A Guide to Online Banking Safety

71% of bank customers regularly use online and mobile banking options. However, many people do not completely trust online sources and may worry about their information being stolen when choosing an online bank. 

Are you looking for ways to protect information and improve your data security? Keep reading these tips for online banking safety to learn more!

Don’t Use Public Wifi or Computers

One of the most important online banking safety tips to keep your information secure is to only sign in on your personal network or device. When you use public wifi that many people have access to, you never know who will be able to see your browser history or password. 

This is also true for public computers. If you were to accidentally save your password for your online banking institution, it would be easy for a complete stranger to access your bank from the same computer. 

To avoid these potential disasters, it is always best to use your own devices and your own wifi network whenever you have to log into a password-protected website. 

Scan Statements for Fraud

While you want to do everything you can to prevent fraud, it is also important that you are able to identify any fraud as soon as possible. 

One way that you can do this is by regularly scanning your statements for fraudulent activity. Check your bank statement for any purchases that you do not remember making. 

While banks do their part to identify fraud, some purchases may not stand out to them. By looking for fraud in your own account, you may be able to catch suspicious activity. 

Use Anti-Virus Protection

Next, it is important that you protect your devices with anti-virus protection. This can keep you from getting attacked by any viruses or malware. 

Most computers come equipped with some type of anti-virus software, but you want to be sure that you frequently update it for the best protection for your computer. 

Understand Common Scam Techniques

Something else you can do to protect your online banking information is to recognize and understand common bank scam techniques. Scammers will frequently use the same tactics to gain access to your information, so understanding these will prevent them from targeting you. 

One common scam technique is sending you links in an email. While the email may look legitimate, you may find that clicking on this link may lead you to a fake website that looks just like your financial app. Digital currency investors are a big target for this type of scam due to the increase in cryptocurrency prices. A famous example of this was when MyEtherWallet users were sent an email asking them to update their login credentials. In doing so, they gave cyber criminals access to their account where they stole all the assets.

To avoid this scam, it is always best to re-type the URL to your banking institution rather than clicking on a link. 

Your bank will also never request your private information over the phone or over email. If anyone is asking you for information to gain access to your account, you should hang up and call your bank directly. 

Regularly Update Passwords

Many people will re-use the same password for many different websites. However, if someone guesses your password for one website, they may try using the same password on another website.

This is why you should always make your banking password unique from other websites. 

The easiest way to combat keep people from guessing your password is to update and change your passwords regularly. Typically, it is best to change your password once every few months.

Then, anyone who had access to your account will be kicked out with the new password. 

You should also be thoughtful about the types of passwords you use. If you make them one word or if your password is something easy to guess, like your name, people will easily be able to gain access to your account. 

To make your passwords more secure, you should make them a long password with multiple words, numbers, or special characters. 

Sign Up For Text Alerts

If you want to make it easier to identify any fraudulent purchases, you can always ask for text alerts from your online bank.

Banks can send you emails or texts whenever there are large transactions made from your account or if your balance drops too much. 

If you notice that you didn’t make a purchase or transfer money from your account, you can immediately call your bank to stay protected from fraudulent activities. 

Carefully Choose Your Bank

Finally, it is important that you do plenty of research to find the best online bank. If you know that you can trust your bank, you know that they will do anything to protect your assets and information. 

Make sure you check online reviews for banks and you understand your banking needs before you make a decision. You should also prioritize finding an institution with high security to prevent data leaks or hackers.

For example, things like multifactor authentication make it much more difficult for people to gain access to your account without your knowledge.  

If you want to learn more about choosing a bank, check out this article on factors to consider when choosing a bank. 

Improve Your Online Banking Safety Today

You can easily improve your online banking information when you focus on data security. By following each of these banking safety tips, you will not have to worry about fraud, scams, or any other data leaks. 

However, the most important thing you can do to improve your online banking safety is to choose a reliable and trustworthy organization to work with.

Make sure you choose the best online bank so you can be confident in your banking!

Do you want to learn more about online banking and other safety tips? CFI.co can help! Check out our articles on finance and banking to learn more helpful tips. 

Commercial Banking vs Retail Banking: What’s the Difference?

The global market size for financial services is expected to reach an astounding $22.5 trillion in 2021. That figure will climb to $28.5 trillion by 2025.

Among the biggest players in the financial services industry are retail and commercial banks. Both types of institutions are of critical importance to both the domestic and global economies.

But exactly what is retail banking, and how does it differ from commercial banking? If you’re asking this question, you’ve come to the right place. This post sheds more light on the commercial banking vs retail banking discussion.

What Is Private Banking?

The terms retail banking, private banking, and consumer banking are often used interchangeably. They refer to a division of banking that handles retail customers. 

Retail banking focuses on dealing directly with clients located in a close city or town. The retail bank handles much of its activity face to face, in a manner clear and visible to the client.

Given that retail banks serve many clients with a multitude of transactions, it’s referred to as mass-market banking.

Note that retail banking doesn’t solely depend on physical locations. The term simply refers to the business model followed. Simply put, retail banking operates on relatively small or medium-sized transactions.

Thus, many retail banks allow their clients to enjoy the benefits of digital banking by providing online banking services.

The most important source of funds in retail banking is customer deposits. The bank makes a profit through service charges and fees. The institution also earns income from the interest they charge when they lend out money to clients. 

What Is Commercial Banking?

