Connect with us

Investing

SLUMPING STERLING – HOW CAN EXPATS DEFEND THEMSELVES FROM THE DECLINING POUND?

SLUMPING STERLING – HOW CAN EXPATS DEFEND THEMSELVES FROM THE DECLINING POUND?

By Laura Parsons, Currency Analyst

A combination of EU referendum uncertainty, disappointing UK data and falling Bank of England (BoE) interest rate hike expectations have seen the Pound plummet in 2016, with the currency falling by as much as 10 cents against peers like the Euro.

 With Sterling struggling across the board, UK expats are getting less for their overseas currency transfers then they would have this time last year.

 If you’re one of expats moving money abroad from the UK and feeling the pinch in the process, here are some tips for helping you mitigate the effect of Sterling’s fall and getting a grip on your finances.

 Own Overseas Property? Consider Renting

 In the UK, getting on the property ladder and owning your own home has always been viewed as preferable to renting. However, property shortages and exorbitant prices in popular locations have left many would-be first-time home owners living in rented accommodation, and the introduction of government-backed schemes have so far failed to ease the situation.

 The preference for property ownership vs. renting has been maintained by British expats, with the majority of those opting to move overseas purchasing real estate on foreign soil – particularly in nations where property is more affordable than in the UK.

 When the global financial crash hit in 2008, property markets in popular expat locations like Spain, Portugal and Greece were plunged into turmoil. While this was bad news for many existing property owners (with the values of expat/holiday homes plummeting) a number of expats took advantage of rock bottom prices and snapped up reasonably priced real estate in prime locations.

 Whether you paid over the odds for your foreign property or bagged a bargain, with the global economic climate still uncertain and Pound exchange rates proving increasingly volatile, it might be time to reconsider the benefits of owning property abroad.

 In June of 2015 the GBP/EUR exchange rate stood at 1.44. Twelve months down the line, the pairing has fallen 16 cents. If you’re finding that the notable difference in the exchange rate is making your mortgage payments difficult to meet, you may want to consider selling your current property and looking into the rental market. With a bit of research you could find a comparable property for a significantly reduced monthly outlay.

 Before deciding to sell your property, however, you should look into the market and see whether prices are at a peak or are likely to pick up in the future. If property prices have increased since you purchased your home and you were planning to move at some point in the future, this could be a sensible means of mitigating the impact of Sterling softness.

  Stay on Top of the Latest News

 The currency market never sleeps and with exchange rate fluctuations occurring on a minute-by-minute basis, picking the best time to make your international money transfer can make a significant difference to how much foreign currency you receive.

 However, how do you know if it’s the right time to make a transfer? While currencies can experience dramatic and unexpected movements in response to unforeseen circumstances (like China’s stock market crash at the beginning of 2016) industry experts can use both fundamental and technical analysis to track market movements and currency trends.

 This information is readily available online and you can use it to help you gauge the best time to send your money overseas. While some of the terminology can seem daunting, a number of outlets produce market updates which tone down the jargon and make the information more accessible.

 If you want to stay on top of the latest news and take advantage of any positive Sterling shifts, sign up to receive currency updates from reputable international money transfer providers and follow currency news sites on social media platforms like Facebook and Twitter.

 Knowledge is power, and with the right information to hand you can make your money go further.

Cut Back on the Costs of Living Abroad

 There’s no getting away from the fact that life is expensive. No matter where you live in the world, you’re going to have to deal with unavoidable expenses. But if your pocket is being pinched because of the recent Sterling slump, there are ways of cutting back on the costs associated with living overseas.

 One way of reducing your expenditure is to limit the travel costs attached to making trips back home. While catching up with friends and family is essential, the range of communications technologies available, like Skype, means it’s easy to stay connected without spending a penny.

 You may also find it more cost-effective to make larger, less frequent currency transfers rather than numerous smaller ones. Generally speaking, when you’re moving larger sums overseas you tend to achieve a better exchange rate, meaning your money goes that bit further.

 Another simple tip is to shop smarter. Many expats miss familiar foods when they move overseas and tend to splash out in the expat sections of supermarkets. As imported food is by necessity more expensive, it makes sense to find a local equivalent instead. It may take a bit of trial and error finding the right products but it could save you hundreds of pounds a year.

