Saturday, 30 June 2018

Weekend reading: Does the passive label put people off index funds?

Weekend reading logo

What caught my eye this week.

I remember the first time I heard the phrase ‘passive investing’ uttered by The Accumulator.

Or at least I think I do – I’m pretty sure I dozed off midway through the sentence.

I disliked the passive investing label from the start. Several years and hundreds of articles later, it still sounds a bit defeatist.

Words matter. As Preston McSwain recalls in an article I link to below:

[Investment expert] Charles Ellis was once asked: “What is the biggest risk investors face when investing in index funds?”

His answer?

“Being called passive.”

Yes, regardless of your investment background, deep down you are likely to be more attracted to an investment or firm that sounds dynamic and vibrant versus one that sounds docile and inert.

I can relate to that, for my sins. In contrast, ‘index investing’ I can easily get behind. Indexing sounds faintly clever and technical. Comfortingly nerdy.

It was also how I began investing nearly 20 years ago, and it was the reason I counted myself fortunate in snaring The Accumulator to write for Monevator a few years back.

I believed a portfolio of index funds was the best approach for most everyday investors, and still do. But given I was increasingly off in the weeds nurdling with my active investing, it was crucial to get somebody on board who was passionate about them.

And passionate my new co-blogger was – as passionate as any stock picker I’d ever met. He was deeply excited about expense ratios and the merits of rebalancing quarterly versus annually and whatnot. Things that mattered, in other words, rather than things which sounded good.

Which is probably why he wasn’t so phased by the weedy sounding ‘passive’ investing label. He gets his excitement elsewhere, as he’s written many times.

So passive investing – a term The Accumulator had picked up in his copious US reading – came with him to this site, and we even named our dedicated subsection accordingly.

But I’m made of weaker stuff, and I never loved it.

Others seem to increasingly feel the same way. Some have more sensible reasons, too.

As active costs fall, indexes proliferate, and supposedly passive investors shoehorn more esoteric ‘factor’ plays into their portfolios – rather than just tracking the global market – the lines are blurring.

Then you have all the hedge funds trading ETFs, which show up in some indexing statistics but are the antithesis of a passive approach. It’s all rather muddled.

I read several good articles and a podcast on this theme this week:

  • Who is passive? – Preston McSwain
  • Q&As on passive investing – Part 1 & Part 2 by Cullen Roche [He was early on this]
  • Indexing sheds passive clothing – ETF.com
  • The past, present, and future of ETFs [Excellent podcast, the short tax snippet is US-centric]Invest Like The Best

These posts may confuse new investors, who I feel should learn the basic terminology before challenging it.

But once you know why index funds tend to beat their active counterparts, and why a *cough* passive approach is likely to turn out better than a lot of active management such as market timing attempts or sector chasing, it’s interesting stuff to ponder.

It’s also something I’m thinking about as The Accumulator does seem to be approaching the end of the first draft of our infamous book.

Should we celebrate the passive investing label in our book title and pitch? Or avoid it, and perhaps sell more copies and reach more people?

News

Note: Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber.1

[News update: I’ve pulled The Telegraph as you now need a registered account to read even the free articles]

London property prices blamed for record exodus – Guardian

Surprise (modest) upgrade to UK GDP growth in first-quarter – BBC

Student loans: Use of RPI costs graduates up to £16,000 – Guardian

Retirement ‘wake up’ packs to be sent to help protect pension savers – MoneySavingExpert

Women have become much happier at work over the past decades. Men less so – The Economist

Products and services

Energy bills rise by £52 for 11 million households as 19 suppliers announce price hikes – ThisIsMoney

Mind the pensions gap: who’s at risk and what to do about it [Search result]FT

Virgin Money launches one-year savings account that pays you in Air Miles – ThisIsMoney

RateSetter will pay you £100 (and me a bonus) if you invest £1,000 for a year via my affiliate link. They now handle ISA transfers, incidentally – RateSetter

Gap narrows between two-and five-year mortgage fixes [Search result]FT

Is NS&I set to slash yet more deals? – ThisIsMoney

Emerging market passive investors to be put into Argentine and Saudi stocks [Search result]FT

Hotel booking sites could be forced to stop claiming ‘one room left’ – Guardian

Save thousands on university fees by studying in Germany, Sweden, Hong Kong and Australia – ThisIsMoney

Comment and opinion

Why UK house prices could stay flat for 20 years – UK Value Investor

A few snappy thoughts about money – Morgan Housel

Proof negative – Above the Market

High valuations still look the biggest risk to the US stock market… – Bloomberg

…but are they justified by soaring profits? – Calafia Beach Pundit

Brexit and investing: Panic early or not at all – Simple Living in Somerset

0% credit cards — more expensive than you think [Search result]FT

Five famous market gaffes – The Value Perspective

Twists and turns in the Tesla story – Musings on Markets

Power is the ability to control your own life – The Escape Artist

Brexit

Brexiteers calling Government’s own impact report ‘Project Fear on speed’Guardian

Brexit vote revisited – DIY Investor UK

There is no ‘Brexit dividend’ for motor industry, says head of motor industry trade body – Guardian

Will someone please put Danny Dyer in charge of the Brexit negotiations – NME

Kindle book bargains

Rivers of London by Ben Aaronovitch – £0.99 on Kindle

Eye of the storm: 25 years in action with the SAS by Peter Ratcliffe – £0.99 on Kindle

How To Be F*cking Awesome by Dan Meredith – £0.99 on Kindle

Off our beat

You see what you want to see – Of Dollars and Data

The secret to tackling workplace nerves – The Pool

One sentence with seven meanings unlocks a mystery of human speech – Wired

Cheap bacon: How shops and shoppers let down our pigs – The Guardian

Inside the minds of Elon Musk’s fans – The Verge

Rising seas: “Florida is about to be wiped off the map”The Guardian

And finally…

“One way to create an attractive risk/reward situation is to limit downside risk severely by investing in situations that have a large margin of safety. The upside, while still difficult to quantify, will usually take care of itself. In other words, look down, not up, when making your initial investment decision. If you don’t lose money, most of the remaining alternatives are good ones.”
– Joel Greenblatt, You Can Be A Stock Market Genius

Like these links? Subscribe to get them every Friday!

  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”.


from Monevator http://monevator.com/does-the-passive-label-put-people-off-index-funds/

Thursday, 28 June 2018

Martin Lewis: How to teach yourself scam self-defence…

Criminals aren’t always thugs with meaty arms and little between the ears. In our ever more interconnected world, these days many thieves wear suits, have charm, act in a sophisticated manner and make out they are on our side. 



from Martin Lewis' Blog https://blog.moneysavingexpert.com/2018/06/martin-lewis--how-to-teach-yourself-scam-self-defence-

Monday, 25 June 2018

Martin Lewis: How to teach yourself scam self-defence…

Criminals aren’t always thugs with meaty arms and little between the ears. In our ever more interconnected world, these days many thieves wear suits, have charm, act in a sophisticated manner and make out they are on our side. 



from Martin Lewis' Blog https://blog.moneysavingexpert.com/2018/06/martin-lewis--how-to-teach-yourself-scam-self-defence-/

Wednesday, 20 June 2018

Bartending or Waitressing: Which Is More Beneficial for Students?