Now that we’ve seen the retail banking definition, it’s time to look at another popular type of banking: commercial banking. Also known as corporate banking, commercial banking provides services to businesses and governments. 

Generally, these are stocking corporations that make money by acting as financial intermediaries

Corporate banks tend to have physical locations from which they offer their services. In the recent past, however, these institutions have been increasingly operating online. 

Commercial Banking Vs. Retail Banks: The Main Differences

Retail and commercial banking differ in several important ways. Let’s take a closer look at some of these differences.

Services Offered

Both types of banks provide a large variety of services to their respective clients. Retail banking clients can expect these services:

Checking and Savings Accounts

A retail bank allows its customers to open checking and savings accounts. Once you open a checking account, you’ll be required to pay a monthly fee. 

With a savings account, you earn a slightly higher interest rate. However, you cannot have checks written on the account.

Mortgages

Retail banks also offer different mortgage loan types to their clients. These loans are meant for buying either residential or investment property. Generally, mortgages earn a substantial chunk of retail banking profits due to their size.

Auto Financing

Clients looking for vehicle financing can also talk to retail banks. The banks also provide refinancing for existing car loans.

Credit Cards 

Credit cards are one of the most lucrative sources of interest income for banks. That’s because this service attracts some of the highest interest rates in the industry.

There are, of course, many other services retail banking offers, but these are among the most popular.

Clients looking for commercial banking services can benefit from the following offerings:

Loans and Other Credit Products

Just like retail banks, corporate banks offer different loan facilities. Perhaps the biggest difference here is that the loans involved.

Corporate banking offers more substantial compared to those offered in retail banking. 

Treasury and Cash Management Services  

Corporate banking clients can also benefit from treasury and cash management services. Such services help clients manage their working capital besides meeting their currency conversion needs.

Equipment Lending 

Clients can benefit from customized loans and leases to acquire a range of equipment. Such equipment may be used in a variety of industries, including manufacturing, IT, and transportation. 

Other services offered by corporate banks include:

  • Trade finance
  • factoring
  • letters of credit

These are only some of the services offered by corporate banks. Corporate banking clients can expect to find a range of products they can use to meet their business financial needs.

Target Clients

There’s a huge difference between the clients of these banks.

Generally, retail banking focuses on individuals. Commercial banking is more concerned with corporate clients, from SMEs to large conglomerates. 

Volume and Value of Transactions

In retail banking, the volume of transactions is typically high. However, the value of transactions is low, given that the client base consists of individuals and small businesses. 

In contrast, the volume of transactions is much lower in commercial banking. The value of these transactions, however, is considerably much higher as the client base is typically made of sizable business enterprises. 

Product Customization

Generally, retail banking involves little product and service customisation. Most products are standardised, also referred to as off-the-shelf products. 

Things are different with corporate banking, customised where the products and services are highly personalised to meet the client’s specific requirements and preferences.

Commercial Banking Vs Retail Banking: Now You Know The Differences

Hopefully, the commercial banking vs retail banking conversation is clearer to you now. While the two banking approaches provide services essential to the economy, their target clients, volume and value of transactions, and service customisation levels are significantly different. 

We hope you enjoyed this article about the differences between commercial and retail banking. Are you looking for more information about finance? Check out our blog section for more content.

What Is Retail Banking Exactly?

Did you know there are over 6000 banks and financial institutions in the US alone? Each of them serves a different purpose concerning customers and the broader local and global economy. But do you know what makes a retail bank different? Knowing how they work can help you make better choices regarding your finances. Read on as we discuss everything you must know about retail banking.

What Is Retail Banking?

The retail banking definition is of a bank that provides financial services to members of the public and individuals instead of businesses. It is also called personal or consumer banking. 

They provide a range of services such as loans, personal accounts for checking and saving, credit cards, and mortgages. They allow people to deposit money and gain access to lines of credit. Retail banks may be local community banks or branches of larger banks. 

This is in contrast to a business banking service. These are only offered to small and large businesses and offer different services and rates. 

How Does a Retail Bank Work?

When a retail bank gets money from a customer deposit, it will use this to earn money. The deposit will be put toward issuing a loan, on which they charge interest.

Different loans have various rates and periods in which they need to be paid back. For example, a mortgage loan will be paid over a long period and have a lower interest rate–as it is a significant amount. On the other hand, credit card debt needs to be paid back quickly and has higher rates.

Banks will offer steady interest rates to tempt customers to keep their money in the bank. They will also get profit from transaction and service fees. For example, they may charge overdraft fees and maintenance costs on specific accounts. 

Types of Retail Bank

Retail banks can be broken down into two main types. These are commercial banks and cooperatives with credit unions. Though they offer many similar services, they do bear fundamental differences. 

Commercial Banks

Commercial banks offer all the services you would expect from a consumer bank, often providing a wide range of services. Interest rates are charged on loans, and transaction fees are taken to make a profit. They will generally have a broad interest rate spread during good economic times to make more profit. 

In downturns, they will lower rates to attract more customers. Using a combination of interest rates and banking fees, they turn a profit. This is given to shareholders, the key factor making it fundamentally different from credit unions and cooperatives. 

Credit Unions and Cooperatives

Credit unions and cooperatives offer much the same services as commercial banks. However, they will not have the breadth of choice or range of services. You may also find that they have shorter opening hours and fewer employees. 

However, these establishments do not use their profit for shareholder dividends. Instead, the money is relocated to the customers themselves. This means lower interest rates on loans, higher interest on savings, and reduced transaction fees. 

