Wealth Management Archives - Page 3 of 4

The total net assets of mutual funds worldwide were over $14 trillion in March of this year.

Mutual funds are a hugely popular investment vehicle globally. However, there are a huge number of them out there, with the quality of returns varying significantly from one to the next.

For a newcomer to the world of investment, it can be difficult to know what to look for in a mutual fund. The best performing mutual funds in the past may not continue to post exceptional returns in the future, especially in these uncertain economic times.

Read on as we take a closer look at mutual funds, and what to look for when investing in one.

What Is a Mutual Fund?

A mutual fund is a type of investment fund. A team of professional investment managers take capital from a large number of investors and invest the resulting pool of money in various securities.

Essentially, it is a means of investing in capital markets indirectly. Rather than picking stocks or bonds and putting money into them yourself, you allow a mutual fund manager to make the choices for you.

The advantage of this is that your investments are made by a highly experienced investment professional. This is safer than picking investments yourself, especially if you’re new to the world of investment.

The Different Types of Mutual Fund

There are many different mutual fund types. You can categorize them on the basis of the types of securities they invest in, the way they are managed, and the level of risk they take on in seeking returns.

To pick the best mutual fund for your needs, you need to know what your investment objectives are. These will dictate the type of fund you should pick.

Index Funds

Index funds are so named because they track the performance of a given index. Common indexes that form the basis for these funds include the S&P 500, the Dow Jones Industrial Average (DJIA), and the Nasdaq Composite (IXIC).

Index funds are an example of a passively managed fund. No input is required from investment managers, as the fund simply tracks an index.

Passively managed funds typically have much lower fees than actively managed funds for this reason. As outlined below, many investors who want a passively managed fund opt for an ETF rather than a mutual fund.

Stock Funds

Stock funds invest in a range of different stocks. Unlike index funds, fund managers actively pick these stocks individually and will chop and change them based on market trends.

Stock funds are therefore an example of an actively managed fund. Their fees are higher than some alternatives.

Stocks are riskier securities than bonds or other fixed-income securities. The risk of loss with a stock fund is therefore relatively high, but the opportunity for gain is greater as well.

Investment approaches vary widely from one stock fund to the next. Some managers will make more of an effort than others to diversify their holdings and hedge risks.

Specialty Funds

Specialty funds can be thought of as occupying a kind of middle ground between stock funds and index funds. Investment managers pick the stocks themselves, but within certain boundaries.

These boundaries typically relate to a market type. For instance, a cannabis market specialty fund will only invest in cannabis stocks.

Fixed Income Funds

Fixed income funds invest in low-risk securities. These include Treasury notes and bonds, as well as highly-rated corporate bonds.

These mutual funds cater to investors who prioritize income over growth.

If you’re simply trying to manage your money better with a view to long-term savings, a fixed-income fund might be just the thing for you.

Mutual Funds vs Other Fund Types

There are other types of investment fund that you may have heard about. While these can bear similarities to mutual funds, there are important distinctions to be drawn in each case.

Exchange-Traded Funds (ETFs)

The ETF is a close cousin of the mutual fund. Both types of fund take payments from investors and use these to invest in a variety of different securities.

ETFs tend to focus more on passive strategies than active ones. Many ETFs track indexes.

Mutual funds also tend to have more complex structures and a greater variety of share classes.

Hedge Funds

Hedge funds are another type of pooled investment fund. However, there are a number of important differences to be aware of with hedge funds.

Hedge funds use a number of complicated strategies to extract higher returns from their investments. These include high-frequency trading and short selling.

Hedge funds typically charge much higher fees than mutual funds.

Because of their complex, risky strategies, hedge funds are generally only available to professional investors, or those with a large number of investable assets.

What Sets the Best Performing Mutual Funds Apart?

There are certain mutual funds that regularly outperform their competition. While it is impossible to say exactly what the winning formula is for these, there are certain things that profitable funds have in common.

The first thing you should look for is a low expense ratio. A better approach to cost management means lower costs for you, and also indicates fiscal prudence on the part of the fund managers.

For actively managed funds, quality management is the key consideration. Look for managers with a proven track record of providing results.

Putting Your Money to Work

Mutual funds are a diverse family of investment vehicles. Some are designed to seek huge gains, while others simply aim to provide steady growth for clients looking to retirement.

The best performing mutual funds have consistent objectives that they stick to. The best investors do exactly the same thing.

When you’re deciding on your next mutual fund investment, start with a clear goal in mind.

If you’d like to learn more about the work we do or the topics we cover, contact us today.

Investment Management

How a Financial Consultant Can Help You

ByCFI.co

For most people, money is one of the primary driving forces in their lives. After all, you need it in order to buy food, shelter, clothes, and all other goods and services.

Money causes stress while also providing a sense of security. Much of your time and effort are invested in your career to provide a certain standard of living for your family and to prepare for retirement.

A skilled financial consultant can help you reduce debt and make the most of your money. This article takes a look at the reasons why you should consider working with an advisor to prepare for the future.

They Help You Understand Your Goals

Believe it or not, many people have no idea what they really want. Even though the average life expectancy is around 73 years, few people approach the future with any sort of goals in mind.