 Alternatively, if you find there’s just no substitute for real marmite or PG Tips, ask any visiting friends or family to bring you over a supply of your must-have goods. Of course, you don’t want to drive up their baggage costs so you may want to restrict this request to smaller items!

 Consider Your Currency Transfer Options

 One of the easiest ways to counter the impact of Pound Sterling volatility is to look into your currency transfer options early on.

 There are a number of international money transfer providers out there, but some will offer you a better deal than others.

 When selecting a provider do an exchange rate comparison to see who’s offering the most competitive rates. It’s also important to find out whether they charge transfer fees. Some do and some don’t, and this can make a serious difference if you’re moving money abroad on a regular basis.

 Other important considerations when choosing a provider include their level of customer service, fund security and the range of transfer options available. Some providers will offer services like forward contracts, which allow you to fix an exchange rate for up to two years in advance of a transfer. Fixing a rate can be particularly useful if you want to budget for an overseas property purchase or sale.

 It can take a little time and research to find the best international currency transfer provider for your needs, but the effort can be really worthwhile long-term.

 Seek the Support and Advice of Other Expats

 If you’re really struggling to get a grip on your finances you may want to seek independent financial advice. However, connecting with other expats in similar situations could also prove useful.

 You could uncover simple ways of cutting costs by asking expats living in the same area for their insights and advice on saving money while living abroad. You might discover, for example, that you’ve been paying over the odds for your utilities and be made aware of a cheaper, alternative provider.

 Your fellow expats may also have knowledge of tax breaks you’re unaware of, know of a mortgage provider offering better rates or be able to recommend cheaper supermarkets or clothing outlets.

 If you don’t live in a bustling expat community, get online and sign up for expat forums. These can be invaluable places to connect with other people in similar circumstances and most are free to join.

 If the Sterling slide is giving you cause for concern, consider implementing some or all of these money-saving measures and see if you can protect yourself from further Pound losses.

Investing

Risk Mitigation & The US Election

We need to talk about the election.

For the past four months, news cycles have been dominated by the COVID-19 pandemic. It is easy to forget that, for investors, the November US election was to be the defining issue of 2020. The winner will potentially impact the direction of travel of investments, regulation, corporate earnings and balance sheets for at least the next four years.

Sign up for the free webinar on the US Election & Risk Mitigation live on August 12th at 12pm EDT

Key takeaways:

  • Learn how to protect your assets against the risks posed by the US election
  • Understand how Chief Investment Officers are adapting to the United States’ political landscape to gain a competitive edge
  • Identify investment opportunities in this uncertain time

We will be joined by:

  • Shannon Saccocia, Chief Investment Officer, Boston Private
  • Stephanie Link, Chief Investment Strategist, Hightower Advisors

Sign up for the free webinar on the US Election & Risk Mitigation live on August 12th at 12pm EDT

If you can’t make it, sign up and I will send you the recordings.

 

Kind Regards,

Marek Razzouk

Research Lead, Financial Services

Investment Summit by Reuters Events

Phone: +44 7748655237

Email: [email protected]

Investment Summit by Reuters Events is part of Thomson Reuters.

Investment Summit by Reuters Events is the central hub for investment executives. Through in-depth industry analysis, targeted research, niche events and quality content, we provide the industry with a platform to network, discuss, learn and shape the future of investment.

Continue Reading

Investing

The impact of a recession on your pension

The impact of a recession on your pension 1

By James Turner, Director at Turner Little 

The stock market is beginning to show signs of life as measures introduced to help businesses amid the pandemic begin to take hold, but much is still uncertain. There’s no doubt that the pandemic has affected most people’s finances. From the Bank of England’s decision to reduce its rates, to the potential loss of earnings for people forced to remain at home, there is much to contend with.

“Naturally, at times of economic uncertainty such as these, people fear their retirement pots will be wiped out. For most people, their pension is one of the most valuable assets they hold,” says James Turner, Director at Company Formation Specialists, Turner Little.