Services Offered

Retail banks will offer several services to customers. Depending on the size of the bank, these may have different terms and conditions that help fix one to your needs. 

Transaction Accounts

These are the standard accounts that allow people to make deposits and withdrawals when they see fit. It will often be the account people have wages deposited into. In the US and some other countries, they are often known as checking accounts. 

Savings Account

A savings account allows depositors to hold money for long periods and gain extra interest on it. They are less liquid than transaction accounts, often having stipulations for the withdrawal of funds. In compensation, interest rates will be better than the transaction account. 

Cards

Cards include credit and debit cards. A credit card allows a customer a small line of credit for free use. This often has a higher rate of interest than longer period loans. 

Debit cards work similarly. However, they do not offer credit.

When you use the card, money deducts from the funds in your transaction account almost immediately. Therefore you can never spend more than you have.

ATM cards would also come under this category. They allow people to take money from an ATM in a particular geographical location or district.

Loans

Banks make money from the interest charged on loans, and they are a vital part of their operation. You will find a vast range of loans available from a bank. They could be long-term home improvement loans or short-term personal loans.

Online Services

There are few banks these days without online services. This will let you do e-banking, checking your statements and making transactions online. This frees up labour at the bank itself and gives you 24-hour access to services. 

Functions of a Retail Bank

Retail banks do not just serve consumers. They are part of the larger economy and provide an essential role within it. All banks are overseen by the central bank of the country they are situated in and must abide by the fiscal policy.

For example, they can control the supply of money in the economy. By adjusting the interest rates and adjusting requirements for credit, they can decide how much money is available. 

They can also stimulate the economy by lowering the costs of borrowing. When the economy needs help, they lower interest rates to increase consumer spending. In times of prosperity, this can rise, resulting in more profit.

Learn More About Retail Banking

When choosing retail banking, make sure you shop around. Different banks will have a range of services, some of which may be better for your needs. Get recommendations online or ask friends, family, and colleagues who they use. 

If you need assistance making the right financial decisions, then CFI.co should be your first stop. From savings to shares, we are the online resource for everything you need to know about the world economy.

Click here to see all our articles on retail banking. 

The Benefits of Private Banking

Private banking is an exclusive service offered to people with a high net worth. The best private bank will give you a dedicated relationship manager and, in some cases, uses a team approach to give you expert advice on a variety of financial subjects.

Clients get access to a range of financial services, which may include financial planning advice, exclusive credit cards, portfolio management, investment strategies, retirement planning, and hedge fund investing among others.

While often used interchangeably, the terms private banking and wealth management don’t refer to the same thing. Wealth management is a broad category that deals with optimizing a client’s portfolio. Personal banking offers personalized care and management of finances for the extremely wealthy.

Do You Qualify for Private Banking?

Being the realm of the rich, private banking is not available to everyone who has a savings or checking account. The specific eligibility requirements vary from bank to bank, but the service is reserved for high-net-worth individuals. Some banks are happy with clients who have six figures in investable assets while others demand eight-figures.

Investable assets are any assets that are liquid or easily liquidated. They may include the money in checking and savings accounts, bonds, retirement accounts, money market accounts, trusts, and stocks. Understandably, many banking institutions don’t make their standards known.

It is possible to qualify for private banking even if you don’t meet the minimum requirements. A good example of an exception to the rules is the children of wealthy individuals. Banking institutions are always looking to the future, specifically wealth transfers. They want to make sure that funds stay with them even after the wealth changes hands.

Young professionals who, based on their education and career path, appear to be on the track to meeting minimum requirements may receive an exception. Commonly referred to as the emerging affluent, they can prove valuable clients for the private bank and wealth management firms in the future.

Should You Become a Private Banking Client?

The concierge nature of private banking is one of the factors that makes it such an attractive product. However, that’s not all it has to offer. Private bankers offer a one-stop-shop for all of your banking needs. That said, here are some of the benefits you can expect with private banking.

1. Dedicated Representative

The main perk of private banking is that you are assigned a dedicated representative, or a team of people, whose job is t understand your circumstances and cater to your financial needs. The representative makes it easier to initiate wire transfers, deposit checks, and more.

You will never have to worry about waiting on hold to talk to the next available representative. Because your dedicated manager has intimate knowledge about your financial situation, you won’t have to repeat your preferences every time you need something at the bank.

2. High Investment Returns

Banking institutions allocate the best-performing staff to the private banking division to manage the finances of high-net-worth individuals. The result is higher investment returns for the clients.

The average rate of returns from private banking investments is 7% to 13%. Sometimes that rate goes as high as 30%. The extensive resources offered by private banking allow clients access to investment vehicles like high-performance hedge funds. You also get expert advice on investment options with high rates of returns.

3. Access to a Network of Specialists

Your dedicated manager has got you covered and will connect you to the right specialists. They will connect you to the best tax attorney, estate advisor, investment analyst, or any other specialist you need. The ability to have your private banker set up meetings with these specialists can be a time-saving perk for you.

For many private banks and wealth management firms, having a comprehensive and multi-disciplinary team of professionals with expertise in different financial areas is the key to business success. It allows them to provide the best wealth advisory services, which is key when dealing with high-net-worth clients.

4. Perks and Discounts

Every private bank offers some perks for their clients as a reward for the large volume of business they bring. Services like estate management, tax preparation, wealth management & investment advice, and corporate checking will be offered at a discount.

