It took me a while to decide whether I should publish this blog post or not, as I appreciate anything that encourages and/or enables people to invest their money. However, I feel that it's important to share this message, so here we are, published.
Over the last decade or so (it's probably longer, actually), I've spent a lot of time, sharing my financial knowledge with anyone interested or willing to listen. Most of you know my story, so I won't go into that, but my story fuelled me to learn as much as I could about finances, and if I can inspire someone or share something that helps someone, that means the world to me. As such, I spend a lot of time on various platforms and forums answering questions where I can, offer opinions and doing my bit (like, writing this blog or doing a webinar). It's for this reason, that I'm writing this blog post about EasyEquities, because I have a concern.
I remember when EasyEquities first launched, it was a long time ago. I have an account with them that I opened, and funded, back in 2015, to give you an idea. If I remember correctly, they started gaining popularity by being one of the only platforms that made buying stocks/shares/equities easy for anyone, their fees were incredibly competitive and when they introduced fractional share buying, they grew at a rapid speed. It's great having a platform that offers South Africans the ability to buy shares in companies like Apple, Nike, and other US-based listed companies. Backed by The Purple Group, who saw insane growth a few years later, the platform was simply positioning itself as undefeatable. Forums blew up about how it's the easiest and best platform to use, thousands of every day folk flocked to the platform to start buying their positions in big tech companies. To this day, EasyEquities gets pushed at every single opportunity by people who aren't affiliated - that's impressive. Heck, EasyEquities just published that they had R1.78 billion in deposits in April alone, totalling R5.76 billion year-to-date.
However, I have a problem with EasyEquities.
When a normal person (some who doesn't know much about investing but knows they should) starts investing with a platform, their knowledge is usually low - This might be their first time investing, and they're signing up because others say it's the place to sign up. Where I have a concern is that this is quite a blind approach, and if there's one thing I hear a lot about EasyEquities, it's that their support is terrible. Why does this concern me? Well, think about it, you're new to investing, you're taking your hard-earned money, which there might not be a lot of, and you're investing in a platform that you feel like make you a lot of money (that's a typical narrative). But, what happens when something goes wrong? As a novice, mistakes get made (been there, done that, more than once) and when you can't get hold of anyone to help you, you go into a flat panic. I've been there, I know what it's like to invest the money you have and to run into a problem, and there's nobody to assist, it's one of the scariest experiences you'll ever face. Imagine you did something, your money went to the wrong place, and it's been 3 days, and you're yet to know what's going on... stop and picture that for a moment. Heck, picture it when you've been investing every month for 20 years and it happens!
So, you have people looking to invest, others punting EasyEquities, and a lot of people entering a platform where they might end up with a really unpleasant situation. I dislike that, I don't care if there are terms and conditions or whatever to protect them against complaints, the fact of the matter is that there are too many reports about the non-existent support and that's bad news. They know their target audience (obviously), why not bake in some decent support. And, let's face it, most of the people recommending EasyEquities have probably only been invested for a couple of years, they haven't gotten to a place where they might need to do anything outside simply depositing a monthly amount and smiling at how seamless it is. It's a bit like the blind leading the blind, into a potentially difficult position.
I don't dislike EasyEquities, I actually really like what the company offers in terms of exposing South Africans to share purchasing with ease. I really like that their fees are low and that they're not trying to take some ridiculous 3-4% like many other investment houses. I like that there's a community that supports them and encourages others to invest - we all know how this country desperately needs people to invest and grow wealth, to pay taxes, donate to charities and grow our economy. So, this isn't a disgruntled blog post attempting to put EasyEquities down, it's a post that's raising what I feel is something that shouldn't be ignored, and is happening more and more. Perhaps EasyEquities will take note of this.
I'm not sure what the answer is. I mean, surely EasyEquities is aware of this problem? They have active social media channels on Facebook, Instagram and Twitter. They do have a support ticketing system. They'll definitely know that response times are too slow and people are unhappy. I appreciate that they have a lot of customers (considering the total deposits in April alone, easy assumption), so surely they could scale up their support to reduce this rising concern? Yes, it costs money, and yes, The Purple Group's share price dropped as quickly as it rose, but this is crucial - onboarding people who aren't savvy, kind of borders on convincing people to start gambling at a casino, in my mind. It's like these American platforms such as Robinhood, who've taken huge heat for creating platforms that are so similar to gambling but hide behind cleverly-phrased legal terms. Perhaps I'm stretching a little here in many people's minds, but I don't believe I am entirely. This is people's hard-earned money, money perhaps for their kid's education or for medical expenses, and here they are being pushed into a platform, which cannot support the support demand - simply doesn't sit well with me.
Or, is this simply a situation of: low fees means low support, but we'll hype up the low fees part and be very quiet about the low support?
What do I do...
I've invested with Satrix for over a decade as well, and that's the platform I've decided to use for the majority of my investing, including my TFSA and my child's TFSA. The fees are higher with Satrix, but I see that as a price I'm willing to pay to know there's a certain level of decent support. The fees are still very good compared to a number of the other brokerages, I did my research on this. I don't want to write that Satrix is better because that's not my aim here, and the platforms are different, this is rather about me being transparent. I have no affiliation with EasyEquities or Satrix, or any other brokerage for that matter - I run a marketing company and I love gardening. I'm not putting affiliate links to EasyEquities or Satrix, or anything else, in this blog post to avoid seeming biased. I'm merely sharing my experience, and I consider myself fairly experienced with all of this local investing.
You need to do your own research and make your own choices, but please do that research thoroughly because if you start investing now, remember that you might have that one situation or one question in 30 years time when this is your money to retire, and you don't want to be in your 60's or 70's unable to get an answer for something as huge as whether you can retire or not!