So how could the continued pandemic and impending recession affect your pensions?

“If you have a defined contribution pension, your savings have probably been hit hard as a consequence, because pension schemes invest in the stock market, so big rises and falls can have an impact,” says James.

James Turner

James Turner

“It is important to remember that pension savings, as with any investment, is usually long-term. If you’re young, there’s still time for markets to recover before you take your pension, but if you’re close to retirement, there is the potential that your pot could have taken a bigger hit,” he adds.

Pensions are typically invested in stocks and shares, bonds, property and cash. If you’re concerned about its value, most schemes now have online platforms where you can see how your investments are performing.

“It’s important to treat your pension as an asset, and asset protection is all about planning. Effective planning ensures that no matter what happens, you will remain in control of your assets,” says James.

If you’re interested in finding our more about asset protection and would like to discuss your specific requirements, get in touch with us today. Our specialist team of experts will deal with matters pragmatically and sensitively, taking the time to meet with you and discuss your individual objectives in detail, in order to provide solutions that are uniquely tailored to your needs.

Continue Reading

Investing

The Business Case for Sustainable Wealth Creation: A Conscious Mindset Approach

The Business Case for Sustainable Wealth Creation: A Conscious Mindset Approach 2

By Mirjana Boznovska

The scale of the planetary crisis is so big that a fundamental shift is needed from business leaders and all stakeholders including investors, human resources as well as consumers. There is a new way of thinking emerging, one that is shaping the future of sustainable wealth creation with a focus on conscious mindset.

Humanity’s prosperity is linked to expanding our definition of wealth to include a respect for the environment and empathy for others. All of these come together and are the source of true innovation. Our future depends on learning to create wealth in sustainable ways.

Money and wealth are tools which help create opportunities. Opportunities for those who have it to do “good” in their environment, their community and globally. Serving society is the most inspiring and never-ending source for economic activities, creating value for humanity.

Sustainable Wealth

Sustainable wealth is future benefit that sustains future life. Sustainable wealth means consumption or the using up of benefits must equal additional investments that increase wealth, so wealth is maintained and sustained. When the spiritual dimension of wealth is interjected in the economic equation, physical wealth expands on two counts: a) there would be a lowered desire to consume materialism and b) the spirit of service would inevitably lead to increased wealth. Balancing ecological and economic consideration is an acceptable short-term goal of co-creating sustainable wealth, but in fact ecological restoration must be the long-term goal.

This would be possible only when unsuspected sources of clean energy are tapped and scientific research in ecological restoration is pursued. This is one way of looking at co-creating wealth that can help humanity pay back its ecological deficit. It’s about creating value without destroying value. The systems we create need to serve all individuals and the system itself.

Today our systems are increasingly feeding only the super-wealthy, and everything we understand about the human psyche is that we are creating a class of super selfish, super greedy people who take at the expense of individuals, society and our ecological systems. The depletion of social and environmental capital weakens our social systems. The world is interconnected, and different parameters are having an impact on our lives, our profession and on the worldwide economy.

The question that arises is how can we as an individual and as part of the global economy create sustainable wealth, balancing economic and ecological priorities?

The question is closely depending on how we start and manage a sustainable economy based on strong and long-term industry. The global economy remains market-centred, even though the evidence has been mounting that these markets are failing us and the planet. Tweaking this model isn’t good enough We need a new paradigm which will provide a new theory that fits our unfolding reality, a new environment-centred economics that can maximize not profit alone but the well-being of living things – it’s about conscious business which requires conscious leadership.

The Three P’s

Conscious business supports the idea of the three P’s: People, Profit, Planet. The authentic motives behind such choices are self-mastery, love, care and the desire to serve.

What is Business Sustainability? Business sustainability is often defined as managing the triple bottom line, a process by which businesses manage their financial, social and environment risks, obligations, and opportunities. We can extend this definition to capture more than just accounting for environmental and social impacts. Sustainable businesses are resilient, and they create economic value, healthy ecosystems, and strong communities. These businesses survive external crisis because they are intimately connected to healthy economic, social, and environmental systems. They require conscious leadership with a conscious culture and conscious service. A paradigm is a set of interconnected ideas that have a logical cohesion.