The foreign exchange rates are attractive for clients involved in the export and import business. Those involved in real estate will benefit from fast-tracked transaction processing through lead advisors. You will get access to lines of credit at lower interest rates than regular clients.

If opening a savings account, the bank may give you a higher annual percentage yield. From time to time, private banks host exclusive events so that they can interact with their high-net-worth clients. And even with the ongoing pandemic, there are still virtual opportunities like virtual wine tasting to connect.

5. One-Stop-Shop

In addition to discounted products, private banking clients get everything consolidated under one roof. You get enhanced services from a dedicated manager, who acts as the liaison with different departments within the bank. This ensures that you only get the best without having to knock on every door.

6. Privacy

Customer dealings and transactions offered to high-net-worth individuals such as private banking are anonymous. You will have access to proprietary products, and the dealings will be confidential to prevent competitors from selling similar products to the same people.

A culture of privacy is important to the wealthy as publicizing personal information could compromise their business interests. It helps protect them in case of lawsuits involving their investments. For most, keeping personal information private provides a sense of security.

7. Business Benefits

If you are a business owner, a relationship with a private bank can help your business grow faster. You can open your business and personal account with the same private bank, and enjoy lending opportunities and other benefits.

Moving funds from one account to the other will be hassle-free. Not to mention, you get to enjoy promos and discounts offered to regular clients.

Enjoy the Best of Private Banking

If you’re searching online for “private banks near me”, the guide above will help you choose the best private bank for you. Private banking makes it easy for high-net-worth individuals to manage their financial affairs in one place. It’s something to consider if you have over $500,000 investable assets and need the convenience of a bank concierge.

Contact us today!

The Ultimate Guide to Investment Banking

The global investment banking industry has skyrocketed over the past few decades. And it is only estimated to grow higher each year. From a whopping $102.84 billion in 2020 to $11.45 in 2021, this lucrative business has tremendous growth potential.

But you may be wondering – what is investment banking exactly? What do investment bankers do, and how does the process work?

We’ve got you covered. In this guide, we walk you through everything you need to know about investment banking. 

What Is Investment Banking?

Investment banking is a division of a financial institution that serves corporations, governments, and other institutions. Investment banks are essentially the bridge between investors and corporations.

They help facilitate communication and achieve established financial objectives.

Investment banks carry out the following services:

Underwriting

Underwriting is the raising of capital or funds to support a particular organization. It is typically provided when a company wants to go public or launch its IPO.

Investment banks help companies do this by selling stocks and bonds to investors. This, in turn, benefits businesses because they have the capital needed for day-to-day business operation and growth.

Mergers and Acquisitions

Investment bankers offer advice and consulting for the M&A process as well. They typically aid in the process from start to finish.

What does M&A involve, you may ask. It is a process whereby corporations find and complete buying over another business.

The investment bank here will negotiate the best deal for the client. They will also use their contacts and networks to find growth opportunities.

Thus, investment banking represents both the buyer and the seller in an M&A deal.

Sales and Trading

In this sector, investment bankers act as dealers for the client. They help procure and seal trades to further the organization’s net capital. 

This process can involve matching up various buyers and sellers.

What Do Investment Bankers Do

Investment bankers are financial advisors to corporations, businesses, and governments. Their success is tied to the success of the capital market. Thus, if the economy is doing well, more money will go towards investment bankers and their clients.

They also have a central role in launching IPOs or initial public offerings. They help with closing mergers and acquisitions, managing final company transfers and sales, and issues stocks and bonds.

Skills Required for Investment Banking

Investment banking jobs are high-stress and come with a lot of prerequisites. Following are some essential skills needed to succeed in the trade.

Financing

Every investment banker has to deal with arranging financing. The companies that banks represent will need funding for projects.

Whether it is building a new office or constructing a highway, the chances are that the corporation has used the services of investment bankers.

The bond will get priced appropriately, documented, and then published to become available for buyers.

Negotiation

M&A is a high-pressure situation that is liable to sudden change. Investment bankers need to be able to keep their cool and manage negotiations with ease through it all.

Negotiations can be lengthy with an ongoing series of offers and counteroffers. Thus, bankers are good at practicing fairness and mediation to ensure both parties get a good deal. There is also a fair deal of relationship management involved in the negotiations.

Financial Modeling

On an everyday basis, professionals in this field carry out financial modeling activities. This includes 3 statement models, discounted cash flow models, and more. 

The process involves skills in analysis and research. Bankers need to anticipate future trends and outcomes into present workings as well. The best investment banks carry out a vast range of data analysis practices to provide better value to clients.

Investment Banking Process

The main aim of the process is to raise money. Below is a step-by-step explanation of how the process works, from start to finish.

Selecting the investment banker: Companies will find the right professional for their needs. They evaluate the individuals based on risk, size of funds, strategy, and more.

Brainstorming: The banker shares their insight on the amount to be raised, securities, and more. They also decide on the strategy and offering price.

Underwriting: The underwriting agreement is carried out.

Selling group: All the members of the underwriting syndicate and other parties form a group. They will manage the distribution of assets and determine how they can reach future investors.

Pricing: This is a sensitive issue. A low price can increase interested parties, but it dilutes earnings. A higher price may be a deterrent for investors, but it keeps the profits more solid.

Distribution: The security is distributed to individual investors. This can be done through the form of stocks, bonds, or more.

Stabilizing: Now that the company has distributed its security, it is time to stabilize it. It should arrive at a consistent price by maintaining a firm position in the market. It should also consistently bring in capital for the issuing organization.