A lot of the population lives paycheck to paycheck, without much rhyme or reason to their financial decision-making.

A chartered financial planner will ask a series of questions designed to encourage you to think about the future so that you can plan accordingly. This will enable you to be conscious of the financial decisions you make going forward rather than simply winging it as you have in the past.

They Help You Develop a Plan

Once you’ve figured out some of your long-term goals, you’ll be able to develop a plan for how to actually reach those goals.

A good plan provides structure, enabling you to create a step by step roadmap that can be adjusted year after year as your wealth grows and your goals shift and change.

Advisors are skilled at building a financial investing plan. This will be specifically tailored to meet your needs. The more specific you can be about what you want out of life, the more they can help.

They Show You the Best Ways to Invest

There are many ways to invest your money. Each type of investment tool offers different degrees of risk and reward. The key is to understand how aggressive you want to be in building wealth.

This requires working closely with your advisor.

Be open and honest. This will provide valuable information that will help them know how best to proceed. It’ll also help them find the most efficient resources and tools to utilize when managing your wealth.

Keep in mind that an experienced financial advisor will explain all the investment options that are available, along with the pros and cons that come with each.

Don’t feel pressured to invest too aggressively, but also listen closely to their advice. Try to be as open as possible to educated advice regarding ways to maximize your investment funds.

They Help Avoid Stupid Investments

It’s important to remember that your financial advisor is an expert. Investing is a complicated business, with an incredible amount of data to track and variables to consider.

Because of this, it can be easy to make a mistake, to chase a trend that’s leading to a dead-end, or to find yourself excited about an investment opportunity that will only end up costing you money and causing frustration and pain.

An experienced advisor will help you avoid as many mistakes as possible. They have the training and skills needed to identify bad trends and unreliable sectors in the marketplace.

It can be hard to trust someone with your money. Especially when you feel like you’ve discovered a great investment opportunity. Yet, trust is exactly what will be required in order to build the level of wealth that most people only dream of.

They Provide a Sounding Board

A good advisor will also be a great listener. This might not sound like a big deal, but it’s actually one of the most important qualities to look for when seeking an investment professional.

You should never feel hesitant to talk to your consultant like a real person. Tell them your hopes and feelings. Mention ideas you’ve been thinking about, and never feel stupid for asking tons of questions.

Remember, they work for you. They are there to answer questions, provide feedback, and help give you confidence that your future is on the right track.

They Help Enforce Financial Discipline

Saving money isn’t fun. It can be a huge challenge.

After all, it’s much more exciting to spend money on shiny new toys rather than sock cash away for the future.

This is another reason why an experienced consultant is so valuable. They will help you keep your eyes on the prize because they won’t have any emotional attachment to your finances. This means they can approach making smart investments and building your wealth from a purely educated and logical vantage point.

They Help You Connect With Other Professionals

Your financial advisor will also connect you to a good lawyer and accountant. This will help ensure that your money matters are legal, and keep any potential tax issues from arising.

They Help You Relax

Finally, knowing that you have an experienced consultant on your team will help you relax. You have a pro working for you, after all.

They’ll choose investments that will make your money work for you, and grow your wealth day after day. You can rest assured knowing that when you’re ready to retire, you’ll have the resources to enjoy your golden years to the fullest.

A Guide to the Benefits of Hiring a Financial Consultant

Planning for retirement can be confusing. Fortunately, hiring a skilled financial consultant will help make the process a little less stressful.

Click here to learn how to form an investing strategy for European markets.

Investment Management

The Best Place to Invest 100K: Understanding UK Savings Accounts

ByCFI.co

If you have £100,000 or more in savings, keeping in safe is essential.

The risk-free, common-sense option to keep your money safe is to put into a savings account. Not only will your money be held safely, but it will also accrue interest.

But, are your savings working well for you? Are you getting the maximum amount of interest possible?

How well do you understand UK savings accounts?

We’ll explore the different savings options and the best place to invest 100k.

How to Find the Best Place to Invest 100k

There are several factors to consider before finding the best place to invest £100k.

Decide how long you would like to lock your cash away. The longer you leave your money, the more interest you will accrue.

Fixed-rate savings accounts that require you to hold your money in place over a certain amount of time can provide good returns. However, if you need your money back before then, you may not be able to access it.

Are you a pensioner or a student? Banks and building societies often offer preferential interest rates for different age groups. In which case, you should look for the best saving rates for pensioners or the best savings account for students.

You should also consider that you may need to split your money between multiple accounts.

Decide on whether you need access to your cash. Do you require online banking?

Is customer service important? Will you need to service your account in your local branch?

Work out what’s important to you, and make sure that you find an account that ticks all of the relevant boxes.

Don’t Put All of Your Eggs in One Basket

By spreading your investments across a range of different savings accounts, you will enjoy a variety of benefits.

If you have short-term requirements on some of your cash, put that money into an easy-access account with the best interest rates. For the rest of your cash, look for longer-term savings accounts that offer the best returns.

