For years, people have said that insurance is sold and not bought. The stigma surrounding the industry and those representing it still hangs thick in our social memory, with old stories of brokers peddling policies purely to earn commission instead of seeking the best needs of their clients. However, in the last decade or so, we saw a shift in motivation for sales, with a breed of financial planners and advisors emerging who chose to put their clients first, not the product providers, insurance houses and investment offices.

Coupled with pandemic-influenced buying habits and near-limitless access to information, we are finding that risk products are being requested more and more, shifting it to a product class that is bought and not sold.

From various reports, research and client feedback, the most significant factor prompting consumers to start exploring different life insurance is their concern for the future, most likely heightened by the pandemic and other global issues.

Interestingly, people are only sometimes using cost as a motivator for their final choices. As financial advisors, we have found that our role has shifted from being gatekeepers of information to being gatekeepers of value. Where clients would typically ask for information about different products, we’re finding that the conversations are shifting more to understanding which products best suit their lifestyles and future goals. This means that cost is only one consideration, if it even features.

In a world of fake news, value is now found in product providers who can fulfil their promises and offer flexibility, integrated value and robust client engagement. Near-instant communication through online chats, social media and platforms like WhatsApp, means clients expect faster and more comprehensive feedback on claims, adjustments, annual changes and product upgrades.

Value is not only found in the end product; greater accessibility through digital buying platforms and underwriting innovations requiring a less invasive process all contribute to the perception of a company that can understand its customers and deliver on its promises.

At the end of the day, this relates to how we choose our risk cover, who we choose to invest with, and how we build our own reputations in the 21st century. Access to information, improved technology, and a recent history of black swan events have impacted how we consume and contribute to our local and global communities. If you feel like you need to rethink your financial plan, please get in touch soon and let’s see how we can enhance your situation.

“A deep life is a good life.” – Cal Newport, Author of “Deep Work: Rules for Focused Success in a Distracted World.”

Have you heard of deep work? A term coined by Cal Newport, deep work is a state of distraction-free concentration when your brain works at its maximum potential.

As you read this, you probably realise just how hard it is to find a space of genuinely distraction-free concentration. Even whilst reading this blog, you may be thinking about your next task, hearing the notifications from your mobile device or switching between tabs in your browser. We all have a ton of distractions that we’ve allowed to permeate, and often govern, our days.

So whilst we think we’re making the most of our productive time, there’s a good chance we’re not. Instead of deep work, we’re engaging in shallow work. Newport’s deep work theory suggests that to be truly productive, we should log out of all communication tools and work uninterrupted for long periods every day. So while we might not be able to step away from communication tools fully, we can aim for 60-90 distraction-free minutes at a time.

Deep work is effective for two reasons: it helps us avoid distractions and rewires our brains to help us learn hard things faster—so we can get better work done in less time. The next step to implementing deep work into your schedule is to choose a deep work philosophy.

In his book, Newport outlines four different philosophies to follow as you decide how to schedule your deep work. Depending on your lifestyle, some approaches may work better than others: 

Rhythmic philosophy

With this approach, you establish a regular habit and rhythm for deep work, blocking out between 1-4 hour chunks to focus at the same time every day. For example, schedule time for deep work between 8-10 am every weekday. The key to this strategy is consistency, which you can achieve by committing to a certain amount of deep work daily.

Journalistic philosophy

This method allows you to fit deep work wherever you can into your schedule. You could schedule time for deep work when you have 90 minutes between meetings, and this requires you to switch into deep work mode at will, which can be difficult for beginners. The rhythmic philosophy may be your best bet if you have a predictable meeting schedule.  

Monastic philosophy

This approach eliminates or drastically reduces shallow work across all aspects of your life. For example, science fiction writer Neal Stephenson famously avoids email and speaking engagements to free up his brain space for writing. That means Stephenson is nearly impossible to get a hold of but highly prolific, with over 80 works to his name.

