It is very difficult to sell life insurance (long-term savings) to someone in their early twenties, now in their first job. Increasing reports of natural disasters killing thousands and destroying cities, crime and violence on the increase, the growing lack of a family unit in society for security and support, the uncertainty of jobs and the ever increasing cost of living; which would lead to questions about access to funds to deal with the effects of these situations. Savings must be proportion into different investments; an amount you can afford to lose, an amount set aside for emergencies, and of course, the main portion to grow your savings faster than inflation. This allocations changes as you get older and as the size of your total portfolio (savings amount) grows.Natural disasters affect people worldwide, as the facts of prevention, leave all feeling so vulnerable. Financial (including insurance) sectors react, slowing any previous economic growth in the region and this has a ripple effect on international trade and investments. Whether you are in the affected geographic area, in the economic region or think that you are far removed, you must examine the potential effects on your cost of living and on your savings. Rebalancing your portfolio to mitigate the negatives may require selling shares in companies that will suffer declining sales in the affected area and buying their competitors’ shares having less or no exposure.
Crime and violence are seen by many as localized events having a clear cause and effect and someone to blame, the police or the Government. Financial markets factor and immediately update the resulting risk into their pricing calculations. This is one of the major factors that affect your portfolio, therefore such steps implemented to reduce crime or news of actual violence, should signal you to reexamine your investments that are exposed. Depending on the type and frequency of the violations and on the actions taken by the authorities, you may be driven to sell your position in Government bonds and Treasury bills in the affected area and buy another taxation collection based body’s debt in an area that is presently experiencing less crime.
Broken families effects individual’s decision making, rooted in a lack of trust in others and is becoming more widespread. Financial positions are extremely well guarded and any advice is seen as suspicious, driving financial institutions to offer more anomalous non-personal contacts. The effects on your savings range from slow and overcautious to amateurish and mismanage, all crying out for a professional before it is too late. Families that pool their resources and support one another tends to hire a personal financial expert, similar to the family’s lawyer or doctor that after many years of service seems to be a very trusted part of the family.
Career management has replaced job security, offering skilled and experienced workers the opportunity to bid for contracts and remuneration to warn off cost of living increases. Yes, outsourcing helps slow inflation, sharing the risk to maintain competitiveness and forces individuals to think of cost to benefit in every proposed action. Your portfolio demands the same attention as your career; education and skill development, seeking and taking full advantage of opportunities and making decisions with long-term consequences.
Rationale
T.A.J & Associates Company Limited uses this occasion to comment on topics that have been covered, both academically and by the mainstream media, to add its opinion and point out investment opportunity, not to invoke any social action.