If you’re a student in search of a job that will let you start earning an income quickly, chances are you’ve considered applying at a local restaurant. After all, establishments in the hospitality industry frequently hire younger workers and there are always positions opening up. When it comes to student-friendly jobs in the restaurant industry, two jobs in particular provide the opportunity for students to make a decent living in a sociable environment – bartending and waitressing. If you’re having trouble deciding which would be right for you, here’s a categorised comparison you can use to make a more informed decision.

Job Availability

At most restaurants, the server staff is much larger than the bartending staff, and in many restaurants, there are only 1-4 bartenders on the schedule at any given time. This means that you’re almost always going to find more openings in the server position than in the bartending position. For this reason, if you were to try to find temping jobs in London from StaffHeroes.co.uk or any other major job search site, you’d notice that bartender openings are generally much less common than waitress openings.

Ease of Getting Hired

The fact that there are less bartending jobs available makes the position more competitive, so you’ll have to have a better CV or interview than a lot of other candidates if you want to get hired. Furthermore, the skills involved in bartending are more complicated than those needed to be a waitress, as you’ll need to learn how to mix and handle an entire catalog of special drinks. Although waitresses will also need to memorise the menu and carry large trays, the degree of difficulty and expertise required to perform the job is still significantly higher for bartenders.

Potential Income

The average income of a waitress and a bartender can be very similar, but bartenders can make much more per shift if they’re working at a busy bar. However, if the bar is only busy on weekends or the bartender has to share tips with other bartenders, then they may wind up making less than the waitresses. Bartenders usually earn the most during the weekends, but on weekdays waitresses can earn more. Ultimately, bartending offers a higher maximum income, but waitressing provides more steady and stable earnings throughout the week at most restaurants.

Responsibilities

As a waitress, you’ll be responsible for more tasks than a bartender, but the level of responsibility is greater at the bar because alcohol is involved. Of course, the temptation to drink after work can become problematic for some students if it interferes with sleep and study time, so that’s certainly a factor to consider if you’re prone to drinking. Waitressing also carries a great deal of responsibility financially and in relation to the safety of restaurant patrons, as servers have to carry their own bank and deliver hot food to the table without spilling it on someone.

It Depends on Your Location and Personality

In the end, your decision should be based on the job openings available to you, your experience, and your personality type. Students who aren’t confident in their ability to resist peer pressure should avoid bartending positions because being in the centre of so much drinking fun can be quite tempting. On the other hand, if you’re prepared to take drink mixing classes and believe you have what it takes to get hired as a bartender, that may be the best option in terms of earning the highest possible income as a student working in the food industry.

Consider Other Restaurant Positions

In closing, if you’re unable to land a waitressing or bartending job, you may want to consider filling another entry-level role in the restaurant (i.e. – kitchen assistant or dishwasher) just to get your foot in the door before advancing to your desired position.



from Finance Girl http://www.financegirl.co.uk/bartending-or-waitressing-which-is-more-beneficial-for-students/

Monday, 18 June 2018

Increasing Use of Bridging Loans to Pay HMRC Tax Bills

What are bridging loans?

Bridging loans are a type of funding option which act to bridge the gap between the period a debt becomes due and the time when the main line credit source becomes available to be used to settle the debt. Bridging loans serve as a source of short term loan in times of urgent need.

Bridging loans have many advantages over other types of finance. It serves to provide the cheapest option for accessing short term loans in urgent situations. They are timely and easy to arrange and have an added advantage of having flexible lending criteria which allow the loans to be approved without long checking and inspection processes.

Bridging loans could be obtained for any kind of property. It is often the most available form of loan that could even be easily obtained by using property which other types of lending could find unsuitable as collateral.

HMRC tax bill

The HMRC, often written as HM Revenue and Customs (means Her Majesty’s Revenue and Customs), is a non-ministerial department of the United Kingdom government  whose purpose is to collect taxes, make state support payments, and foresee the administration of regulatory regimes such as the national minimum wage.

Failure to pay tax bills imposed by the HM Revenue and Customs (HMRC) is accompanied by grave consequences. Although the HMRC may sometimes grant payment extensions to enable individuals to have more time to obtain the needed capital to settle their tax bills, it is not often the case as these payment extensions are not always available.

The HMRC would demand for the immediate payment of an individual’s tax bills when they perceive that the individual might have the ability to make the payment immediately or when they are not convinced that the individual is in a position to get his tax bill payments up to date.

Bridging loans come in handy

Bridging loans are increasingly being used to pay off HMRC tax bills because they come in handy as a highly practical and serviceable lifeline in times of such pressing needs. They come with relatively low interest rates and provide the option of rolling up interest until the loan term comes to an end. It also provides the capability for finance to be obtained against the tied in equity with already owned properties.

Individuals who run their own businesses and find themselves currently unable to keep up with business finances, as a result of cash flow inadequacies and other unforeseen problems, and who are then suddenly faced with HMRC tax bills can find an easy way out from their current financial situation through securing bridging loans.  These loans provide business owners with the ability to buy the time the time they need to get back on their feet. Also, property developers who lack the capability to acquire the necessary capital to pay off HM Revenue and Customs tax demands often seek respite through sourcing bridging loans. Obtaining bridging loans is efficient and timely and therefore enables individuals to save their businesses from the impact of immediate HMRC demands.



from Finance Girl http://www.financegirl.co.uk/increasing-use-of-bridging-loans-to-pay-hmrc-tax-bills/

Friday, 15 June 2018

Weekend reading: Pervasive passive investing is becoming the reality of financial services

Weekend reading: Pervasive passive investing is becoming the reality of financial services post image

What caught my eye this week.

This website is 10-years old, and it’s amazing how much the financial landscape has changed in this time.

Was it really once exciting news when UK investors were offered an emerging market index fund? In 2010, when I wrote this post, yes. Before then you had to make do with active funds, investment trusts, or a handful of ETFs.

Today passive investing is increasingly the mainstream choice, and that is reshaping the financial industry.

Josh Brown from The Reformed Broker explained this week how this is already well advanced in the US:

The advisor clients are meeting with, in the modern era, is not promising them a way to “beat the market” or “discover hidden gems” on the Nasdaq.

Enlightened customers are not expecting their financial advisor, who works in an office complex off the side of the highway, or out of a storefront next to PF Chang’s, to be able to trade tech stocks for them and make world-trouncing macro calls in between handling required minimum distributions from their IRAs and mailing out birthday cards.

Enlightened advisors are focusing on the client’s needs and talking about what they can actually deliver – high quality, highly personalized ongoing advice and counseling.

The portfolio being proposed, and the proposal itself, are geared toward explaining why a specific allocation to a mix of asset classes is going to help the client reach their goals.