The Business Model for the 21st Century

In most discussions about the business case for sustainability, the emphasis has been on the bottom line. The value of sustainability has been analysed from every direction—revenues, profits, and share prices. However, sustainability is more than just about firm-level benefits. Businesses, business schools, and society recognize that the current course of production and consumption cannot be sustained within our natural resource limits.

Businesses develop the products and services consumed by individuals around the world. The vast resources extracted by business for society’s use have created waste streams that find their way into our land, air and water and compromise human health. New businesses are being built on an understanding of the problems that have emerged through the 20th century. Increasingly, old businesses are evolving to use fewer resources, intensify the resources they do use, and renew and reuse the products they sell. New relationships are forming between businesses as firms realize synergies from interdependence; one firm can profit from another’s waste, or several firms can benefit through flexible supply chain relationships built on common interest.

The 21st century is revealing a new paradigm in which business is no longer separate from society. Realizing the new “business-as-society” paradigm will require the efforts and ingenuity of organizations across sectors and industries. It will challenge the current generation of business leaders to apply their hard-won knowledge to novel problems, and the next generation to evolve into conscious leadership and address issues of unprecedented importance and complexity. Those businesses that identified the hurdles and challenges described in this article, along with those businesses that aim to overcome them, will help to shape this new business landscape. The concept of sustainability is undeniably compelling.

Let’s consider for a moment the move towards a paradigm whereby the business decisions were aligned with the best ecological decisions, ie conscious business and conscious service. The business case for sustainability draws on several core arguments. Pro-environmental practices create positive brand associations among consumers, politicians, and regulators. They also anticipate regulatory trends and position the company favorably when such policies become law. The mindset shift required that seeks to further efficiency in materials and waste carries over into other realms of conscious leadership. Similarly, the innovation required to overcome environmental challenges promotes innovation generally. And employees have high morale when they believe in what their company is doing.

However, there are still many barriers to sustainable wealth creation as it would appear. When we take a step deeper into the definition of service, fear usually comes up, uncertainty, and a moment of self-definition. Who am I and what do I serve? Whether inside or outside the business world, the same questions arise.

“It doesn’t fit the business model” or “How are we supposed to measure the impact” are common examples of why it requires a mindset shift to start building sustainability from supply chain activities to HR practices.

Mirjana Boznovska

Mirjana Boznovska

Ordinarily such principles fall into the realm of self-awareness, self-mastery, and spirituality, separate from, and opposed to the world of commerce. Essentially a desire that comes from within, to have a positive impact and make a difference in the world which comes from the highest calling to serve. Leaders seem conflicted. It is time for this separation to end. Everyone, even the most jaded corporate executive, yearns for it on some level, yearns to align his/her productive life with his deepest care and highest values. Essentially it is the human condition, that we each want to know that we have made a positive difference in the world. This does not mean to ignore business realities and throw caution to the wind. It means to take the next, slightly scary, slightly outrageous, next step. It is the step for which there is no credible “business case.” It comes from a different motive – it comes from within.

In fact, the “business case for sustainability” does hint at something true. When we take a step into service, the world eventually reciprocates our generosity, albeit in a form and timing that is impossible to predict. A business “case” involves numbers and predictions, but the general principle that it is trying to convey is that the gift moves in a circle. As you do unto the world, so, in some form, will be done unto you.

To take this next step always requires at least a little courage, because it goes against familiar practice and predictable financial self-interest. Someday, hopefully soon, we must change the business environment to end the opposition between profit and ecological well-being and promote the alignment of ecology and money.

Herein lies a vastly different sort of “business case” for sustainability. It comes from questions like, “Who are you, really?” “What do you care about?” and “What do you serve?” “What are your values and belief systems?” “What is your unique self-expression you bring to the world to serve others?” From a deep consideration of such questions, courage is born to overcome the hurdles.