Similarly, if you are unsure about what you want to do with your money, keep it in easy-access savings accounts until you have decided. That way, you can still move your money out when you have a long term plan.

Financial Services Compensation Scheme

When you invest any money into a UK bank or building society account, you are protected. The Financial Services Compensation Scheme protects savings of up to £85,000, or £170,000 if it is a joint account.

If you are looking to place your £100,000 or more into any type of savings account, you will need to set up at least two different accounts with different banks to protect your money.

Alternatively, if you can set up a joint account, you will benefit from the higher level of protection.

The Financial Services Compensation Scheme is in place to protect your money in the event of the bank or building society being able to pay you your own money.

Making Use of ISAs

Savings accounts in the UK are subject to tax-deductions on interest payments.

Individual Savings Accounts (ISAs) offer the opportunity to save up to £20,000 each year, tax-free. If you have a partner, you could both invest £20,000 each in your own ISAs.

If you want to make the most of your savings, then you should take advantage of your tax-free savings allowance by opening an ISA.

You could opt for Cash ISA or stocks and shares ISA or a combination of both.

A cash ISA will act in much the same way as a savings account. With a stocks and shares ISA, your money is invested into stocks, corporate, and government bonds. You may return a greater degree of interest with this type of ISA; however, you may lose money too.

Finding the Right Savings Accounts

Find a savings account that offers you a rate of interest that is higher than the rate of inflation.

Inflation rates directly affect the value of your savings. If you place your money into an account with a 2% interest rate, then after one year, you will have 2% more money.

However, if the rate of inflation is greater than 2%, you will have more money, but that money will have lower purchase power than it did a year before.

Regular Savers

Regular savers accounts often offer interest rates that are higher than the rate of inflation.

With rates of up to 5% available, this type of savings account is certainly worth exploring.

You will need to be aware of maximum deposit limits, as well as the length of time that the rates will be valid.

Fixed-Rate Savings Accounts

Fixed-rate savings accounts will offer you the same rate of interest over a specified period of time. Typically, your money will be locked into the account for between one and five years.

The longer you are willing to leave your money in this type of account, the higher the interest returns will be.

Don’t Overlook Current Accounts

It is easy to think that a current account is just for holding your cash and paying your direct debits; however, they can be a useful tool for depositing large sums of money.

Many current accounts will offer a reasonably high rate of interest.

Usually, current accounts will offer a higher rate of interest for a small amount, and then a lower rate for any money thereafter.

For example, a current account may offer 5% on the first £2,500 for one year, and then 1% on everything above that amount.

Always Research the Best Deals

The best place to invest 100k will depend on the interest rates offered by banks and building societies. Banking products change, so shop around and find the best savings account that will work for your money.

For more advice and information about making your money work for you, explore the other articles on the blog.

Wealth Management

Core principles to boost up your profit factors

ByCFI.co Blogger

While trading, every trader uses a unique trading strategies to navigate in the Forex market. Strategies are used by traders to help them to trade in a profitable way. You need to understand the fact that not all the strategies will work for every trader. A simple trend trading strategy can help you to secure profit, but still, you might not be able to make a decent profit after a few months. The market is always changing its nature and it’s your duty to keep pace with this dynamic market.

The market allows a trader to work as per their skills and strategies. If you have good and effective skills and strategies you will be able to make profits but if you have a lack of skills and strategies then you will find it difficult to make profit. Although there are some important principles that are common in the entire market for all traders to achieve their goals.

Pay attention to the indicators

It’s important for all traders to understand what is happening and what might happen in the market. Through the analysis of Forex indicators, you can understand the market better. Indicators play a crucial role in the market, so all traders should learn their uses. When you learn the use of the indicators, open a demo account with Rakuten so that you don’t have to lose too much money.

You can find out the economic situation of the market’s currency by using the indicators. The indicators also help traders to identify the best time for entry and exit in a profitable way. If you can identify the best times then it will maximize your profits by reducing your losses.

Keep a personal trading record

Many traders fail to keep accurate and faithful trading records and thus can’t identify their previous mistakes or rectify them. Trading records can enhance a trader’s entire trading system, as it allows you to trade by thinking twice to find out whether you will make profit or not. Once you develop the habit of keeping the record, you can execute quality trades in the fx trading account. Most importantly, you will start building up confidence which is the most crucial component of trading.

You can make better strategies and skills in your trades by keeping trading records. A trading record acts as a guideline for traders as it helps them to rectify their previous mistakes and to trade with better strategies in the next move.

Embrace the risk management

If you want to become a successful trader, you should never avoid risk management in your trades. Risk management is essential for all the traders as they can lower the percentage of losses in the trades by setting proper risk management. Never break the rules of risk management as it can blow up the trading account. Stick to the safe method so that you can earn big amount of money. Analyze the losing orders and learn from your mistakes. Once you become good at trading, start placing trades with confidence.

You should never risk more than 2% of your trading capital and never change your risk management out of greed. Many new traders set higher risk management in their trades and thus end up losing their capital. It is also known that proper risk management is a savior for traders as it reduces the percentage of losses.