Of course the financial services industry is as slow to change as any other incumbent, which is why it puts out scare stories every few months about the risk of passive funds. Stories, which as Vanguard founder Jacke Bogle explains in this new interview below, often aren’t even based on reality let alone opinion:

It’s remarkable how much money Bogle must have saved investors over the decades – not just in terms of popularizing index funds but also how he structured Vanguard so it is effectively owned by its customers.

I sometimes wonder how much impact Monevator has made over the past ten years, based on feedback and traffic figures. Based on feedback and traffic figures, I think we’ve probably helped save investors several million pounds in fees by helping spread the news about passive investing.

But for Bogle, that figure must run to hundreds of billions of dollars.

Not a bad way to reflect back at your time in the office!

From Monevator

Life insurance and protection: A primer – Monevator

From the archive-ator: Why you must get out and stay out of debt – Monevator

News

Note: Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber.1

Equitable Life to shut down with surprise £1.8bn policyholder windfall – Guardian

Rich pensioners hoard cash and reject the urge to spend [Search result]FT

House price inflation could wipe out the benefit of stamp duty cut in 10 years – ThisIsMoney

Average-priced homes too pricey for average earners [Search result]FT

Fall in UK rail passenger numbers casts doubt on viability of franchises – Guardian

Snacks, slouching, and stagnant wages: How the office is making us miserable – Guardian

Was the Tether cryptocurrency used to ramp the Bitcoin bubble? [Search result]FT

Bank of England warns on 0% interest rate credit card offers [Search result]FT

How house price gains compare to shares, gold, and bonds – ThisIsMoney

Products and services

NS&I slashes its savings cap from £1m to £10k – ThisIsMoney

How good are Vanguard’s active funds? – The Evidence-based Investor

Vitality offers lower ISA and pension fees to customers who go to the gym – Telegraph

Ten things you should know about getting divorced [Search result]FT

Two active fund ‘World Cup’ portfolios [unsurprisingly] fail to beat the market – ThisIsMoney

Amazon’s Echo Show gadget currently costs £139.99 (it’s normally £200) and it can be yours in just two hours! – Amazon

Lifetime mortgages Vs retirement interest-only mortgages – Telegraph

How to save money keeping your car fueled – ThisIsMoney

Small energy firms are hiking prices, too, but there are still cheaper deals than the standard tariff – ThisIsMoney

‘Ethical grocer’ Farmdrop raises £10m to expand home delivery service – Guardian

Comment and opinion

Your risk tolerance is an illusion: Wait until you lose big money – Financial Samurai

Life is more than compounding money – Intelligent Fanatics

Stock market investors: How to think like a property investor – UK Value Investor

Why do investors focus on the wrong things? – Behavioural Economics

Why do stocks (i.e. shares) generally go up over time? – A Wealth of Common Sense

Compounding should be the goal for all investors – The Value Perspective

The best economics podcasts in 2018 – Tim Hartford

What computer chess suggests about investing – Morningstar

De-risking the human condition – Humble Dollar

Frugal motoring: The PCP black hole – The FIRE Shrink

How I live on less than $40,000 annually: Ralph from West Virginia – Len Penzo

Market-timing with multiples, momentum, and volatility [Research]Factor Research

Factors from scratch [Deep research, geeky!]OSAM

Kindle book bargains

Eye of the storm: 25 years in action with the SAS by Peter Ratcliffe – £0.99 on Kindle

How To Be F*cking Awesome by Dan Meredith – £0.99 on Kindle

Quiet Leadership: Winning Hearts, Minds and Matches by Carlo Ancelotti – £1.99 on Kindle

Off our beat

City of Spies: How the battle for Catalonia has divided Barcelona [Search result]FT

Jerry Seinfeld’s closed door – Cal Newport

Marcus, Casper, Oscar: Why start-ups are obsessed with human names – Bloomberg

And finally…

“In my view it’s possible to run a company both successfully and ethically. In fact, I’d go further. My own experiences in the business world suggest that an ethical approach, far from being a potential barrier to profits, is actually the secret to success.”
– Julian Richer, The Ethical Capitalist: How to Make Business Work Better for Society

Like these links? Subscribe to get them every Friday!

  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”.


from Monevator http://monevator.com/weekend-reading-pervasive-passive-investing-is-becoming-the-reality-of-financial-services/

Wednesday, 13 June 2018

Life insurance and protection: A primer (or why you should buy renewable term life cover, most of the time)

Photo of Mark Meldon, IFA

This guest post is by Mark Meldon, an independent financial advisor (and Monevator reader) who we’ve noticed talking a lot of sense over the years.

There remains a great deal of confusion about life insurance, so I thought I’d put together a guide to what life insurance is, who should consider purchasing it, the kinds of policies that are useful in the real world, how such policies are best purchased and set up, and when to review any cover you might have in place.

Too many people:

  • Have no life insurance when they should.
  • Have life insurance when they don’t need it.
  • Have the wrong kinds of policy and likely pay too much in premiums.
  • Have too much life insurance and waste money on unnecessary premiums.
  • Haven’t set policies up correctly.

It’s not actually terribly difficult to get matters right when considering life insurance, especially if you hire a suitably experienced independent financial adviser (IFA), or one of the on-line brokers like Lifesearch with whom I have no connection whatsoever, but who have an excellent reputation.

By using a combination of commonly available policies, you can minimise your costs and maintain flexibility and important long-term guarantees.

I believe:

  • You should buy the right kinds of insurance.
  • You should not waste money on insurance you don’t need.
  • You should take a responsible view on this matter and get on with it if there is a demonstrable need for insurance.
  • You should set up everything in the correct way and then file your papers in your bottom drawer, just taking a peek every now and again.
  • You should do your best to avoid making a claim by maintaining your health and keeping active.

Let’s get back to basics and have a think about this fascinating subject.

(Well, it’s fascinating to me, anyway.)

Life insurance and protection

Families purchase life insurance for protection; that is, they buy financial protection for themselves if the breadwinner – who brings in most or all of the household income – dies before the children have grown up.

Some families also buy financial protection for the years that follow the breadwinner’s retirement.

Even in the 21st century I find the father is usually the main breadwinner in most families, and so most of the life insurance purchased by a family is on the father. Of course, more and more families have two breadwinners, and the loss of income of either one could seriously affect the family’s financial security. Families with two breadwinners, therefore, may need to consider insuring both individuals.

Life insurance is based on the law of large numbers. Many families share the common risk of losing the breadwinner, and pay a small amount of money (called a premium) each year. In the event of the insured life dying during that year, the dependents/beneficiaries receive a much larger amount of money than the annual premiums that were paid.

A life insurance company uses mortality tables to calculate the risk of the insured dying during that year, collects premiums from all the persons sharing the risk, and handles the payment of the sum assured.

The type of financial protection a family needs varies with family income, resources, goals, composition, and stage in the family life cycle.

Used unwisely, life insurance can be an excessive drain on family finances and, indirectly, on family happiness and satisfaction.

