have seen market crashes in our time, but we have not seen the rug being pulled out from under a whole nations’ cash flow. Even after 2008, the world returned to normal. Today, we are dealing with a massive cash flow crash. Last year, I wrote a newsletter to our clients about the importance of cash flow management in anticipation of disruption. I advised them to keep a moat of cash around them for the unforeseen. I had not, however, envisioned a disruption to come in the form of a virus and I did not anticipate the size of the unforeseen.

This virus reminds us of the wisdom of our grandparents.  Wisdom we have discarded. As a nation, we do not save. It has now left us personally and collectively at the mercy of others. Fixed assets and investments do not help when everyone else is looking to sell the same assets to non-existent buyers.

This will not be the last disruption either. If we can take one financial lesson from this crisis, it is this: save not for a rainy day, but a flood of Biblical proportions.