April 16, 2017
The new year and the new presidential administration has ushered in a host of fiscal changes that could impact your wallet. Safeguard your money and act in the best interest of your household or business’s bottom line by learning more about the growing financial trends in 2017.
Rising Interest Rates
Interest rates are on the rise in 2017, creating a financial environment that is geared more toward saving than borrowing. In fact, people who put money into personal savings and retirement accounts have the opportunity to create and grow their wealth. Alternatively, people who need to borrow money face paying higher interest rates and making larger payments on their loans each month.
The higher interest rates correlate to the expanding economy and the creation of more openings in the American job market. As unemployment rates go down and American workers may more money, they have the unique opportunity this year to save money and take advantage of rising interest rates that could lead to greater personal wealth. Capital management services offered by professionals like James Dondero are also expected be more in demand this year.
Freelancing in Retirement
This year also has the makings of being the ideal time for retirees to make some extra cash doing side gigs. It is no secret that retirees are living longer and often outliving the money they have set aside for this time in their lives.
Until recently, however, people in this age demographic had few chances to earn extra cash. Many employers did not want to invest time and effort into training employees who would leave the workforce sooner rather than later.
However, thanks to companies like Uber and Lyft that rely on freelancers, senior citizens now have the opportunity to work for themselves as independent contractors and earn money that will not put their Social Security incomes in jeopardy. Along with driving for Uber or Lyft, they also can freelance as writers, artists, tutors, and other independent contractors.
Investment Portfolio Automation
This year also shows signs of increasing the demands for investment portfolio automation. This automation makes investing with financial pros like James Dondero easier and essentially creates an ideal if not passive way for people to put money into the stock market without putting forth any unnecessary effort on their part.
Further, this automation shows promise of being tax efficient and low in cost. Moreover, it costs the same if not less than an exchange-traded fund.
About James Dondero
James Dondero began his career in the financial industry in 1984 and has since become one of the leaders in capital and investment management. As the co-founder and president of Highland Capital Management, L.P. in Dallas, Texas, Dondero also serves as the CEO and chairman of the board at HCM Acquisition Company. Before founding Highland Capital Management, L.P. he worked for top financial companies like American Express and Protective Life.
He graduated with top academic honors from the University of Virginia’s McIntire School of Commerce with dual degrees in finance and accounting. He is certified as a Certified Management Accountant as well as a Chartered Financial Analyst. He also volunteers for Dallas-based charities and organizations like the George W. Bush Presidential Library and Institute, Education is Freedom, Snowball Express, and the Perot Museum of Natural Science.
, financial planning
March 26, 2017
These days, many wealthy people are buying their citizenship in locations where it is easy for them to preserve their wealth. There are actually numerous countries that allow what is called an immigrant investor program. These programs are set up by the countries’ governments in order to bring wealthy people into their ranks, and benefit from those people.
Countries with Immigrant Investor Programs
Countries like Cyprus, Spain, Malta and Australia have these programs. It is likely that in the future, more and more countries are going to begin implementing these types of programs. Especially as more countries are feeling the strain of the global financial crisis. This can help energize their economies. The most popular locations are in Europe, the Caribbean, and the Mediterranean.
An example of this type of program can be found in Malta. Their program is called the Malta Citizenship by Investment Programme. This program grants ‘naturalization by investment to reputable individuals and their dependents, after a rigid and thorough due diligence processes that make a significant contribution to the social and economic development of the country.’ What are the benefits? After five years of buying property in Malta, this will be tax exempt on sale. There is also no inheritance or death taxes, no estate duty, no net worth or wealth taxes and no municipal taxes, rates or real estate taxes. Dual citizenship is also available.
The examples above for Malta are just the tip of the iceberg when it comes to the benefits for the wealthy related to immigrant investor programs. These programs are specifically aimed at the very wealthy. The investments required can range from $500,000 to several million dollars. For those that do make this kind of investment, this is a very small amount. In Europe, Bulgaria requires a $700,000 investment in government bonds for five years, whereas in the Caribbean, St. Kitts& Nevis requires a $400,000 investment in real estate or the sugar industry.
Why are the wealthy investing in new citizenship in this manner?
So if the investment is minor for these investors, then what makes them want to participate in this type of investing? The main reason for doing this is the tax benefits. The super rich are always looking for ways to keep their money out of the hands of their government, and hold onto as much of it as they can. In this instance, the countries offering these programs, like the ones mentioned above, offer lower income taxes, and, more importantly, inheritance taxes.
There are other incentives as well. These include:
• Access to better education
• A desire to escape political instability or disagreement
• Better passport or visa-free travel to more countries, especially those in Europe as part of the European Union
• Higher standards of living
• Tax advantages
There are even some of the very rich who try to avoid taxes altogether by bouncing between countries around the globe with different citizenships and residence permits.
Who are these extremely wealthy people making this type of investment?
Those who are gaining citizenship through investment are from all over the world. Generally, many of these wealthy are from the Middle East, India, South Africa and China.
So how can the not-so-wealthy take advantage of these programs?