Hurdles to Overcome for Business Sustainability

  1. Measurement of sustainability.

Sustainability initiatives can be particularly difficult to measure because they often affect people and society at a macro level, and their organizational implications are unclear. Further, their impacts are not immediately obvious, and they depend on who implements them and how. Many suites of metrics and measurement systems—such as the Global Reporting Initiative, ecological footprint, and life-cycle assessment—currently exist to help managers measure their sustainability. Government policies need to incentivise outcomes and be more clearly connected to sustainability. Governments have several tools at their disposal, such as taxes, regulations, and markets, to encourage businesses to steward environmental resources.

  1. Consumer choices do not consistently factor sustainability into their purchase decisions.

Understanding how consumers value sustainability in the context of other product attributes would help businesses develop products that meet their needs. Further, there may be a role for business in educating consumers on issues and product attributes, resulting in more informed purchasing decisions. It also applies to investors. Shareholders and lenders must decide where to invest their money. How do they choose between different companies, which requires trading off one set of corporate attributes for another? Understanding how people make trade-offs will help businesses make sustainable choices.  

  1. Sustainability still does not fit neatly into the business case.

Companies have difficulty discriminating between the most important opportunities and threats on the horizon. Better guidelines are needed for engaging key stakeholders,

  1. Research shows employees would rather work for sustainable firms—and some would even forego higher earnings to do so.

Firms must better leverage this knowledge to attract and retain the best employees. These mechanisms should allow firms to leverage their sustainability initiatives and values, building the right capacity internally and ensuring progress is made towards sustainability goals.

  1. Current financial decision-making does not fully capture the value of sustainability-related investments.

These investments are often based on long-term and intangible rewards, whereas many investments made are based on the short-term impact on the bottom line. Sustainability managers need to be well informed exactly how returns on sustainability investments can be measured and seen. What are the short-term and long-term ways to assess and justify these investments? How can sustainability executives demonstrate the value of sustainability within the decision-making language and framework of finance executives? Until sustainability becomes accepted as a legitimate—and value-creating—activity, it may lose out to projects that are more easily understood and evaluated.

  1. Businesses need guidance on how to evaluate the materiality of an issue, both for disclosure purposes and for strategic planning.

Equipped with an understanding of which risks and opportunities are most material to their organization, managers can then prioritize material issues, translate them into internal strategies, and communicate them to stakeholders. There is no common set of rules for sourcing sustainably.

  1. Businesses want to purchase products and services that are environmentally and socially responsible. But the process of identifying sustainable suppliers is not always straightforward, and the means for comparing products is not always obvious. Sustainable sourcing decisions may also require industry-specific knowledge and practices, or data that just may not be available. Identifying a set of best practices for sustainable sourcing would provide organizations with targets for benchmarking as well as guidance on managing their supply chains. It would also yield an opportunity for leading businesses to showcase their good practices.

The Old Money Paradigm and Why It’s Not Sustainable

While conventional investing only focuses on the traditional risk and returns considerations in making investment decisions, socially responsible investing considers other ethical factors .The world needs to focus on mutually beneficial partnerships, fostering sustainable development across the continent, targeting the continent’s inhabitants as its primary consumers. Reports such as one published recently by the Business and Sustainable Development Commission, show that sustainable business is an untapped $12 trillion opportunity, making sustainability the most lucrative business sector there is.

What Is Money? Why Was It Created?

Money, in some way, shape or form, has been part of human history for at least the last 3,000 years. Before that time, historians generally agree that a system of bartering likely used. Money derives its value by virtue of its functions: as a medium of exchange, a unit of measurement, and a storehouse for wealth. It is merely an exchange of energy.

A New Paradigm Shift in Wealth Creation

Creating and amassing wealth is more than just a necessity. For centuries, the practice of climbing the ladder to richness has led to wars, influenced literature, and shaped cultures. Whether wealth comes in the form of money or food, all civilizations have pursued it.

The system of wealth creation is based on the current worldview, which in turn is based on the way science is studied and perceived. Most people will not be aware of existing paradigms of wealth creation. They will be too busy accumulating and creating wealth rather than being concerned with the process which they and their wealth underwent.

The paradigm is all about teamwork – to create wealth, everyone must help each other succeed. No longer are the lesser indebted to make the greater richer. Everyone has to run the race, but everyone must hold hands to reach the finish line together.