Incidentally, many employers set up group life insurance schemes for their employees. This usually costs the members nothing and can be very helpful should disaster strike. I have a group life insurance plan for my small firm and the cost (tax deductible) is very modest. Do check if such a plan is available to you.

Types and uses of life insurance policies

Today, life insurance can be purchased in three basic types – term, whole of life, and endowment. The latter is quite rarely arranged nowadays, but I still come across policies of the so-called low-cost variety which were often arranged alongside interest-only mortgages up until 15 years or so ago.

There are many different names for policies, such as family income benefit, mortgage protection, gift inter-vivos, ‘flexible life’, and so on. They are all just combinations or variations of the three basic types of policy mentioned above.

Term

A term insurance policy protects the policyholder’s beneficiaries so long as the policyholder dies within the ‘term’, or period of time, specified in the policy.

Protection expires at the end of this period unless the policyholder has purchased a renewable policy; an option that allows him or her to renew the cover, regardless of any changes in health or occupation, until the age specified in the policy.

The premium for renewable term insurance rises at the beginning of each new term, or as death becomes more probable.

For the amount of protection it gives, term insurance is less expensive than any other type of protection up to about age 55. Most term policies can be renewed only up to age 65. A few can be renewed up to around age 100, but the premium for a term policy past age 65 will be extremely high.

Term insurance policies are seldom taken out past 65 because most families no longer need to protect against the loss of the breadwinner’s income. By this time, they may have pension or retirement benefits adequate to cover living expenses for the surviving spouse.

Term insurance is especially useful to young families that have only a small amount of money to budget for insurance but that need a large amount of protection.

In my experience, when money is tight, insurance can be forgotten. That’s potentially disastrous. If you choose ‘five-year renewable term insurance’, for example, a lot of protection can be arranged for a small outlay.

Longer-term policies cost more, and I’m not convinced that they are the best option for most families.

Decreasing term – often called mortgage protection – is a form of term insurance that is bought for a specific purpose. This policy insures the life of the mortgagor(s) for the amount of the mortgage at the time of the mortgagor(s) death. If the breadwinner(s) dies, the home will be paid for in full. The premium for decreasing term insurance is fixed, and the amount of cover decreases over time.

Always arrange life insurance to pay off a mortgage on your family home! (It’s maybe different for ‘buy-to-let’ mortgages where you might decide not to insure your life, preferring the property to be sold instead.)

There are other advantageous uses for term insurance. For example, a family that depends on current income to keep a child in school, college, or university can take out insurance on the breadwinner’s life for the amount needed to complete the child’s education. Commercial debt and leases can also be covered by life insurance, something many prudent businesses do as a matter of course.

Term insurance is often called ‘pure’ insurance because it does not include a savings element. That is, it provides for no cash build-up, as does, for example, endowment assurance.

A convertible clause gives the policyholder the right to convert a term insurance plan to whole life or some other permanent plan, and sometimes families take this option when they can pay higher premiums.

But this is anachronistic in today’s world of Individual Savings Accounts (ISAs) and pensions. There are nearly always better options for savings than life insurance!

Whole of life

Generally speaking, a whole of life policy furnishes the maximum amount of permanent death protection at the lowest annual premium.

Provided that all premiums due are paid, whole life policies will pay out whenever death occurs, hence their name. They are sometimes known as permanent policies.

Whole of life provides death protection throughout life, with premiums payable continuously until the policyholder dies.

Such policies used to contain a savings element, but this type ceased to be available some years ago. Whole life policies available today are pure insurance, akin to term insurance with no term.

Today, whole life policies are mainly used for specialist applications, such as inheritance tax mitigation planning and for those with long-term dependency issues.

Whole of life is much more expensive to purchase and, generally, of limited use for those wishing to insure the family breadwinner(s).

Endowment

The endowment policy is like a savings fund protected by term insurance. It offers insurance protection against death for a specified period of time. The policyholder decides that he or she wants to build up a certain amount of money by the end of a given number of years.

In a sense, the insurance company establishes a savings fund to which the policyholder contributes regularly and on which interest is compounded, usually annually.

If the policyholder lives to the end of the period, he or she will have accumulated – and can obtain – the face value of the policy.

What is face value? Let’s say a £50 per month endowment has a ‘sum assured’ of £25,000. The latter is the face value. If you pay all the premiums to the end of the agreed term, or die during it, the face value – here £25,000 – will be paid. (Perhaps more, if investment-linked or with profits.)

If the policyholder dies before the end of that period, the beneficiary will again receive the face value of the policy.

The limitations of the endowment policy arise from its incorrect use. The prospect of having a large sum of cash at the end of a relatively short period of time once led many families to purchase this plan, when their real need was for premature death protection.

Mainstream life offices withdrew endowments from the market some years ago – mainly due to the mortgage endowment scandal. Restrictions were placed on premium limits (£3,600 per annum) more recently.

The policies are still available from a handful of Friendly Societies who offer what they call ‘tax-exempt savings plans’ with premiums of £25 per month, such as Healthy Investment and Sheffield Mutual.

I believe endowments are an anachronism, and best avoided.

Special policy features

Regardless of the type of policy or policies your family decides to buy, it is important that you keep your plan flexible. To help keep it flexible, you can add special clauses, what I like to call ‘riders’ in the American fashion, to your policy.

Two of these clauses – the renewable and convertible clauses available with term insurance – were mentioned above.

Two additional clauses – which will add to the cost, but which may help you keep your plan flexible – are the disability clause and the guaranteed insurability clause.

The disability waiver clause allows for a waiver of premiums if the policyholder becomes permanently disabled or unable to work through ill-health. This is very useful as it means cover can be maintained should illness strike.

The guaranteed insurability clause (often provided free of any explicit charge) guarantees the policyholder the right to purchase stated amounts of additional insurance at specified times – such as the birth of a child or increasing a mortgage – in the future without providing any heath information. Often forgotten about, this clause can be helpful to those whose health has deteriorated.

Payment of premiums

The premium is the amount of money you pay to keep your policy in force.

The annual premium is almost always less when paid once a year and paying twice or four times a year usually costs less than paying once a month.

However the vast majority of premiums are paid monthly nowadays – as most people never consider the other payment frequencies – by direct debit mandate.

Life insurance needs across the Life Cycle

Life insurance needs of families change as different family members grow older. The amount of protection needed will also vary with the number of members in the family, the current and anticipated income of the family, the earning potential of the family members, other financial resources, and the goals of the various family members.

The single person

In general a single person needn’t bother with life insurance. They may purchase it if they choose to leave any other financial assets, such as their house, to someone else and they don’t want the tab for what are euphemistically called final expenses (funeral and legal bills) to be left to a family member or friends

Sometimes a young single person will be encouraged to buy insurance early in order to get lower premiums.

It is generally true that, the younger the insured, the lower the premiums for a given type of insurance. The younger the person, the lower the risk of death.

However the individual may be paying for protection that he or she does not need, just to get lower premiums throughout life. That’s a waste of money in the majority of circumstances.

Single persons may also want to take out insurance against their own death if they have dependent aged parents. This need for protection could apply during any stage of the life cycle.