Bimodal philosophy

This method involves dividing your time, with long stretches (at least a full day) set aside for deep work and the rest dedicated to everything else. Bimodal scheduling is a more flexible version of the monastic philosophy—instead of completely eliminating shallow work, you can spend a day or more working deeply and then return to your other obligations.

Again, like so many other skills we’re learning in our current age, it begins with mindfulness. Many of us begin our days by responding to emails, and before we realise, we’ve spent an entire day simply following the needs and requests of other people. Becoming mindful of how we spend our work time is the first step to choosing how to spend our time more productively. A deep life is a good life.

There are times in the year when we see and engage with more people than usual – through end-of-year functions, annual celebrations, birthdays, anniversaries, weddings, funerals and the like.

It can be wonderful – but it can also be stressful. We are quickly reminded that these old friends, colleagues and distant family from far-off shores have opinions that challenge our own, and they’re all too willing to offer unsolicited advice.

All these voices can be exhausting – especially if we’re already feeling a little burnt out or overwhelmed with what we feel we still need to accomplish. This is okay – we don’t have to take their advice too seriously, especially when it comes to managing our money.

You can choose to stick to listening to the voice of your trusted financial adviser and wealth management team. Actually, this is the best choice! When managing our finances, listening to too many voices can be treacherous to our financial plan.

It’s like when you’re buying a car; the more people you speak to, the more confused you’ll become. The same is true of your finances.

Working together, we want to create and follow a plan that helps you avoid common financial planning and investment mistakes in our relationship. This doesn’t happen once a year at a lunch party where the financial conversations tend to be rather superficial. This happens regularly and only after deeper conversations around meaning and purpose have been explored and brought into context by the money that you have.

Some of the high-level principles to keep in mind include the following:

   – Invest with a financial plan in place, don’t run an ad-hoc strategy

   – Invest in the correct products for your plan

   – Always remember the effects of inflation

   – Avoid spending your retirement savings when changing jobs

   – Let your emotions subside, then decide

So – what voices will you be listening to? When someone has skills, experience and qualifications that can help you AND has spent time understanding your needs and helping you put a plan in place that reflects your goals and risk appetite – you listen to their voice. Not only does it begin to echo your own, it will also help you articulate what’s important to you.

Religion, politics and money are all connected – and probably always have been! This is because they’re all currency for influence, power and status. These three topics can become highly volatile when we’re in social settings as they’re super subjective.

The markets, politics and religion all give us a sense of belonging, purpose and stories to share. Since they offer so much meaning, we’ll likely talk about them at any chance.

Depending on the crowd we’re with, our conversations will be dominated either by academics or opinions or perhaps a balance of the two. When it comes to elections (both in our country and others), the situation is the same too – so when you’re next around a dinner table, here are two crazy academic points that you can contribute to the conversation.

MARKETS – LOCAL AND OFFSHORE

The most common sentiment regarding political influence is around confidence in the leadership. This metric will directly influence investor confidence. This can be both local and offshore – if investors don’t like what leaders are doing, they are less likely to invest in local businesses (markets) and more likely to look at a heavier offshore weighting. The same too would apply to those who are sitting outside our country – and determine whether money is pumping in, or out, of our economy.

Administrative policies play an equally important role here as new administrations often like to shake up policies of previous administrations. These affect everything from the support offered to businesses at every level, living standards of the workforce, education and health for their families and the taxes we will pay for goods, services and investments.

This all leads to a more immediate impact – and that is the strengthening or weakening of the currency. Our buying power goes up and down accordingly – and once again circles back to how much we can afford to invest in our local economy.

TRADE RELATIONSHIPS

Elections in other countries can also heavily influence what happens in the local market as we have significant trade relationships with them. In his book, 21 Lessons for the 21st Century, Yuval Harari reminds us that all our communities are so intrinsically connected through trade-relationships that it’s hard to stand for any cause or initiative without indirectly supporting the opposition.

The clothes we wear, food we eat, cars we drive, technology we use and the social media platforms we communicate on are all manufactured, harvested, designed, managed and maintained using intricate global networks. 