There are a few countries that do not require as large of an investment, like Bulgaria, in order to invest in citizenship, but gain all of the benefits. Dominica, for example, is the most inexpensive deal. With only an investment of $100,000 plus some fees, citizenship can be bought. Even St. Kitts and Nevis has a cheaper program than the $400,000 mentioned above. For only $25000, you can make a non-refundable donation to the St. Kitts & Nevis Sugar Industry Diversification Foundation to get access to citizenship.
There are also many countries that offer citizenship for an investment below one million US dollars. These include Malta, Portugal, and other EU countries where you can also gain all the benefits of the EU. Of late, citizenship by investment in Malta is gaining popularity due to various benefits. Moving and living in Malta has become so popular also due to the economic boom there is on the island
The least expensive of them all may be Latvia, where with a five-year residency costs merely $96,000. The benefits associated with this program include a common visa policy shared by twenty six European countries, but there is no telling how long this deal will last.
More countries are now offering this type of Immigrant Investor Program to help their economies bring the wealthy, and not so super wealthy, into their citizenship.
, financial planning
March 25, 2017
The right thing to know – The world we live in is full of risks and insecurities. Families, individuals, businesses, assets and properties are exposed to numerous types and certain levels of high risks. These definitely include the risk of health, life, property, assets, etc. We know that it’s difficult to prevent these risks, especially sudden miss happenings so the financial world has taken the responsibility to protect business and individuals against losses by compensating them with finance. Therefore, insurance is required with the full pace that eliminates or reduces the loss caused by any risk.
When we talk about health insurance, the first thing that comes to our mind is ‘Grandparents’. Ever thought health is such an important thing, especially when it’s about growing age. Sometimes, we initially don’t take a risk of traveling with them to abroad; we suffer from a fear of bad health. But every time this tact can’t be followed rather we need to find some solution for this. The best and relevant to this is – Super Visa Health Insurance.
Now, what exactly is Super Visa?
Super visa is a long term multiple entry visa for both grandparents and parents of Canadian citizens or permanent residents. They can stay up to maximum 2 years in Canada for every visit. This is valid up to 10 years. However, a regular multiple entry visa is also valid up to 10 years; but you can stay for 6 months only for every visit.
Eligibility for Super Visa
Super Visa is for grandparents and parents for Canadian citizens or permanent residents. Apparently, the grandparent or parent must be admissible to Canada and meet all the terms and conditions. Read on:
- The applicant need to show Canadian medical insurance that meets the basic requirements and also covers then for minimum 1 year.
- The applicant needs a letter of finance support from their grandchild or child in Canada, who earns the minimum required income.
- Private medical insurance proof is required for the minimum time slot of one year with a copy of Canadian insurance company that covers hospitalization, repatriation, and health care and provides a minimum coverage of the certain amount, also is valid for the entry in Canada.
- A copy of employment insurance pay stubs for grandchild or child.
Although, the procedure can be little different if a grandparent or a parent is from another country, therefore, a visa is strictly required to enter Canada as a visitor. Health Insurance plays a key role in Super Visa, so make sure this is not ignored.
Validity for Super Visa
The maximum validity for Super Visa is 10 years, or it can be an addition to one month prior if the passport expires (whichever is earlier). Within this time Super Visa holders can stay up to two years.
On That Note
We truly know, how important is health insurance in today’s life, especially for our parents and grandparents. Therefore, in every limit, we need to make sure that this insurance is taken care.
, financial planning
, Health Insurance
, Medical Insurance
January 15, 2017
Try, for a moment, to think of a corporation that compares to Apple. What company has the name recognition, branding, and carefully constructed image that Apple has built over the last decade of total technological dominance?
The Leader of the Pack
The answer, of course, is that Apple has no real competition. Their rise to power has been slow and steady, but the cell phone industry analysis is indisputable. As of mid-2015, CNet reports that about 100 million Americans use iPhones. That’s roughly 1/3 of the population of the United States.
If you walk into your local coffee shop, you’ll immediately note the dominance of the MacBook as the preferred notebook computer for telecommuters across the US. Want a tablet? The iPad is the obvious choice.
The popularity of a product is one of the most important variables in determining whether there is money to be made in servicing and repairing that product. Consider other household goods, appliances, or even vehicles? If a car manufacturer produces a dominant model, and that model is purchased and driven by 1/3 of the US population, how many other services professionals can benefit from that popularity? Mechanics will exclusively service the model. Aftermarket part manufacturers will build and distribute exclusively for the model and re-sellers will benefit from exclusively carrying the model, since such a huge percentage of the population will purchase it.
Using the auto analogy helps to demonstrate the significant opportunity that exists for an iPhone repair franchise. Sure, cars cost more. But the impact of Apple’s popularity is difficult to comprehend without thinking in terms of other, similarly valuable products.