Investment Banking Is an Exciting and Fast-Growing Industry

Investment banking plays a vital role in our economy. Whether it is the Wall Street appeal or just interest in the high profile and compensation for the profession, this career is famous for its high growth potential.

We hope this article provided insight into the exciting investment banking field.

Are you interested in learning more about business, finance, and economics? CFI.co (Capital Finance International) is the resource for you! With news, analysis, and commentary on worldwide markets, we have everything you need to stay informed and updated.

Click here to browse through our Finance articles!

PayPal Accounts for Nearly Half of All Digital Wallet Complaints in the US, Almost 4,500 in the Last Four Years

Over the last four years, consumer complaints about digital wallets and mobile payment apps in the United States surged as more and more Americans choose cashless payments.

PayPal Accounts for Nearly Half of All Digital Wallet Complaints in the US, Almost 4,500 in the Last Four Years

Between April 2017 and April 2021, the US Consumer Financial Protection Bureau received nearly 9,300 complaints related to mobile or digital wallets, and the majority of them aimed at one platform.

According to data presented by StockApps.com, PayPal accounts for nearly half of all digital wallet complaints in the United States, almost 4,500 in the last four years.

PayPal Received 2x More Complaints than Square and Coinbase Combined

As one of the first and most significant players in the digital payments landscape, PayPal witnessed impressive growth since the pandemic struck. More than 67 million people started using its services in the last year alone, with the total number of users rising to nearly 400 million.

Unsurprisingly, given its wide user base, PayPal had the most complaints of all companies providing digital payment services in the United States. Between April 2017 and April 2021, PayPal received 4,431 digital wallet complaints, or two times more than Square and Coinbase combined, revealed the US Public Interest Research Group data. Furthermore, statistics showed most of them were related to managing, opening or closing a mobile wallet account.

Square came second with over 1,200 complaints in this period, with unauthorized transactions as the top issue.

The digital wallet service for buying cryptos, Coinbase, ranked third with a total of 755 complaints related to digital wallets or nearly six times less than PayPal. PNC and JPMorgan Chase &Co. round the top five list with 594 and 324 received complaints, respectively.

Total Number of Digital Wallet Complaints Surged by 5,200 in a Year

Although the number of digital wallet complaints has been constantly growing since 2017, the last year set a new record.

Statistics indicate that between April 2017 and April 2021, the US Consumer Financial Protection Bureau received a total of 9,277 complaints related to mobile or digital wallets. More than 1,000 complaints were received in the first year. However, in the year preceding April 2021, the number of complaints surged to 5,200 or nearly 60% of all complaints received in this period.

Statistics also revealed there were 970 complaints in April 2021 alone, nearly double the previous complaint peak in July 2020.

The global shift towards a cashless society and the surge in the use of mobile wallets are expected to continue driving the rising number of complaints. In 2021, mobile wallets are set to become a $2.5trn worth industry, growing by a massive 25% year-on-year. Nearly 20% of the total transaction value or $468.1bn will be generated in the United States.

The full story can be read here: https://stockapps.com/blog/2021/07/27/paypal-accounts-for-nearly-half-of-all-digital-wallet-complaints-in-the-us-almost-4500-in-the-last-four-years/

Top 8 Factors to Consider When Selecting Financial Advisors

Need a hand with setting financial goals? If so, if you’re really not alone, especially since there are almost $90 trillion of international assets under management right now. Not sure how to find an expert with financial advising experience? To tell you the truth, finding the right professional to help you handle your finances requires knowing your options. Take a look at a few factors to consider when selecting financial advisors below!

1. The Suitability Standard 

If you’re looking for a financial advisor who will put your needs first, consider this. Financial advisory firms that meet the suitability standard address and disclose any “conflict of interest” they may have when representing you. On the bright side, most financial advisory firms will put this down in writing for future reference.

Besides this, it’s also essential to think about whether or not your firm is an RIA, or Registered Investment Advisor. That’s because they are held to a higher standard as well!

2. Upfront and Clear Fees

Let’s be honest. No one wants to work with a financial advisor who isn’t clear about their fees. That being said, figuring out the total cost of getting your portfolio together can be a difficult and confusing task.

On the other hand, finding a financial advisor you can trust means that they will be more than happy to break down all of their fees for you.

This can include everything from:

  • Hourly financial planning fees
  • Fees for managing your portfolio
  • Other hidden fees

Once you’ve made sure that all of your financial fees are as transparent as possible, you should be good to go.

3. Accurate Performance Reports 

Now that we’ve got that covered, it’s also essential that your financial advisor of choice provides accurate performance reports. That’s because user-friendly transaction and holdings reports are the keys to managing your portfolio successfully.

To get started, you must decide whether you like to receive your reports on a:

  • Monthly basis
  • Quarterly basis
  • Semi-annual basis

We highly recommend that the more you review your financial portfolio, the better!

4. A Simple Investment Process

When you’ve found the right financial advisor for you, the next step is to ask them what their process for investments is. For instance, they may let you know which investment vehicles are products that will work in your favour.

In addition to this, your financial advisor should also let you know whether not you need to make any changes to your existing investment portfolio. Besides this, they may also ask you about your primary contact information.

In exchange, we encourage you to ask your financial advisor about their professional credentials and experience as well.