Establishment of the family stage (no children)

The insurance needs of a newly settled couple (married or otherwise) with no dependents are likely to be the same as for the single person.

The businessman/woman, the professional person, or the farmer who borrows money to become established – for example, to purchase equipment, supplies or livestock – should cover loans with insurance to protect his or her spouse/partner as well as his or her creditors. Term insurance should be considered to fill these needs.

Decreasing term insurance should be arranged to cover mortgages and something like family income benefit could be considered to protect rent payments.

In this stage of the family life cycle, the couple should try to save for the future. Often both of the couple are working. Building up cash reserves and establishing longer-term investments using tax-efficient things like ISAs and pensions should be a priority, especially if the plan is to have children in due course.

The arrival of children

Without wishing to be accused of gender bias, even today it remains true in my experience that while the children are very young, the death of the father is usually the greatest hazard faced by the family.

Of course if the father is a ‘house husband’ while the mother works, the gender roles and risks I describe here and below are switched.

Though a young mother may be working or may be able to provide income for the family if the father dies, it is more difficult for her to leave home during the preschool and first school stages than at any other time during the family life cycle.

Even if she was working before the death of the father, her income will not be sufficient for the family to maintain the same level of living it did on two incomes. And if she was not working but now goes to work, her income may not be sufficient to maintain the standard of living it had with the husband’s or partner’s income.

Therefore, young families usually need a great deal of income protection from life insurance. At the same time, they typically have relatively little spare cash to provide this protection.

If your family fits into the early life cycle staged, here are some suggestions for getting the major protection you need with minimum expenditures.

What protection should you buy? The most important insurance need for most families is to insure the life of the sole or principal earner. Take care of this need before you buy insurance for any other family member.

The next important consideration, as ghastly as it sounds, should be burial expenses for the mother. If these expenses cannot be met out of current income or savings, consider buying a small whole life policy for, say, £10,000 to cover such ‘final expenses’.

If the mother works, your family might want to consider insuring against the loss of her income as well as against her death. Your family should also consider whether it would be able to meet the cost of caring for the children out of current income if the mother were to die. If you feel you would have difficulty meeting this cost, consider taking out a decreasing term insurance or family income benefit policy on her life. The family’s income needs for child care will decrease as the children mature.

Look ahead to the protection you will want for the possible widow(er) between the time the last child reaches 18 and the time when the widow(er) is eligible for a pension or other retirement benefits. The amount needed will depend on the ability of the non-breadwinner to support him or herself during this period.

What forms or types to buy? To keep the cost of your insurance at a minimum, buy term insurance with a renewable clause. Renewable term insurance should serve your family quite well during this period, particularly if the need for income protection is quite large in relation to what you can pay. If you qualify for group life insurance at work, be sure to join the scheme at the earliest opportunity.

Five-year renewable term price comparison
£250,000 lump-sum cover for a male accountant, non-smoker, born 12/01/1986

Insurer Monthly premium
Royal London £10.87
Zurich £11.35
Aviva £12.42

Source: Source: iress/The Exchange 12 June 2018.

Sixth Form/College and university stages

The years when the children are in sixth form or college or off at university are a good time to re-examine your family’s needs for life insurance. Since the children will not be dependent for many more years, you may want to change the kind or amount of protection you are carrying.

By the time the children are in sixth form or college, the former primary caregiver will probably be back working outside the house. He or she may be in a better position to provide income for the family if the main breadwinner should die unexpectedly.

Any family’s life insurance programme should be re-examined whenever there is an employment change in order to keep the family’s economic security programme up to date.

Recovery stage

The recovery stage of the family life cycle is characterised by the financial independence of the children. The non-main breadwinner is usually the only dependent during this stage, and he or she is probably in the work force, too. If not, be sure that he or she is provided for in the period between the possible death of their partner and the time that he or she is eligible for pension or other retirement benefits.

Your family should make a special effort to build up savings for retirement during the recovery period. Put aside regular amounts for saving.

Retirement stage

When you reach retirement, your family’s need for life insurance is usually much less than in former stages, especially if the couple are nearly the same age.

The widow or widower may be eligible for limited state benefits or other retirement benefits if his or her spouse or partner were to die. He or she may also have money from an ISA or pension plan, or some other form of retirement savings.

During this period, some families purchase annuities. Annuities are the opposite of life insurance – they are used to insure against dying too late and thus outliving your savings.

One time life insurance might be used in the retirement stage is to help set up a fund to help pay for any inheritance tax on the estate. This is a specialist area requiring detailed advice.

Setting up life insurance and using trusts

Apart from the application process – which an IFA can certainly help with – you need to consider the way in which you arrange your life insurance policies.

In most cases, you buy a life insurance policy for someone else: your spouse, partner, children or creditor. It’s best to ensure this plan comes to fruition by arranging the policy correctly.

Sometimes, a life of another policy is arranged. A good example is a wife owning a policy written on her husband’s life. But this is less common nowadays as trusts have become easier to arrange thanks to on-line functionality and simplified documentation.

Simply put, placing a policy into a suitable trust means that the life insured (the ‘settlor’) fills in a form appointing trustees (often a spouse or partner) who would control the sum insured should he or she die whilst the policy is in force. The trustees then deal with the money, following the wide range of potential beneficiaries set out on the trust form. (Most trust forms have a box for specified beneficiaries.)

The big advantage here is that the life insurance payout is not part of the deceased’s estate and won’t be counted as part of his or her estate for inheritance tax purposes. The trustees can usually obtain payment quickly, too, and not wait for the estate to be dealt with in the usual legal way.

Most life insurers offer very good trust forms, which are free to use. It’s unusual to find a situation where a trust shouldn’t be used but, again, an IFA will be able to help.

The bottom line on life insurance.

  • Buy life insurance if someone relies on your income to maintain their lifestyle; protect your dependants.
  • Buy life insurance to pay off loans, such as mortgages and car finance should you die.
  • Don’t buy life insurance if the financial consequences of your untimely demise is zero!
  • Consider renewable term life insurance.
  • Consider, too, ‘family income benefit’ if you think your dependant(s) would find it hard to deal with investing a big lump sum to produce an income; ideally, a combination of these two life insurance types should be arranged.
  • Buy on-line or hire an IFA to help you through this process, as you feel best.
  • Set the policy up correctly; consider using a trust form.
  • Review your life insurance needs periodically. Things change!

Mark Meldon is an Independent Financial Advisor based in Cheddar, Somerset. You can find out more at his company website. You can also read his other articles on Monevator. Let us know in the comments if there’s a topic you’d like Mark to cover.



from Monevator http://monevator.com/life-insurance-and-protection-a-primer-or-why-you-should-buy-renewable-term-life-cover-most-of-the-time/

Tuesday, 12 June 2018

Three Personal Finance Tips That Will Change How You Manage Money

Good personal financial management is how you build a better and stronger financial future. Through good management of your income and expenses, you can maintain a healthy cash flow, focus on saving and investing, and have more room and flexibility when dealing with financial challenges.