Sustainable Wealth Creation addresses three very important questions:

  • Do financial statements accurately reflect a company’s position?
  • Do shareholders have protections and adequate controls?
  • Can company leadership make decisions confidently?

Sustainable Wealth Creation principles help answer these important questions by investigating the accounting, legal, regulatory, adjudicative, and economic structures of a country.

Economic systems change at a surprisingly fast pace. Since the information varies over time, the information needs to be monitored and refreshed to gain important insights when making investment decisions involving international equities.

An iceberg is a metaphor for traditional investment analysis regarding international equities. Most international analyses parallel domestic analyses by focusing on the traditional metrics that are akin to the visible part of an iceberg. The hidden information is like the submerged portion of an iceberg. It is key to success (or even survival) but not readily discovered.

What Lessons Are You Teaching Your Children About Money?

Modelling a way of being to our children.

If you don’t take the opportunity to educate your child how to manage money, the value of money and sustainable wealth creation, somebody else will. They will fall within the collective way of thinking. Conscious parenting involves sharing with our children the awareness of our environment, our power of choice, personal responsibility and self-mastery.

Continue Reading

Call For Entries

Global Banking and Finance Review Awards Nominations 2020
2020 Global Banking & Finance Awards now open. Click Here

Latest Articles

The ultimate tech guide to remote working for the casual worker   3 The ultimate tech guide to remote working for the casual worker   4
Business1 day ago

The ultimate tech guide to remote working for the casual worker  

By Paul Routledge D-Link Country Manager Like many others, you may have grabbed your laptop in the middle of March...

Safeguarding international logistics arrangements during the coronavirus crisis 5 Safeguarding international logistics arrangements during the coronavirus crisis 6
Business1 day ago

Safeguarding international logistics arrangements during the coronavirus crisis

By Adam Ewart, CEO and Founder of Send My Bag It has certainly been a whirlwind couple of months. The coronavirus...

The Future of Finance Teams: Digitally Transformed 7 The Future of Finance Teams: Digitally Transformed 8
Top Stories1 day ago

The Future of Finance Teams: Digitally Transformed

By Simon Bull, Sales Operations & Business Development Manager at Aqilla Finance teams haven’t always been at the forefront of...

High-yield bonds will help, not hinder, businesses’ recovery 9 High-yield bonds will help, not hinder, businesses’ recovery 10
Finance1 day ago

High-yield bonds will help, not hinder, businesses’ recovery

By Jesse Chenard CEO of fintech MonetaGo, One of the best indicators of stock market growth is high-yield bonds. The junk...

A holistic view of organisational security 11 A holistic view of organisational security 12
Business1 day ago

A holistic view of organisational security

By James Ward, Senior Cyber Consultant at MASS The finance sector is typically more developed than others when it comes...

IDnow: Putting a new face on identity verification 13 IDnow: Putting a new face on identity verification 14
Technology1 day ago

IDnow: Putting a new face on identity verification

By Charlie Roberts, Head of Business Development UK&I at IDnow Munich headquartered IDnow is an identity verification provider which uses AI-based...

Finance leaders must act against increasing fraud 15 Finance leaders must act against increasing fraud 16
Finance1 day ago

Finance leaders must act against increasing fraud

By David Thorley, Director of Customer Development, FISCAL Technologies The COVID-19 pandemic has resulted in a whole host of increased...

NextGen Communications – the future of customer experience 17 NextGen Communications – the future of customer experience 18
Technology1 day ago

NextGen Communications – the future of customer experience

By Andrew Beatty, Head of Global Next Generation Banking at FIS As software development increasingly resembles push updates in services,...

The UK Property recovery has begun 19 The UK Property recovery has begun 20
Finance1 day ago

The UK Property recovery has begun

By Jamie Johnson is the CEO of FJP Investment, The UK property sector will be integral to the country’s economic...

The Derry Group launches new employee engagement and communications app 21 The Derry Group launches new employee engagement and communications app 22
Technology2 days ago

The Derry Group launches new employee engagement and communications app

The Derry Group, a one stop shop for the distribution, storage and order picking of chilled and frozen products has...