5. An Independent Custodian 

Additionally, you should ask your financial advisor if they use independent custodians like:

  • Charles Schwab
  • Fidelity
  • TD Ameritrade

In case you didn’t know, independent custodians are great for providing additional asset reviews and records aside from your financial advisor. They’re also helpful in protecting your account from any fraudulent activity! 

6. Honest Offerings and Services

You should also clearly understand the level of service that your financial advisor will offer. For instance, email and ask them if financial planning is included in their initial package. Also, find out what kind of financial planning software they use and whether or not you will have access to it. Believe it or not, this can potentially make or break your deal as well.

To get the ball rolling, here are a few more questions that you should ask your financial advisor:

  • Do they schedule weekly, monthly, quarterly meetings?
  • How long will it take to hear back from them?
  • Do they provide investment offerings for beginners?

Once you learn more about the financial services that you are looking for, picking the best financial advisor for you should be a piece of cake.

7. Events and Education 

Another important thing to consider is whether your financial advisor provides any educational events. This is particularly helpful if you’re interested in learning and understanding your overall financial portfolio.

To get started, be sure to ask your financial advisory firm if they will take the time to answer any questions you may have during your regularly scheduled meetings. Also, you can ask them if they will continue to educate you on your financial portfolio as time goes on. Finally, covering complex topics such as asset management is vital to your success as well.

8. Life Transitions

Last but not least, do your best to choose a financial advisor who puts your life transitions as their top priority. This can include common event such as:

  • Getting married
  • Having children
  • Getting divorced
  • Losing loved ones

Ask your financial advisor if they have any experience dealing with customers who are going through difficult life changes. 

If so, what did they do to help them? As long as you feel comfortable opening up to your advisor, you should be in a good position to put your finances in their hands!

Why Hire a Financial Advisor?

Sometimes, going through a major life event is enough to make you want to rethink your personal finances. Typically, this type of event will include some sort of major gain or loss of money.

So that’s why it’s important to seek a financial advisor if you are:

  • Close to retirement age
  • Receiving an inheritance
  • Getting married soon
  • Going through a divorce
  • Lost a partner
  • Helping your parents with their finances
  • Unsure of how investing works
  • Looking for a “second opinion”

Now that we’ve got that covered, choose your advisor wisely!

Selecting Financial Advisors Is Simple 

Having a hard time finding the perfect financial advisor for you?

Here’s the thing: When it comes to selecting financial advisors, the process shouldn’t be complicated. Fortunately for you, we are here to help.

From comparing advisor fees to reading references and reviews, we’ve got everything you need to succeed. If you’re finally ready to talk to your advisor, don’t forget to read our handy guide first!

Looking for my financial and banking help?

If yes, don’t hesitate to read more of our blog right away.

Make Smart Investing Choices With These UK Stock Market Tips

It’s been a tumultuous year for the UK stock market to say the least. Between Brexit and the Covid-19 pandemic, March led to some record-breaking highs and lows in the FTSE 100 due to global uncertainty. While some stock exchanges have recovered significantly, the UK stock exchange remains burdened. But it’s not all doom and gloom. There are still many ways to make smart and safe investments on the London stock exchange in 2021. We’ve put together our best stock market tips to help you know how to invest with confidence.

Knowledge is Power

We’ll start with a note for newcomers, although it could also serve as a reminder for the veterans of the exchange. Due to all the hype and chaos around the potential GME short squeeze, many new investors entered the market this year. 

This is great news that more people feel empowered to invest, but it’s so important that investors have the knowledge they need to invest well.

By this, we don’t mean knowing everything there is to know about each stock and where it will go. Nobody knows this and anyone who says they do is kidding themselves. What we mean is you need to understand the terminology and mechanics of the UK stock market. 

Know your terminology and particularly synonyms for all the different buzzwords. Know which companies pay dividends. Know your different market indices.

One of the most important things to understand and accept is that past performance does not guide future returns. While analysing previous share performance and market performance can give us great insight, that’s all. They don’t guarantee the future of the market or a certain stock.

The LSE Is Unique

The London Stock Exchange (LSE) is one of the largest stock exchanges in the world, with a market value of more than £2 trillion. It’s one of the oldest exchanges in the world and comes with unique benefits and risks.

We’ll start with the good news. Because of its age and stature, the LSE is a financial hub. It’s an advanced financial market.

This makes the securities market both very liquid and stable for investors. For those looking to exchange outside the New York Stock Exchange, the LSE is one of the best options.

It’s also home to some of the largest blue chip companies such as GlaxoSmithKline, Unilever and AstraZeneca. This comes with security, so investing in the LSE comes with less risk than other financial markets worldwide. 

It’s not all good news though. The political risks of Britain are unique. While the entire world has been affected by the Covid-19 pandemic, only the UK has the additional risk of Brexit.

Though we’ve left and absorbed the initial hit and consequences, economic uncertainty remains. Not least, as Scotland and N.I polls both continue to show voters wish to leave the UK and rejoin the EU. 

Politics aside, the UK economy is a service economy. This is common for developed countries and in good times can mean more stability. But in more volatile times, commodity prices and consumer credit changes can cause problems fast. 

Much like our first point, understanding the unique risks and benefits of the LSE allows you to make safer and smarter investments long-term. 

UK Stock Market Tips

This uncertainty sounds like bad news, but it isn’t that simple. For those who already invested and faced the market crash of 2020, it seems that for now, the storm is over. For those looking to invest, it’s a bargain.

Though the market has recovered a lot throughout 2020 and into the first quarter of 2021, share prices are low. Barring another global catastrophe, they’re unlikely to be this low again for a while. It’s an excellent opportunity to invest.