There are already so many resources on how you can manage your personal finance better. In this article, we are going to take a closer look at 3 more personal finance tips that will change how you manage your money. Let’s get started, shall we?

Utilize a Financial Calendar

Missing some bills and payments that are due on a quarterly or annual basis can be catastrophic to your cash flow. This type of bill is often big in amount and has the potential of disrupting that month’s budget to a certain extent.

Unfortunately, we often forget about those annual insurance payments, quarterly taxes, and other long-term expenses. When the bills finally arrive with a short deadline, you have little to no option to choose from.

You can avoid missing these bills by making a financial calendar. Mark down the billing and due dates of each bill (i.e. insurance premiums, taxes, etc.) as well as the dates for long-term income (i.e. yearly bonuses, income from annual rent and dividends, etc.) to have better control over them.

Use Loans for Leverage

There is nothing wrong with having loans in your personal finance. Loans are useful financial instruments that can help you gain assets and fill financial gaps. One thing to worry about is how you use the financing options available to you.

When using short-term loans that you can find through CashLady, for instance, you have to be certain that you can repay the loan at the end of the term. When using a mortgage loan, make sure you can repay the loan early without excessive fees and penalties.

Loans are meant to be used as leverage. They are extra sources of financing to help you achieve productive financial goals. Use loans accordingly, and you can boost your income while taking your personal finance to the next level.

Don’t Forget the Big Picture

Personal finance is often seen as a very personal thing when in fact it involves a lot of external factors. Just because you only need to worry about your personal goals, doesn’t mean you must not pay attention to the rest of the market.

There are metrics to follow in order to understand the market better. Useful financial metrics like the consumer index at CashLady are also great indicators to help you see the bigger picture. Based on how the market is doing – and where it is going – you can make better financial decisions at the right times.

Timing a loan application so that you get the best interest rate is a good example of how understanding the market can be highly beneficial. The same metrics can help you navigate through investment opportunities and new sources of income. You just have to know how to use information from various sources to maximise the benefits.



from Finance Girl http://www.financegirl.co.uk/three-personal-finance-tips-that-will-change-how-you-manage-money/

Monday, 11 June 2018

Martin Lewis: Is there any point in being married?

You meet someone, fall in love, and hearts pop out of the sky when you look at them. They’re the person you want to spend the rest of your life with. But is there any point in actually being married?



from Martin Lewis' Blog https://blog.moneysavingexpert.com/2018/06/martin-lewis--is-there-any-point-in-being-married-/

Friday, 8 June 2018

Weekend reading: A little extra work counts for a lot

Weekend reading: A little extra work counts for a lot post image

What caught my eye this week.

The ‘Just One More Year’ dilemma crops up all the time around these parts, so I was interested to see academics have put some numbers on it.

According to a report in Bloomberg:

A recent academic study called The Power of Working Longer, cited in the New York Times, finds that working just three to six months longer can raise your retirement income as much as increasing your savings by 1% every year for the last 30 years of your career.

Heck, that’s not even a year!

Too many people set up a false choice between working until you’re 65, and retiring at 27 to live an ultra-frugal life in a tent.

Instead work smart, tend to spend a little less, tend to save a bit more, invest the difference, and see where you’re at after a decade or so.

You might be lucky! If not, keep going.

Taste, season, and adjust the cooking time as required.

More on a working a little bit more

Here are the two sources cited by the Bloomberg piece if you’d like to read more:

Hope you enjoy the links below!

From Monevator

A big fat D- for me, as we got no new content up on the site this week. I’m working on a fix, so please bear with us. By the end of summer we should be back to a regular schedule. (Add fibre allusions to suit.)

From the archive-ator: Reasons to rent instead of buying – Monevator

News

Note: Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber.1

House prices jump £3,000 in a month despite ‘subdued’ property market – ThisIsMoney

London’s ultra-low emission zone to extend to North and South circular [Good!]ThisIsMoney

Revealed: The mystery trader who roiled Wall Street [Search result]FT

The real price of Madagascar’s vanilla boom [Search result]FT

Products and services

Atom Bank launches best buy one-year fixed saving deal – ThisIsMoney

Eight taxes that you could incur by getting involved in the property market – ThisIsMoney

Sky vs BT vs Now TV: the cheapest ways to watch the 2018-19 Premier League – Telegraph

RateSetter will pay you £100 (and me a bonus) if you invest £1,000 for a year via my affiliate link – RateSetter

Fingerprint reading cards could be in your wallet by next year – Telegraph

Who really owns Bitcoin now? [Search result]FT

The 20 most consistent investment trusts over the past decade – ThisIsMoney

Five of the cheapest UK homes for sale – Guardian

Comment and opinion

The psychology of money – Morgan Housel

Does private equity deserve more scrutiny? – A Wealth of Common Sense

Martin Lewis: 5 changes to fix student finance [Search result]FT

Downsizing: Taking stock, 5 years on – Can I Retire Yet?

Spending speed bumps and your future self – Abnormal Returns

Do you have enough water in your whiskey? – The Evidence-based Investor

Hedge funds have lost their dynamic creators of value luster [Search result]FT

How to copyright a song and earn royalties – Financial Samurai

Invesco fees row is a tragedy for shareholder democracy [Search result]FT

Equities outperform bonds? [Stock picking is mega risky, with skewed returns]DIY Investor

Pulling the thread with Tren Griffin [Podcast]Invest Like The Best

Is BT’s near-8% dividend yield a good reason to buy? [PDF]UK Value Investor

Reps, reps, reps: How to become a learning machine – Of Dollars and Data

Factors from scratch [For the investing nerds among us!]OSAM

Kindle book bargains

The Idiot Brain: A Neuroscientist Explains What Your Head is Really Up To by Dean Burnett – £2.59 on Kindle

How To Be F*cking Awesome by Dan Meredith – £0.99 on Kindle

Quiet Leadership: Winning Hearts, Minds and Matches by Carlo Ancelotti – £1.99 on Kindle

Eye of the storm: 25 years in action with the SAS by Peter Ratcliffe – £0.99 on Kindle

Off our beat

How a former Tesla staffer became an Internet sales millionaire in his spare time – Bloomberg

Beaufort Brexit scale [Funny. Sort of.] – via Twitter

Why having your thoughts and dreams crushed can be a good thing – Young FI Guy

On immigration – Paul Dean

Anthony Bourdain’s theory on the foodie revolution – Smithsonian

And finally…

“Why do so few investment firms educate and treat their clients in this way? ‘It’s a joke, isn’t it?’ answers Buffett, adding that fund managers and brokers ‘don’t judge their success by investment results. They judge it by how much they can gather in assets. So they don’t want the shareholders to think of themselves as owners. They want them to think of themselves as customers'”.
– Cunningham & Cuba, The Warren Buffett Shareholder

Like these links? Subscribe to get them every Friday!