Conclusion

You can have your own rules for trading in the Forex market but don’t ever avoid the principle trading methods. The above points will help you to trade in a profitable way, you also need to pay attention to all the terms and conditions of the market. The entire trading system may become easier for you if you learn and understand the market more precisely. Mastering the Forex market is a never-ending learning process.

Business

Workers’ Comp Benefits and the Going and Coming Rule

ByCFI.co Blogger

Traveling for work is a complex issue when it comes to your eligibility for workers’ compensation. The general rule is that workers’ compensation doesn’t cover your commute to and from work.

Does Workers’ Comp Cover Travel for Business?

Yes, workers’ comp covers travel for business. When you’re traveling because of your work, you can claim workers’ compensation in the event of an injury. The workers’ compensation system operates the same way whether you’re actively on the job or traveling for your employer.

Personal errands during work travel are not covered; however, the travel itself and incidental activities like the hotel and meals still fall under the workers’ compensation system. Workers’ compensation covers travel for business except for strictly personal activities during the trip.

Does Workers’ Comp Cover Travel to and From Work?

Workers’ comp does not cover travel to and from work. However, there may be situations when you are traveling related to work that are actually covered. Travel to and from work is generally not included. Still, if you are running errands for your employer or on a work-related travel assignment, you may actually be classified as working.

It depends on whether you’re serving the interests of your employer during the travel. Although the general rule is that workers’ comp does not include travel to and from work, there may be situations where your traveling counts as being on the job.

Workers’ Compensation and Travel

The purpose of workers’ compensation is to provide employees easy access to financial compensation when they’re hurt at work. The general rule is that you can claim workers’ compensation for work-related injuries. If you’re on the job and you get hurt, you can access the workers’ compensation system to pay for your medical bills and provide replacement income.

However, workers’ compensation doesn’t cover the risks of daily life. For that reason, the employee’s personal commute doesn’t fall under the workers’ compensation system. If you get hurt going to or from work, you have to look to your own car insurance or personal insurance to pay your expenses. You may also bring a third-party claim for financial compensation, but the person or entity that caused your injury is responsible for your damages, not your employer.

Traveling for Work

However, even if you’re traveling at the time of your injury, you’re not necessarily out of the workers’ compensation system. You may be traveling for work and not realize it. When you’re traveling on company business, you’re still covered by workers’ compensation.

Even things that are incidental to the travel itself, like staying at a hotel or eating meals while away from home, can classify you as working for the purposes of workers’ compensation. It’s essential to evaluate the entire circumstances present when the accident occurs.

Buma vs. Providence Corp. Development – Nevada Supreme Court

In the Buma v. Providence Corp. Development case, the Nevada Supreme Court recently clarified the rules when it comes to what counts as work-related travel. Nevada Revised Statutes 616C.150(1) states that a person must show their injury arises out of the course of employment. The court said that a person might be in the course of their employment even if they’re not directly on the route of travel at the time of the injury.

In the Buma v. Providence Corp. case, the victim was the vice president of sales for his company. He worked from home and made his own travel arrangements. The victim traveled out of state for a conference. He stayed at a ranch with a friend and affiliate of the company. Together, the two prepared joint presentations to give on behalf of the company. The victim died while riding an ATV on the ranch.

The third-party workers’ comp insurer, and the lower court, denied the victim’s family workers’ compensation benefits. They said that the accident did not arise out of work duties. However, the Nevada Supreme Court vacated the lower court’s decision.

When Does an Injury Arise out of the Course of Employment for Workers’ Compensation Purposes?

The Nevada Supreme Court said that an injury arises out of the scope of employment when there is a causal connection between the victim’s injury and the nature of the employee’s duties. Under Nevada Revised Statutes 616B.612(3), all travel that an employee gets paid for is part of the course of employment.

However, even if part of the travel isn’t compensated hourly, it may still be work-related travel. Generally, workers’ compensation covers business trips. It covers the actual business part of the trip, but it also includes staying in hotels, sleeping, eating, and other navigation that has to happen for the trip.

Does the “Coming and Going” Workers’ Compensation Rule Apply During Business Travel?

In the Buma case, the lower court applied the “going and coming” rule. The rule prohibits compensation for injuries that occur during the commute. The Supreme Court explained that the employer is not liable for the daily dangers of the employee; however, the commuting rule isn’t applicable when a person travels for work. Under Nevada law 616B.612(3), traveling employees are covered, including acts that are incidental to traveling.

The court said that work travel doesn’t cover social and recreational activities that a traveling employee chooses to pursue. These are things that occur for strictly personal amusement. To be a personal activity, the employee must show an intent to abandon the job temporarily. It’s a very fact-dependent question that depends on the unique situation in each case.

Conclusion

The workers’ compensation commuting rule is complicated. There are times that work travel is covered, and you are eligible for benefits. Sometimes it can be a difficult question of whether you’re traveling for business. The Las Vegas workers’ compensation attorneys at Adam S. Kutner, Attorney at Law explain travel, and the 2019 Nevada Supreme Court case of Buma vs. Providence Corp. Development.

The best way to know if you qualify for workers’ compensation is by getting a personal review of your claim by a qualified and experienced attorney.