This is particularly true for industries worst hit by the pandemic. Share prices in the hospitality sector remain low despite government support. With the end in sight thanks to the vaccine rollout, as well as substantial support to get to the finish line, this could be a great investment as normality returns to the UK.

Stocks that have risen throughout the pandemic may also remain a good long-term investment as consumer habits change. Online businesses such as Ocado have enjoyed strong growth for obvious reasons throughout 2020.

But research suggests the new norm will remain in some aspects. 40% of UK consumers surveyed said they would continue to spend online post-pandemic.

While this is good news for online businesses, it adds additional uncertainty to an already suffering high street. This means staple stocks that were once a safe investment remain troubled into 2021.

The best investing tips we can offer are the ones that could apply to investing on any stock exchange: plan, diversify and remain calm.

Plan

Planning for the unknown can seem impossible because it is. By plan, we mean understand the risks and rewards and plan for uncertainty. 

You cannot control how your investments perform, it’s the nature of the game. But you can control how you prepare your investment portfolio to prepare for market changes.

Planning can help you understand how long you’re prepared to invest for, what your objectives are and how your assets are spread. In a volatile market, this can help keep you sane and know when to sell.

Diversify Your Portfolio

In other words, don’t put all your eggs in one basket.

It can be tempting when you read analysis after analysis about some definite market changes. But it’s never definite and as Reddit has proven, experts come in all shapes and sizes.

This isn’t to say don’t invest when the opportunity arises but spread your investments. Over the long-term, variety and patience almost always pays far more than short-term gains. 

Diversifying your portfolio should be part of your planning. Researching company operations, competition and the wider industry will help you create a smart portfolio that will perform well throughout market changes. 

Keep Calm and Carry On

If the last year has taught investors anything, it’s that nobody can predict the market. So remain calm.

The best investors know not to react rashly to emotion. If you spend your day keeping an eye on scoreboards it will lead to overreactions to short-term changes.

The ups and downs are all normal, so ride them out and focus on your own plans. Planning and diversification can help you avoid panic selling as you know your strategies and long-term goals.

More Financial Information

The best UK stock market tips are the age-old advice applicable for any stock market. Understand your market, plan well and diversify your portfolio. For further research, our blog offers great insight into the UK stock exchange, as well as global exchanges, so make sure to check it out.

6 Common Online Banking Mistakes and How to Avoid Them

In recent years, online banking has continued to grow as banks offer more and more online and mobile banking services. In fact, 73% of banking customers use online banking at least once a month. Similarly, 59% use mobile banking at least once a month. 

With this rapid rise in popularity comes some concerns for bank account holders. Luckily, it is easy to avoid the most common online banking mistakes. We’ll take a look at what to keep an eye on and how you can make online banking a breeze.

1. Login Safety Mistakes

One of the most common banking mistakes is not having adequate safety measures set for online banking services. You should never use auto-login features. This can make it too easy for someone else to access your account. 

Instead, use a password or biometrics login on your phone. If possible, you should also use two-factor authentication to ensure additional safety. 

It’s also important to choose a unique username and password, one that you do not use anywhere else. Your bank may be taking strict online security measures but other websites you use may not. 

If a hacker finds out your password on another website and then learns that you have used it in multiple places, they could have easy access to everything, including your bank account. For similar reasons, you should also change your password regularly, so if a security breach does occur your account is not at risk for long.

Speaking of passwords, it is imperative that your bank account password is very strong. Use a mixture of uppercase and lowercase letters, symbols, and numbers. Make sure it’s not easy to guess either.

2. Unsecure Online Access

How you access your online bank account is also important. This is particularly true if you plan on accessing your online bank in public or through a device you don’t own. 

Don’t bank on public wi-fi if you can avoid it. You also shouldn’t use public computers. Even if you log out completely, hackers can still record keystrokes to gain access to your accounts.

When using your bank’s website, make sure the web address includes “https://”. The “s” is important as it indicates that there are extra security features protecting you.

If you want to download your bank’s app, make sure it is the official one. Download it via iTunes or Google Play. You may even be able to download it through your bank’s website. Either way, make sure your phone is also protected with a strong password too.

3. Not Checking Banking Activity

Another common online banking mistake is not frequently checking your online banking activity. If fraudulent activity occurs, it’s important to catch it early so you can talk to your bank and rectify any issues. 

But in order to do that, you need to actively be aware of what is going on within your account. Online and mobile banking make it easy to view your recent activity. Simply look through your transactions once a month to make sure everything is how it should be. 

If you notice anything is off, you should then immediately get in touch with your bank. Doing this does not take a lot of time and could prevent you from having to deal with much larger problems down the road. 

Additional online banking services can make staying on top of your account even easier. Many banks allow you to enrol in email, text, or push alerts that are triggered by certain activities. These could include unusual activity, balance thresholds, or transactions meeting certain criteria. 

These options are usually available in your profile or through the security features section of the website. Signing up for these options lets you know about problems with your account between times when you check on it. This can help you keep an eye out for anything unusual.

4. Handling Mobile Deposited Checks

Being able to remotely deposit checks can save you a lot of time. But, it’s important that you handle mobile check deposits correctly.

Instead of throwing the check away as soon as you deposit it, keep it for two weeks. It takes a few days for the check to clear. If there is a problem reading the check, you’ll have proof of the correct amount. Afterwards, be sure to shred the check, instead of only throwing it in the trash.

