The tumultuous events of the last two years have forced many Barbadians to re-think the state of their finances, and to question if they can weather another storm.
The short answer is “it starts with budgeting”. A good budget will encourage investing and the development of a diversified portfolio. With the right expertise, budget, discipline and time, you’d be surprised at what you can accomplish.
Things to remember when ready to put your financial house in order:
1. A budget is more than paying bills and saving.
A comprehensive budget involves debt management and devising ways to pay down on debt faster. It includes insurance coverage to protect your assets - your house, contents and vehicle. It also includes health and life insurance. It involves investment instruments like mutual funds that can help finance pivotal milestones, like real estate, developing businesses, covering university tuition, and of course, your retirement.
At Sagicor Asset Management we will start off your assessment with a risk tolerance questionnaire. This helps to assess your investment objectives and constraints from a total portfolio perspective, and allows financial advisors and wealth managers to recommend the optimal asset allocation and investment selection to best achieve your financial objectives.
2. Building the budget.
A comprehensive budget needs to look at an overall assessment of assets versus liabilities, and income versus expenses. Be realistic in the estimate of expenditure and factor in a buffer for any contingencies.
3. Beware of the myth about investing.
People procrastinate when it comes to investing, mainly because they feel they don’t have the amount of wealth necessary to invest. This is a myth. Without a clear budget and financial strategy, investing might seem scary and overwhelming. Review your finances and build a comprehensive budget, which will help to better assess available products and allow you to start investing. Mutual Funds are excellent financial instruments to invest in and gain considerable returns. The longer you can invest in the market, the more compounded interest you earn.
4. Get help from financial professionals.
Sound financial planning is accessible to everyone, and everyone is deserving of assistance in planning their finances. Seek the right help from the right people and achieve more than you could have ever thought possible. With discipline, commitment and guidance, everyone can budget, strategically invest, and reap substantial rewards.
Contact our Head of Wealth Management today, and let him help you put your financial house in order.