Investment Management

How to Form an Investing Strategy For European Markets

ByCFI.co

Europe is a global economic nexus, an incredibly stable and developed market.

Its heart is EU, which operates as a single market of 28 different states and 500 million customers. Technology and innovation are driving forces behind slow but steady growth.

This upward trajectory instils confidence when it comes to investment prospects. Many lucrative opportunities are just a few clicks away. You can pursue them without running into risks that emerging markets are rife with.

Alas, launching an international investment endeavour is a daunting task. You have to do your homework and tailor the investing strategy to specifics of the landscape.

Here is a guide on how to establish a strong foothold and enhance your portfolio.

Doing the Spadework

The European market is a mature, diverse, and liquid ecosystem.

The investment risk is low, save in times of crisis. Europe is also a highly dynamic and competitive investment arena, home to leading companies of today.

Yes, it’s easily one of the most inviting investing destinations. However, succeeding is easier said than done. To maximise your chances, you have to show due diligence.

Start by running a proper market analysis and scour the continent to discover where the best opportunities are. Evaluate your risk tolerance and put a risk management strategy in place. Two main weapons for chipping away at risk are market knowledge and portfolio diversification.

We would implore you to pay special attention to the currency risk. We’re talking about fluctuations in the foreign exchange market. They can be a double-edged sword, spurring both unexpected losses and profits.

Once research tasks are sorted out, set your chief objectives. Do you want to go for foreign direct investment (FDI) or portfolio investment? Is your goal to have a small portion of shares, source raw materials or control a whole company?

Get your priorities straight before moving to the next stage.

The Main Pathways to Investment Glory

One of the easiest ways to gain exposure is thru exchange-traded funds (ETFs).

The three main options are:

Broad European ETFs
Regional European ETFs
Country-Specific European ETFs

They offer simple means of portfolio diversification, unlike the US, which is a predominantly stock-based market. It’s possible to invest in hundreds of different companies, as well as specific industries/countries. At the same time, you can avoid the steep fees associated with mutual funds.

Familiarity is another benefit you can score. Europe harbours some of the most renowned names in modern business.

There is also an alternative approach, which is two-fold. The first tactic is buying American Depository Receipts (ADRs). The second one is acquiring stocks via foreign stock brokers.

The drawback is you have to worry about legal and tax issues. You also face hurdles such as translating foreign languages and currencies. On top of that, it can be tricky to conduct in-depth research on foreign stocks.

Note that ADRs are free of these risks. Unfortunately, they are limited to large foreign corporations that boast liquidity in spades.

The Million Dollar Question of Where

It makes a lot of sense to examine investing opportunities thru regional lenses.

Eastern Europe is an interesting region due to the potential for rapid growth. Investors comfortable with higher risks head there chasing hefty profit margins.

On the other hand, one enters Western European markets for reasons other than explosive growth. Namely, those who favour a climate with low volatility should feel at home here.

Germany is probably a must-consider, as the largest economy of Europe. It houses many of the top-500 publically traded companies in the world. County’s biggest companies (by market capitalisation) are available via the DAX 30 index, which is similar to the Dow Jones index in the US.

In terms of other, small economies, there are certain rules of thumb. You want to pay close attention to conditions like domestic policies and international agreements. These are the main tools countries employ in order to attract foreign investment.

Apart from that, it’s a good idea to stick to predictable and transparent markets. EU member states have an advantage in this regard. Common institutions handle and synchronise investment rules, including areas like dispute resolution.

The Old-School Way

Beyond that, you should feel free to invest in asset classes such as property.

The yields tend to be higher than in the case of bonds. This trend persists across different regions and states. What is more, the returns are often adjusted up for inflation.

This is to say real estate investment can act as a blanket insulating you from monetary risk. Besides, the spectrum of possibilities is very wide. You can aim for steady cash flow or speculative profit.

One piece of advice is to keep an eye on hot local markets such as Amsterdam. There, a combination of limited supply, demographic influx, and scarce land inflates prices year after year.

Finally, we shouldn’t overlook the commodities.

This traditional asset class involves minerals, fossil fuels, ores, crops, and trees. Propelled by global economic growth, the consumption and demand remain stable, while supply is finite.

Again, one of the main benefits is protection against inflation. Of course, commodities also come with risks such as price volatility. Just take the example of gold, which has been on a rollercoaster in recent years.

The lesson to draw is clear: be ever vigilant and be advised.

Investing Strategy for Europe: Taking Portfolio to the Next Level

The world’s largest regional economy is a Promised Land for many investors.

However, that doesn’t mean profits are just there for the taking. You need to put together a smart investing strategy before anything else. Rely on facts and figures to make it as sound as the Euro.

Likewise, make sure to assess your risk tolerance and financial appetites. Pick your region and industry sector accordingly. Identify up-and-coming companies and business champions with a bright future.

You can hardly go wrong fuelling your investments via European ETFs.

Just stay quick on your feet and steer away from pitfalls in the shifting monetary dimension. Keep up the pace with changing regulations and standards. Following these steps, you should be able to make headways into burgeoning European markets.