Apple Franchise Markets are Everywhere
One of the secrets to successful franchising is selecting an appropriate market in which to operate a new business. For some franchises, that decision can be tricky. Food preferences can depend on region. Educational and fitness needs are largely dependent on demographics like age and income. But Apple products, with their complete market domination, are present in every metro area and suburb, every college campus and retirement community. Uses vary, certainly. The average MacBook pro user will differ significantly from the average owner of an iPhone manufactured three years ago. Their repair needs, however, are universal.
Refreshed Apple Products as an Income Stream
Making money with an iPhone repair franchise is possible in part because of the multiple income streams that are generated by a familiarity with the products and the capacity to fix them. One of those income streams is the sale of refreshed products, which come in as trades for customers in search of an upgrade. Although we’re accustomed to hearing about how high-tech goods are out of date as soon as they are purchased, there are several reasons that consumers have proven to be quite interested in purchasing used or refurbished Apple electronics.
- Upgrades are largely software based. From one generation to the next, cell phones, tablets, and computers no longer change physically by leaps and bounds so that they quickly become obsolete. Instead, Apple (along with its competitors), rolls out downloadable software updates that keep even older hardware running for many years.
- New products are prohibitively expensive. Thousands of dollars for laptops. Hundreds of dollars for even the cheapest cell phone in the lineup. Apple products are extremely expensive, but that has done nothing but whet the public’s appetite for them. Middle-income consumers have kept the prices of used and refurbished Apple products steadily high for years, with online and iPhone repair franchise profits significantly greater, as a percentage of original retail pricing, than any other comparable goods. A car driven off the lot loses a third of its value immediately. A brand new iPhone does no such thing.
- Many repairs are easy. Broken screens and dead home buttons are often enough to send consumers—accustomed to instant gratification from their expensive devices—running to order a new tablet or phone. But the repairs are often simple and largely cosmetic, which means excellent profit margins on refreshed items. Frustrations with non-working features or broken exteriors often mean upgrades for buyers, but for an iPhone repair franchise they mean quick turnover, minimal investment, and exceptional profits.
Selling refreshed Apple products is worth investigating for any savvy entrepreneur as a personal experiment—list an item online for sale—something in a desk drawer that you’ll never use again—and look how quickly buyers flock to purchase your used electronics. It’s a lesson that warrants reflection.
December 16, 2016
The National Pension System (NPS), introduced by the Indian government in the year 2004 is mandatory for all government employees except the armed forces personnel.This scheme was extended to the private sector in 2009. It is a portable retirement savings account, which can be efficiently used to provide financial security to senior’s through a pension income.
This scheme offers benefits such as tax deduction of INR 1.5 lacs under section 80CCD (1) of the Income Tax Act (IT). An additional tax deduction of up to INR 50,000 under section 80CCD (1B) of the IT Act is also available. Subscribers also have the flexibility of choosing asset allocation between equity, fixed income instruments, and government securities.
NPS is known as a defined contribution scheme because returns under this scheme are market driven. The NPS interest rate changes based on the performance of the market and the asset allocation chosen by the subscribers.
Asset allocation under NPS
Funds invested in NPS can be invested into 3 types of assets namely equity, corporate bonds, and government securities. There are two investment options available under this plan;auto choice and active choice.
Under auto choice, funds are automatically allocated in a pre-determined proportion based on the age of the subscriber. For example for subscribers under the age of 35 years, funds are allocated as follows: 50% in equity and balance amongst corporate bonds and government securities. As the subscribers age, the exposure to equity is reduced and investment in government securities increase.
Under the active choice option, subscribers may choose the asset allocation as per their preferences. The NPS scheme allows subscribers to allot upto 50% of their contributions to equity. Subscribers may use this option to their advantage to maximize the potential returns. For instance, an Investor approaching retirement age (between 45 to 50 years) may opt for a conservative allocation by investing a substantial portion of his funds in government securities.
Maturity and Annuities
The primary objective of NPS is to create a corpus that is used to buy an annuity plan for regular income during the post-retirement years. At the age of 60, the subscriber may with draw a maximum of 60% of the funds as a lump sum. The remaining corpus is used to purchase an annuity that will provide regular income to the subscriber.
Subscribers may choose not to withdraw any funds and use 100% of the corpus to buy an annuity. However, if the corpus at the time of exit from NPS at the age of 60 years is less than 2 lacs, the subscribers may withdraw the entire amount in lump sum. To determine the potential income, individuals may use an online pension plan calculator.
In order to join the NPS scheme, the subscribers must submit the NPS application form, along with Know Your Customer documents to a Point of Presence (POP). Upon submitting the documents, the subscribers are issued with a Permanent Retirement Account Number (PRAN), T-Pin and I-Pin. Subscribers are informed of their PRAN application status via email and SMS. They may also know their application status by contacting the issuing bank. However, the subscribers may get in touch with the Central Record Keeping Agency (CRA) which manages the issuance of PRAN, in case the PRAN card is not received.
NPS is focused on offering financial security to the individuals after their retirement. The flexibility available for investors to allocate their contributions in different asset classes allows them to maximize the returns and accumulate a higher post-retirement income.
, financial planning
, Financial Retirement