5. Mistakes When Making Online Payments

Online payments make it easy to send money to others and pay bills. But, you need to be very careful when doing these actions.

If you are scheduling a payment, make sure the date is correct. Sending it too late could cause late fees if it’s a bill. Also double-check the amount you enter. Even a slight change in decimal can make a huge difference.

Finally, be sure you follow through with the payment. Online banking portals may have multiple steps. Follow through and make sure you end up with a confirmation page or email. Otherwise, you could owe late fees for your bills if the payment isn’t fully completed.

6. Sending and Receiving Money 

If you send money to another person or account, be sure to double-check their details very carefully. If the details are wrong, you could send the money to a different person or business. This is very difficult to correct as the other person would need to approve returning the money.

If you expect to receive money from someone else, also make sure the details you give them are correct. Otherwise, you may not receive the money you are expecting. This can be difficult to fix too if the person accidentally sends it to someone else.

Avoid Online Banking Mistakes

Online banking is an important part of modern financial management. This is why avoiding common online banking mistakes is so important. Taking these measures can save time, money, and a lot of potential heartache. 

Subscribe to the CFI.co magazine to learn even more ways to improve your finances.

7 Invaluable Benefits of a Financial Planner

If you are serious about managing your money and accumulating wealth, the benefits of a financial planner can take all the stress and burden away from doing it yourself.

Sure, you could feel competent at investing and money management, but do you really have the time to go in-depth? 

Yet, opting to work with a financial planner won’t suit everyone. There are pros and cons when using a financial planner or adviser, but we do think the benefits we’re going to discuss are well worth considering.

So let’s check out seven benefits of a financial planner.

1. Full-Time Professionalism

The first and obvious benefit of choosing to work with a financial planner is that they are full-time professionals, making investment decisions day in day out.

They will have a wealth of knowledge and plenty of tips about where to invest money. Plus, they can prove to you with past clients the sort of returns they achieve. 

With all their training and know-how, it would be hard to compete with what they are capable of in terms of investing and managing your money wisely year on year. 

Keep in mind, however, just because someone is a qualified and experienced financial adviser, it still doesn’t give you any solid guarantees that you won’t lose money. Going with a financial adviser is always a risk.

But typically, a financial planner will run you through different investment options with varying calculations of risk attached to them. Ultimately, you will be the decision-maker in the process. Your financial planner just handles the more technical aspects of your investments, as well as offering tips and advice.

2. Tax Advice

When anyone invests their money and makes capital gains on their wealth, tax is always an issue. In some cases, taxes can destroy the point of investing as they can simply erode away your gains to a pittance.

A financial planner should be experienced enough to know how to navigate the tax realm in your favor. They will tend to let you know various options you can choose to help reduce your tax burden, and they’ll be up-to-date on new regulations and changes in the law.

3. Objectivity

One key benefit of a financial planner is that they are likely to be a lot more objective than yourself when investing your money. 

This benefit is strongly linked to the professionalism of a financial planner. They are just doing their job investing your money – they don’t have emotional attachments as you may have. 

When emotions get in the way of investing, you’re treading on a pathway to ruin. Objectivity is essential to make wise investment decisions, and a financial planner will give you that.

They can either consult with you about investment decisions they’d like to take for you and explain them clearly.

4. Partnership

A financial planner doesn’t just get the keys to your car to drive off alone into the sunset. They will be available to discuss things with you and keep you updated on what’s going on with your hard-earned cash.

A financial planner is someone you can collaborate with, they’ll listen to you, and they’ll try their best to understand your wants and needs.

As well, the communication aspect of your partnership can be extremely beneficial. By speaking out ideas and strategies allowed, they can become more obviously viable, or conversely, something to avoid.

Plus, there are plenty of tips out there that will help you monitor your financial adviser. 

5. Proactivity

This benefit is linked in a sense to the points of objectivity and professionalism.

A financial planner will be poised and ready to anticipate almost every eventuality that could happen in the markets and with your money. They don’t let their emotions get the better of them, which is easier for them since they are trained professionals.

They will also seek out new investment ideas that you might be aware of and get you tied up in some lucrative opportunities ahead of the curve.

Furthermore, they can implement any ideas that you may have with speed, which you might not be capable of doing yourself.

6. Organization

For many of us with busy schedules and limited time, managing the flow, saving, and investment of our money can become overwhelming.

It may be that you’re losing money that can be easily kept if your finances and payments are restructured in a more organized and logical manner. 

Having control over your finances can relieve a lot of stress, and it could even be the case that you save more money by actually paying for the services of a financial planner. 

It’s funny how they don’t properly teach us the ins and outs of taking care of money and investing at school. Now you have the opportunity to see your financial planner, not only as a money manager but a teacher of investing and finance too. 

7. Relaxation and Free Time

Wouldn’t it be amazing to have all your financial worries set aside and dealt with by someone you can trust?

Most of us have enough on our plates already with work, family, and other commitments. Choosing a financial planner’s expertise will surely give you the peace of mind you deserve and some much-needed relaxation. 

The Benefits of a Financial Planner

We’ve just mentioned only seven benefits of a financial planner. There are loads more benefits to take advantage of if you decide to take the leap and regain control of your finances.

It will be like starting off on a new journey into the unknown at first, but once you get your bearings and develop a rapport with your financial planner, we think you’ll be surprised at the positive changes that will occur.

Please check out our blog for more financial advice and wisdom.