Don’t hesitate to contact us with any lingering questions and dilemmas. It’s time to elevate and diversify your portfolio.

Economics

Boris Johnson must release the potential of property post-Brexit

ByCFI.co Blogger

The past few months have seen a huge amount of political change. In December 2019, for example, the Conservative Party won their largest Parliamentary majority since 1987, while January of this year featured the passing of the EU Withdrawal Bill through parliament. With the recent cabinet reshuffle, and Sajid Javid’s resignation as Chancellor, February has also proven to be an eventful month.

Boris Johnson must release the potential of property post-Brexit — **CEO and co-founder of FJP Investment:** Jamie Johnson

However, in the period since the election, there has been a growing sense that we have returned to some semblance of normality. The three years after the referendum were turbulent and hostile, with nail-biting parliamentary votes and overheated political discourse becoming par for the course. With no election likely until the middle of this decade, and with the Government in a relatively strong position, this stress is seeming to subside. Whatever your political disposition, this is no doubt a good thing for businesses and investors.

Data suggests that the UK stock market grew by an impressive £33 billion in the immediate aftermath of the general election. The effects of the so-called Boris bounce have likely been overstated, but it has hasn’t been as short-lived as some had predicted. Property also saw an uptick; according to Zoopla’s UK Cities Price Index, demand for UK property rose at the fastest rate since 2017. Similarly, according to Nationwide, prices in January were at a 14-month high. This is especially good news in light of modest house price growth in recent years as a result of Brexit uncertainty.

Looking forward, then, the property market could be set for renewed growth.

What can the Government do to propel the property market forward?

As mentioned, following through on their Brexit promises is crucial. Whether you voted remain or leave, 2019’s missed deadlines created profound uncertainty amongst business leaders. Therefore, it’s not just about the completion of the process, but also about making sure negotiations go smoothly and businesses are being made aware of the progress made.

The EU Withdrawal Bill passing through parliament was an important first step. Indeed, it showed that this majority has allowed Boris Johnson to get on with Brexit in a way his predecessors found difficult. But the Government’s ability to tick all the other boxes during the transition period is unproven. There is still a long way to go in terms of reassuring the property market that Brexit is in safe hands and that investing can continue without concern.

Furthermore, the Government must also deliver on its previously stated aims for policy in the property space. The domestic market, for example, is supportive of a new stamp duty surcharge on international buyers of UK property — an approach the Conservative Party has previously supported. According to a recent poll conducted by FJP Investment, as many as 70% of UK property investors are in favour of such a move.

There are also other areas that the Government should follow through on to help realise the full potential of UK property. Fighting the housing crisis, for example, will require coordinated policy to encourage construction, investment, and stakeholder engagement. On that last point, the Conservative Party has previously suggested consulting local people on the design of new-build developments. Doing so would hugely increase the attractiveness of such developments, so it’s little wonder that 68% of investors surveyed by FJP Investment supported the policy.

The Government must also commit the necessary resources to construction if it is to tackle the central challenge to UK property: insufficient supply. More homes being built will almost certainly bring prices down and make rents more affordable, but a national building revolution, of sorts, may be required.

A recent promise of £100 billion for construction over the next five years is a step in the right direction, while Boris Johnson’s promise of a million new homes over the same period shows ambition for UK property. But governments of all stripes have set, and missed, huge housebuilding aims, and property leaders are tired of empty promises. Now is the time for investment and reform to fulfil that huge target.

Looking forward, UK property appears to be in a strong position. With so much latent demand, and with prices rising, 2020 is likely to be more positive than last year. Further, with Brexit likely to be completed, the entire market may be set for an upturn. However, this can only happen with the right government support and policy implementation — indeed, without it, the housing crisis will not be resolved. Thankfully, the Government’s aims broadly align with property investors’, meaning they likely have the right priorities to help property return to form.

Jamie Johnson is the CEO and co-founder of FJP Investment

Hedge Funds

Coronavirus: investors should avoid knee-jerk reactions

ByCFI.co Blogger

Coronavirus is the number one threat to financial markets currently – but most investors should avoid knee-jerk reactions, affirms the CEO of one of the world’s largest independent financial advisory organizations.

Nigel Green, deVere Group chief executive and founder, is speaking out as global stock markets are rattled on fears of the potentially deadly Sars-like virus triggering major sell-offs.

The death toll has now risen to 81 and almost 3,000 people have been confirmed as infected, with 44 cases having been detected outside China, where it originated.

On Monday, the composite European Stoxx 600 fell 1.7% at the open, London’s FTSE 100 dropped 1.6%, while Germany’s Dax was 1.7% lower. The slump followed a similarly dramatic decline in Asia overnight. The Shanghai Composite fell 2.7%, the Hong Kong Hang Seng lost 1.1%, and Japan’s Nikkei dropped 2%.

Mr Green says: “The Coronavirus is the number one threat to financial markets currently as global investors are becoming jittery on the uncertainty.

“But whilst this health crisis will inevitably hit some sectors, such as travel and retail, most investors who have a properly diversified portfolio should avoid knee-jerk reactions. History teaches us that most issues of this kind have a short-term impact on stock markets.”