  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”.


from Monevator http://monevator.com/weekend-reading-a-little-extra-work-counts-for-a-lot/

Thursday, 7 June 2018

How LED Lights Can Save You Money

One of the easiest ways to save money in your home is by switching to LED lights. Yes, it’s that simple, and you could save a small fortune on your electricity bills per year. LEDs are better looking, more efficient, good for the planet and great for your wallet – if you haven’t already switched to them, here’s everything that you need to know about how they can save you money.

What are LED Lights?

The term LED stands for Light Emitting Diodes. They are relatively new to the mass market, but their energy-saving properties have been known for some time. LED bulbs have a lifespan of up to 30,000 hours on average, with some of the higher quality bulbs going up to 50,000 hours. They are incredibly versatile – you can combine LEDs with dimmer switches to create soft mood lighting or opt for bright task lighting in areas such as the kitchen and the study. Previously, LEDs were expensive to purchase due to the lack of availability, but now many mainstream retailers, as well as specialist LED lighting stores stock plenty of different types of bulbs.

How Much Do They Cost?

With LEDs now available widely, the initial cost of the bulbs is reducing.  You can expect to pay approximately £3 for a 4W GU10 bulb – the brightness of this is comparable to a 40W halogen bulb. Whilst you may believe it is more expensive to place LEDs in your home, the savings come from your energy bills and the fact that they hardly ever need to be replaced. The reason why LEDs are more expensive is due to the chip inside – it costs money to make, so this cost is passed on to the customer.

How Much Could I Save?

Your annual lighting cost could go from over £200 to less than £50 by replacing all of the bulbs in your home and using them for around 2 hours a day (the average estimate by the Energy Savings Trust). The best way to use LED bulbs to make a saving is to replace your halogen bulbs with an LED alternative each time the halogen ones break. This way you can spread the initial cost whilst still taking advantage of the savings. If you own a business and you’re thinking of making the switch to LED bulbs, you might be eligible to take advantage of tax savings from HMRC.

To calculate the cost savings of LED bulbs, you will need to know the following information:

  • The wattage of your usual bulbs and spotlights.
  • The average length of time that each bulb is in use per day.
  • The current electricity rate per kilowatt hour in your area. In the UK, this is around 14.71 pence.
  • The cost of replacing each bulb with an LED equivalent.

You can then use the following calculations:

Current Cost per Month = (Current wattage / 1,000) x usage in hours p/day x cost p/kWh x 30 days

New Cost per Month = (New wattage / 1,000) x usage in hours p/day x cost p/kWh x 30 days

Monthly Saving = Current cost per month – new cost per month

Payback Period (Months) = Total cost of replacement bulbs / monthly saving

How to Choose the Right LED Lights for Your Home

Now that you know all the benefits of LED bulbs for your home, you need to think about which type of lights will work for you. In the kitchen, undercabinet LED lights are very popular as they don’t cast shadows and they allow you to prep and cook food easily. In the dining room, you could opt for pendant lights as these make a stunning statement – just use a dimmer switch to control the level of lighting. You can even add LED lights to your stairs – this is known as plinth lighting.

Would you switch to LED lights to save money?



from Finance Girl http://www.financegirl.co.uk/how-led-lights-can-save-you-money/

Tuesday, 5 June 2018

Our Future Offices: Workforce 2025

We often watch movies where they present an imaginative interpretation of what the future would look like. Almost all films that are based in the future have a heavy emphasis on technology.

How realistic are these futuristic projections? Will we be much far off from the technology based lifestyles? With generation X and Y gradually making their way into the workforce, we can expect that their incredibly sophisticated, technology savvy upbringing will shape the way offices work. It is predicted that innovative technology will play a big part in future workforces and digitalise simple work processes. The concept is much different to what the older generations are used to but shows how workforces are shaping themselves to keep up with the current trends. Our future workforce will prioritise efficiency, productivity and style, and improvements will be made in regards to internet connectivity, software ease-of-use and job roles themselves to fit in with the new, modern work regiment.

Internet Connectivity

During recent years, the internet has become a crucial part of both our private and professional lives. Its use is widely applied to communications as well as data transfers. As our offices continue to evolve, we will find that the importance of secure and fast internet is now becoming a necessity.

The reason for the need for improved efficiency and stability of the internet is to allow offices to be more interactive beyond its walls. A technological advancement suggested by TalkTalk Business + leased line is the possibility of installing virtual reality systems into future offices. The whole infrastructure of virtual reality relies on internet connection. This would mean the chance of clients or your team to be able to visit and see different spaces, products and experiences without having to physically be at the location. Not only would this save costs, this would also save a lot of time.    

Ease of Software Usage

As our technology is getting more and more complexed, it is a common mistake to assume that only people who are tech savvy can use it. Advancements in technology also mean that it has to be user friendly. This is especially important for future workplaces, as it will allow a better utilisation of tools and softwares to your office’s productivity.

Virtual assistance is something that has recently been introduced to our homes and made popular by its added ease to everyday tasks. The impeccable blend of software to hardware can be seen from products like Apple’s Siri, Amazon’s Alexa and Google Home, using voice control to navigate softwares increases the easiness of use. Thinking of future workforces, the application of these softwares will improve productivity by great lengths. You can make a note by mumbling “set up a meeting at 10am with Dave” or “remind me in an hour to call Paul”, addressing tasks with immediacy and organising your schedule at work will make working a lot quicker and easier.

Job Roles

Inevitably, simple job tasks will be replaced by robots and artificial intelligence. The process has already begun in warehouses where robots have replaced manual workers, not only does this save time, costs but also improves accuracy. However, the rapid development of robotic and Artificial Intelligence (AI) technology would mean that roles there is a chance that they can help around offices as well.

Talk Talk imagines the possibility of having AI colleagues, this can be from virtual receptionists and even robotic management. According to their research, 32% of employees already think that AI and automation have the ability to make them more efficient in their job. Rather than replacing jobs, it will be an opportunity for existing employees to invest their time in more complex tasks, creating a better outlook for your company.

The future holds the potential for a lot of different possibilities, #Workplace2025 envisions the possibility of combining and utilising artificial intelligence, chatbots, robots, virtual reality and more within the office. One thing for certain is that internet connectivity will have to be enhanced to move with the times for all this to happen.

With different company sizes you might want to speak to professionals in finding the right scheme for you and making sure your connectivity is ready to go for when the new advancements come into place. There are many brands out there that specialise in internet connectivity for businesses, but it is recommended that you speak to an expert before making any decisions.



from Finance Girl http://www.financegirl.co.uk/our-future-offices-workforce-2025/

Monday, 4 June 2018

Beating the Life Admin Battle 

Emails, bills, diary alerts, and of course the dreaded snail mail; they all have a nasty way of getting on top of us. Dealing with them is never going to be fun, and if you’ve taken to unorthodox methods to avoid them, you’re not alone. In fact, a recent survey found that 32% of Brits ‘manage’ their bills by binge watching Netflix to distract themselves, whilst ‘hoping for a miracle’. It’s little wonder then that 30% of millennials feel anxious about their household bills. 

