My Abu Dhabi Salary: ‘I save and invest half of my Dh16,000 monthly pay from oil industry’

Qavi Ansari also earns Dh25,000 in passive income a year from investing in ETFs, stocks, a property crowdfunding platform and National Bonds

Qavi Ansari makes sacrifices to maximise his savings. He does not travel often and limits his leisure spending. Antonie Robertson / The National

Qavi Ansari has been saving and investing 50 per cent of his monthly salary since he started working at the age of 22. The Pakistani, 31, aims to attain financial independence in about two decades.

He’s had to make sacrifices to maximise his savings and investments. He does not travel often and limits his leisure spending.

“I want to give credit to my wife since she supports my restrictive budgeting style when we could be spending and living a luxury life," he says. "She understands my goals and has fully aligned herself with our early retirement plan. It's not easy to do anything alone."

His family moved to the UAE 18 years ago when his father secured a job with Etihad Airways.

Mr Ansari is a mechanical engineer with a bachelor’s degree. He lives with his wife in Al Reef Downtown, Abu Dhabi.

What was your first job and salary?

My first job was as a mechanical, electrical and plumbing estimator in the construction industry in 2015 after I finished my university. I earned Dh3,000 ($816) per month. I worked there for one and a half years.

What is your salary now?

I moved to the oil and gas industry after my first job and have been in this current job for nearly eight years. I am a senior maintenance specialist with an oilfield services company and earn up to Dh16,000 a month.

Do you manage to save?

I aim to save at least 50 per cent of my monthly salary. I try to save as much as possible and I have been following this method since I started working almost 10 years ago.

Don't put your wants before your needs. Once you receive your salary, pay yourself first. I have allocated fixed percentages to pay off my house rent, utilities, groceries, expenses on my enjoyment and dining out, as well as my investments. This helps me track my expenses and save better.

In which asset classes do you invest?

In stocks and exchange-traded funds through the investment platform Sarwa, and also in savings and investment company National Bonds. I also crowdfund real estate through the SmartCrowd platform.

I have been investing in Sarwa for eight years. I also trade in stocks of Tesla, Boeing, American Airlines and Nvidia. I'm a long-term holder but when I started, I made the mistake of spending a lot of time buying and selling stocks in a short span of time. I readjust my portfolio once a month.

I invest 50 per cent to 60 per cent of my savings a month in Sarwa and then around 30 per cent in SmartCrowd, where I have been investing for three years. You can be a fractional owner of an apartment with even Dh5,000 or Dh10,000, depending on your budget. I have invested in three properties in Dubai this way and receive a dividend from the rents that's proportionate to my investment. I have been invested with National Bonds for 10 years and this is deducted from my salary every month.

You need to be a long-term investor if you plan to build wealth.

Qavi Ansari has been saving for retirement since he started working at the age of 22. Antonie Robertson / The National

Have you bought property in your home country?

No, but I eventually plan to buy a property in the UAE. If I see a good deal, I might liquidate one of my SmartCrowd investments and put it towards my property.

Do you have any debt?

I have a personal loan, car loan and a lot of credit cards. I took out the personal loan when I found a good investment opportunity with SmartCrowd. I use these credit cards to get offers and they are all free for life. I pay off all my cards every month.

Growing up, were you taught how to handle your finances?

Yes, by my father, both directly and indirectly. He used to give us pocket money to cover all our expenses every month and this taught me budgeting. He paid four children’s university fees, house rent, sent money to support family in Pakistan and saved for his retirement. So, we learnt about money management indirectly through him.

What are your major monthly expenses?

My house rent, car loan, personal loan and groceries.

How do you budget each month?

I used a mobile app for budgeting earlier but stopped using it nearly two years ago. I would put in how much money I need to set aside for shopping, dining, groceries, saving and investment. Once I started using it, I'd a clear picture of where I was spending my money. When I became consistent with my expenses, I switched to creating my own Excel sheet for budgeting.

It's divided into two categories, my monthly net worth, which reflects my current financial standing, and future net worth, which projects my estimated wealth for coming months or years based on expected income, investments and expenses.

Have you started saving for retirement?

I have been saving for retirement since I started working nearly 10 years ago at the age of 22. My target is to eventually attain financially freedom, so you need to start saving for it early. I aim to retire between the age of 50 and 55.

I’m working very hard now and don't have time for enjoyment. I miss time with my family as I don't travel back home too much or travel for leisure either. My wife and I just go out for dinner or visit a park. These are certain sacrifices I make now to reap the benefits of financial independence later.

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Do you have an emergency fund?

I used to have an emergency fund that would sustain my expenses for six months until the UAE government introduced the Involuntary Loss of Employment scheme. Now I’ve changed my strategy and only have three months’ worth of savings in my emergency fund.

If an emergency crops up, I could either use my emergency fund or tap into my investments because most of them are very liquid, except SmartCrowd. My investments in Sarwa and National Bonds can be liquidated in a week.

How do you spend your disposable income?

I allocate 35 per cent of my salary towards my disposable income, which is divided into three categories: shopping, entertainment and dining out.

Do you worry about money?

Like most people, I do worry about money because I need to plan for my future. But I try to manage my finances in a way that I don't have much financial stress, because I have an emergency fund and also make thoughtful spending choices.

What are your best hacks to offset inflation?

I take advantage of loyalty programmes like Share points and Shukran, reward apps like Zomato and Entertainer, and cashback on all my credit cards. I mostly shop only when there are sales and offers.

What are your financial goals?

My short-term goal would be to pay off my car loan as soon as possible because I'm not a fan of loans owing to the interest rate charged. I would rather save cash and buy a car. However, I recently bought my dream car, a Dodge Challenger.

My long-term goal would be to build a more diversified investment portfolio. I would like to invest in peer-to-peer lending platform Beehive and tap into private equity a few years later so I can eventually earn higher passive income.

What is your idea of financial freedom?

Once I have enough assets and passive income streams, I can cover my living expenses without relying on my job. That would allow me to have peace of mind and I can finally do the things I missed out on, such as travelling and spending time with my family.

Do you earn passive income?

I currently earn around Dh25,000 per year from my dividends through Sarwa, SmartCrowd, National Bonds and different private stocks. But I don’t cash out anything and all my passive income is reinvested. That's how you make the big gains. If you keep taking out profits, then you're losing a lot. Most of my passive income comes from my ETF investments in Sarwa.

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Antonie Robertson/The National