He continues: “Most investors should monitor the situation with their financial adviser and sit tight at present. But if it is still escalating next week, with much higher casualty rates, a more defensive approach might be necessary.

“However, the cost and effort of making such a switch means you do not do it lightly, and more evidence is needed that the virus does pose a medium to long term risk to China and the global economy.”

Mr Green goes on to say: “But that said, this should serve as a wake-up call to all investors to ensure their portfolio is well-diversified across asset classes, regions, sectors, even currencies.

“This is the best way to mitigate risks and the best way to be well-placed to take advantage of the opportunities when they occur.”

The deVere CEO concludes: “Stock markets tend to bottom with the peak in new cases during a public health issue of this kind, before rebounding.

Nigel Green, deVere Group chief executive and founder, is speaking out as global stock markets are rattled on fears of the potentially deadly Sars-like virus triggering major sell-offs.

The death toll has now risen to 81 and almost 3,000 people have been confirmed as infected, with 44 cases having been detected outside China, where it originated.

Mr Green says: “The Coronavirus is the number one threat to financial markets currently as global investors are becoming jittery on the uncertainty.

Mr Green goes on to say: “But that said, this should serve as a wake-up call to all investors to ensure their portfolio is well-diversified across asset classes, regions, sectors, even currencies.

“This is the best way to mitigate risks and the best way to be well-placed to take advantage of the opportunities when they occur.”

The deVere CEO concludes: “Stock markets tend to bottom with the peak in new cases during a public health issue of this kind, before rebounding.

“This is a worrying and serious situation and investors must be vigilant. They should remain properly diversified and remain in the market.”

Asset Management

How to Get Ahead Financially: 7 Tips for Success

ByCFI.co

If you’re living paycheck to paycheck and can’t get ahead, you’re in the company of 78% of workers.

It’s frustrating to constantly feel like you’re playing financial catch-up. The stress of being short on money or not being able to reach your financial goals can make you want to give up.

But taking small financial steps in the right direction gets the ball rolling. Those actions eventually help you gain traction and improve your financial standing.

Instead of ignoring your financial situation or accepting your money problems, put these seven tips into action.

1. Start With a Budget

Taking charge of your financial situation requires a plan. That comes in the form of a budget.

You need to know your exact income, expenses, and spending habits to make better use of your money.

Budgeting apps can help you, but you can also create your own simple budget on paper or using a spreadsheet program.

Start by adding up all the money that comes in each month. That could include wages from your job, child support, interest, and other investments.

Next, write down each individual bill or recurring expense you have. This includes things such as utilities, insurance, car payments, loans, and credit card payments.

Subtract those expenses from your income to see what you have left. This is the amount you can divide up between the rest of your expenses, such as groceries, clothing, and dining out.

Once you have your budget set, you need to follow up and make sure you stick to your spending limits. If you spend twice as much as you allocate for eating out, it’ll throw off the rest of the budget.

Monitoring your spending compared to your budget can help you spot the trouble areas. You might notice you go overboard on clothing every month. Look at those areas to see how you can control your spending better.

You may need to adjust some categories while you figure out your budget. You might spend less in some areas than the amount you allocated, so you can lower those limits while raising others.

2. Set Up Multiple Bank Accounts

Do you use a single account for everything? Having multiple bank accounts can help you better manage your money.

If you have trouble sticking to your budget, consider creating different bank accounts for individual areas of your budget. You might have one for your mortgage and other loans, another for other recurring expenses, and a third for your discretionary spending.

When you pay your bills, you know you’ll have the necessary money in those accounts. Pulling from one account for your discretionary spending gives you a hard limit on those expenses.

If you have all of your money lumped into one account, it’s easier to overspend on extras. You convince yourself that you can splurge on that leather jacket, but you end up using money that should go to the mortgage or your credit card payments. That can cause you to fall behind financially.

3. Create Financial Goals

Why do you want to get your finances under control? Setting specific goals can keep you motivated to handle your money better. You know cutting back on spending or increasing your savings is for something you really want.

Think in terms of short-term and long-term financial goals.

Short-term goals can keep you motivated because you can reach them quickly. They’re also building blocks for your larger goals and can help you gradually improve your finances. This could be things such as building an emergency cash fund, cutting your expenses by a set amount or paying off one credit card.

The long-term goals help you improve your financial standing over time. They’re the bigger goals that keep you going and get you to the place you want to be. Examples include paying off all debt, saving for a house, or reaching a larger number in your savings account.

If you’re not sure where to focus your attention, a financial planner can help. A financial pro can look at your current situation and make recommendations for short-term and long-term financial goals.

4. Pay Off Debt

In the UK, the average debt is £15,385. Deciding whether or not to go into debt is a personal decision, but carrying high levels of debt makes it difficult to get ahead financially. The interest and fees you pay eat up money that could go toward your financial goals.

Plan to pay off your debt as quickly as possible, especially if it’s holding you back financially. Put extra money toward your debt to get rid of it faster.

5. Create a Savings Plan

No matter how financially behind you feel, setting aside money in your savings account is a smart decision. Set up your bank account to transfer money to savings automatically on your paydays. That way you ensure you set aside the money before you spend it on other things.