For many, this feeling of being overwhelmed seems to come from not knowing where to start in tackling the mountain of life admin that comes our way. After all, even though 59% of people are already considering changing service providers (therefore well aware that they could be getting a better deal elsewhere), a quarter of them have no idea how to actually go about doing it. 

If all of this is ringing true, here are some simple yet effective tips to help you take back control and get Bill Brave in 2018. 

  • Clear the backlog – If you’ve been burying your head in the sand with regards to your life admin, chances are you’ll have drawers full of envelopes and pages worth of emails that need sorting out. Think of it like finances; if you want to start saving up, it’s best to clear existing debts first, right? It’s the same principle here. Grab the bull by the horns, tackle those oft-ignored bills, and you’ll be in much better standing (and headspace) to start moving forward. 
  • Become the app master – Technology is your friend when it comes to navigating the traps of modern living, and admin is no exception. There are all sorts of apps that can help with everything from time management and productivity, to efficiency and general organisation. WonderBill is a great example. Displaying all your household bills in one place, accessed via a user-friendly dashboard, it allows you to monitor your various accounts, review outgoings, and switch deals with ease. 
  • Routine is key – We’ve all done it: putting admin off and telling ourselves we’ll get to it later, when in reality, we know that ‘later’ will never come. Building life admin time into your regular routine allows it to become habit, stopping it from feeling like such a chore, and preventing a backlog from building up again. Be it short, sharp bursts (like 10 minutes every morning) or setting aside an afternoon each week, find what works best for you and stick to it. 

With a few easy steps, a little bit of savvy thinking, and a more proactive attitude, conquering your life admin suddenly seems like a much less daunting task. 



from Finance Girl http://www.financegirl.co.uk/beating-the-life-admin-battle/

Saturday, 2 June 2018

Weekend reading: When you’re more jealous of a billionaire’s job than his bank balance

Weekend reading logo

What caught my eye this week.

I wrote a big comment under Fire V London’s fascinating post about how a tech billionaire of his acquaintance goes about investing. But then the Blogger comment system thing caused problems, as it often seems to, and it ate my second attempt.

(Perhaps the billionaire could fix that technology?)

The gist was I found myself hugely jealous. Not of the billion quid – bizarrely enough to most of the world, but perhaps not to some of you – but of the billionaire’s lifestyle.

His gadding around the world investing in start-ups and staying engaged with the latest big trends sounds like my dream day job:

David specialises ‘value-added’ angel investing, mostly (or possibly exclusively) in the tech sector. His investments vary in size from $500k to €10m+.

He has 30+ such investments and is reasonably hands-on with several.

My impression is he is looking for visionary, ambitious businesses based in Europe, where he can put some serious money to work – and he is not afraid of being the biggest shareholder.

The only way I can really justify my dabbling in unlisted equities is because I want to try to develop some similar skills to do this. But I know I’m just a baby version of this bloke.

Of course I also need to develop the spare capital to put to work to fund such ultra-risky investing… but that’s where the rest of my portfolio comes in!

Fellow investing junkies can read the whole post here.

From Monevator

A friend asks: Should I put all my money into this can’t lose cryptocurrency venture? – Monevator

From the archive-ator: Coping with the guilt of losing money – Monevator

News

Note: Some links are Google search results – in PC/desktop view these enable you to click through to read the piece without being a paid subscriber.1

Visa apologises after system crash causes card payments chaos – Guardian

Traders with pockets full of crypto quit Wall Street and The City – Bloomberg

Why does it take so long to sell a property? [Search result]FT

UK house prices slip as market loses momentum – Telegraph

Landlords are selling down a net 3,800 properties a month – ThisIsMoney

‘David’ takes aim at ‘Goliath’ Invesco in row over fund fees [Search result]FT

Get lucky: meet the competition addicts raking in thousands – Guardian

A judge sides with parents and rules their 30-year old son must rule out – CNN

‘I have lost £50,000 I didn’t have to lose’: cold-called investors stung by wind farm bond scheme – CityWireThe myth of the 20-year old entrepreneur – MIT Management [via Abnormal Returns]

Products and services

RBS/Natwest credit card holders warned spending could be ‘frozen’ under new rules – Guardian

Don’t get thrown off by sustainable fund labels [US but relevant]Morningstar

The FCA has published an FAQ for customers of bust broker Beaufort securities… – FCA

…UK investor society Sharesoc says write to your MP about the issues raised – Sharesoc

What medical treatment costs in various holiday destinations, and the cost of insurance – Telegraph

“How did Amazon know my new Visa card information before me?”Guardian

Do you know you can now make peer-to-peer investments in an innovative finance ISA and earn interest tax-free? RateSetter will pay you £100 (and me a bonus) if you invest £1,000 for a year via my affiliate link – RateSetter

Comment and opinion

How about now? – The Irrelevant Investor

Investing is overrated, and other lessons learned over 25 years – Morningstar

Holding through a crash: Easy in theory, difficult in practice – Of Dollars and Data

Humphreys, Rwanda, and why you should invest in frontier markets [Search result]FT

The Lifetime Allowance for pensions explained – Young FI Guy

Looking behind the obituaries of those frugal and secret millionaires – Humble Dollar

Tim Hartford: I can make one confident forecast. My forecasts will fail [Search result]FT

Playing in traffic – A Wealth of Common Sense

The real reasons people take financial advice – Money Marketing

Investing is no place for ‘Once upon a time’ – The Value Perspective

Robert Shiller thinks Bitcoin will probably go extinct – Dealbreaker

Kindle book bargains

How To Be F*cking Awesome by Dan Meredith – £0.99 on Kindle

Quiet Leadership: Winning Hearts, Minds and Matches by Carlo Ancelotti – £1.99 on Kindle

Successful Self-Publishing: How to self-publish and market your book in ebook and print by Joanna Penn – £0.00 on Kindle

Brexit

Here are 11 Brexit promises the government quietly dropped – The Guardian

The first Swiss lesson for Brexit Britain: Negotiations never end – Prospect

It was a mistake for the Government to equate Brexit with leaving a European customs union and the single market – Evening Standard

Off our beat

Why no-one answers their phone anymore – The Atlantic

Newly created molecule could prevent the common cold – Imperial College London

Obituary: Musician Glenn Branca, 1948-2018 – Wire

Ethiopia already is the China of Africa – Bloomberg

Benedict Come-and-get-some – Telegraph

And finally…

“Churchill sent Keynes a cable reading, ‘Am coming around to your point of view.’ His Lordship replied, ‘Sorry to hear it. Have started to change my mind.’ ”
– Philip E. Tetlock, Superforecasting: The Art and Science of Prediction

Like these links? Subscribe to get them every Friday!

  1. Note some articles can only be accessed through the search results if you’re using PC/desktop view (from mobile/tablet view they bring up the firewall/subscription page). To circumvent, switch your mobile browser to use the desktop view. On Chrome for Android: press the menu button followed by “Request Desktop Site”.


from Monevator http://monevator.com/weekend-reading-when-youre-more-jealous-of-a-billionaires-job-than-his-bank-balance/