Include retirement savings in your plan. Starting now helps you build your retirement savings faster, so you’re financially stable when you reach retirement age.

6. Increase Your Income

Having more money in your bank account gives you more financial stability and helps you reach your goals. You can either make more money or cut your spending to increase your usable income.

Asking for a raise at your current job or looking for a new job can help you increase your income. Another option is a temporary part-time job or side gig for extra money. Think of it as a temporary sacrifice of your time to accelerate your financial goals.

7. Change Your Mindset

Many people think of cutting back on spending or saving more as a negative thing. It feels restrictive, so you don’t want to do it.

Flip how you think about financial changes. Focus on what you get from the changes instead of what you’re losing.

When you’re tempted to make an impulse buy, as yourself if the item will get you closer to your financial goals. Having meaningful goals and keeping them in your mind can help you change your thinking.

How to Get Ahead Financially

When you’re struggling with money, it can be difficult to figure out how to get ahead financially. Confronting your situation directly and tackling it a little at a time helps you improve your finances. Visit our archives for more financial information.

Wealth Management

Prepare Them For The Future: 5 Unique Ways To Teach Kids About Money

ByCFI.co

Did you know that 62% of parents give their kids an allowance?

But it’s not enough to just hand your kids money. You need to teach them the value of a dollar and how to spend it.

Teaching kids about money doesn’t have to be hard. Money is one of the greatest stressors for adults. But if you can teach your kids early how to budget, you can save them a lot of heartache later on.

This article will give you 5 ways to teach your kids about money.

1. Match Allowance to Chores

Don’t start giving your children money until they’re old enough to do chores.

If you give your child an allowance when they’re very young for doing nothing, they’ll question why they have to work for their money later on.

When your child is old enough to do housework, be sure to match the money you give to the work they do.

For instance, offer a certain amount for each chose. Vacuuming could be one dollar, washing the dishes could be two dollars.

It’s important to break down the value of each piece of work they do. This will teach them how labor gets exchanged for money.

Make a chore chart so they know what they’re in charge of each day. Set a “payday” on Fridays so they have money to spend over the weekend.

This traditional work schedule will get them used to waiting for their money and spending it wisely. If they don’t do their chores, don’t cave and give them the allowance anyway. This isn’t how money works in the real world and you’ll be sending them the wrong message about hard work.

2. Make Them Pitch In

There is no way your seven-year-old can pay for every toy they want.

But this doesn’t mean they can’t pitch in a portion. When your child asks for a major game or toy, always make them pay for a small portion.

Even if it only takes them saving their allowance for two weeks, this simple act will make them value the toy more.

if you constantly give your child toys without them having to do any work, they won’t appreciate them. The toys will become something they’re entitled to rather than something they had to work for.

3. Talk About What You’re Buying

Your kids are always listening to you.

They hear you talk to your spouse about big purchases coming up. Next time you buy something large, include your child in the conversation.

Explain to them how long it took you to save up for that item. This way, when a brand new minican arrives in your garage, your child doesn’t think it got there by magic. They will start to understand that all those days you go off to work, you were earning the minivan.

Talk about how long it will take to pay off the minivan if you haven’t already.

When you go to an ATM, tell your child how much money you’re taking out. Don’t make the process of withdrawing money look easy.

4. Cook More Meals

Eating out every night and buying your child food from the drive-thru sets the wrong precedent.

It teaches your child that food comes easily and that it’s accessible when you want it. Your child will have no framework for how much it really costs to feed themselves.

Instead, focus on cooking the meals you put on the dinner table.

Take your child to the grocery store with you and get the ingredients to make the food he or she loves to eat a restaurant.

For instance, if her favorite restaurant food is a burger and fries, then go to the store and buy those ingredients. Add up how much each ingredient costs together and compare that number with how much you would have spent at the restaurant.

You’ll notice that getting food in the grocery store is far less expensive- and your child will too.

Then take the ingredients home and cook together. This will teach your child the importance of working for the food they ear.

5. Use a Clear Piggy Bank

As an adult, you know what to look for in a bank, but your child doesn’t

Sure, traditional piggy banks are cute. But they’re also impossible to see in without opening them.

You want your child to store their money in a clear receptacle so that they can see how much is in there.

This will help them understand the process of earning and saving money. They can visually see how much further they have until their goal.

A good practice is to teach them to wait until the piggy bank is full before spending the money. Maybe offer them a couple of bonus dollars if they keep the money in the piggy bank long enough. Think of this as teaching them how interest works.

So Now You Know The Importance of Teaching Kids About Money

Remember, teaching kids about money is crucial to their success later on.

High school courses don’t often cover important topics like how to spend money, and once your kid is in college it will be too late.

You want them to be smart about earning money early so they don’t make mistakes later on.

On the flip side, remember that your child is still a child. Don’t overstress them about money issues that you’re having. It’s important they know how the world works, but they shouldn’t be so worried about finances that they can’t sleep at night. They’ll have the rest of their lives to worry.

Wondering the best adult bank to save your money? Check out our advice here.