Political movements and influence matter to all of us. The next time your dinner party runs wildly away with passionate opinionistas, you can throw in the above nuggets and sound like a guru!

Holidays should be a time of restoration and relaxation. But for savvy investors, who are seldom able to switch off or turn down the volume on their analytical brain activity, it can be a time of stress and panic. Whether you’re entering your annual time of leave or it’s a sneaky mid-year break, if you’re understandably nervous about your financial plan, fear not. 

While no portfolio is fireproof to completely uncontrollable events like black swans and major unforeseen global macroeconomic events, there is a lot you can do to limit your exposure to market-affecting shenanigans on the home front.

Don’t make any sudden moves. When it comes to investing, always remember: any change costs something, and it is also expensive when everyone else pulls the same move (like investing offshore). Try not to suddenly pull huge lump sums out of equities and into a different class without it being in line with your long-term strategy.

Switching things up in your portfolio is sometimes necessary, but we must do it with a comprehensive strategy, not a panicked whim before you go on leave. When nearing the end of an investment term, it could be an excellent time to change your weighting in various classes and the diversification of your portfolio. Feeling scared watching the news is not.

Don’t get involved in something you don’t know well. December is often the time for year-end bonuses. Feeling jolly, you may think: “Heck, why not try out Crypto?” 

Unless you’ve studied the market history, inner workings and headlines surrounding your options for more than a year, maybe give it a little more thought. (Many tried this back in 2017 when Bitcoin was trending and either lost all that irreplaceable, untraceable investment in a hacker’s spree or waited until December 2018 to find out it was worth 80 per cent less.)

Lastly – manage your emotions. We’ve shared many blogs on this, as it doesn’t only crop up when we’re heading offline for a break. Our feelings need to be felt, experienced and expressed, but they are not our whole truth and should not govern the direction of our financial plan.

Ultimately, investing always works best when you have a trusted, second opinion on any significant choice you make. Either knuckle down and focus on the people around you and let your money work for you, or let’s get in touch and have a comforting cup of coffee to bolster your portfolio.

In the previous blog, we looked at how we can help our children with their retirement, or financial independence, as many in our profession are starting to frame it. But the reality is, as the sandwich generation, we can’t only be thinking about our own and our kids’ financial futures; we also need to be thinking about our parents’ financial futures.

Living at a time when fewer and fewer people can afford to live without working for their monthly income, we need to accept that we may need to help our parents with their expenses and living costs when they can no longer earn an income.

The good news is that it’s not just about shelling out more cash from our pockets; rather, it’s about building a collaborative and conversation-driven process to establish a healthier financial future for all involved.

The Real Simple lifestyle website offered several ways to start engaging with your parents on a journey of planning and providing for their senior years.

1. Talk to your parents about their money (but skip the blame game)
2. Get other family members on board.
3. Dig into financial details and get started on a budget.
4. Can you encourage them to consider phased retirement?
5. Look for new sources of income.

If you were lucky enough to have parents who were able to provide well for you, discovering that they haven’t saved for their golden years may be really tough to find out – but it’s better to find out now rather than later.

The fact is, what’s done is done. But it’s never too late to put a plan in place that allows you to find a way to help your parents without putting your own financial future at risk. When we bottle up our problems, they will make us sick and stifle any chance of growth or healing. If we are open to talking about tough subjects, we might find that our parents will also find it easier to open up.

In the first above, avoiding blaming or making anyone feel bad is crucial. It’s good to talk about how we’re feeling, and it’s okay if there are some negative emotions, but we have to be willing to move past those and focus on what will result in a positive outcome for all of us.

We spend most of our time having conversations with people who are 40+ about saving for retirement. However, the language and expectations are slowly starting to shift in a powerful and exciting direction.

Instead of only talking about retirement, we’re starting to use words like financial independence. And rather than focusing on traditional milestones, like 65+ years, we’re starting to look at shifting timelines based on goals and lifestyle plans that are based on purpose and meaning, not contracts and “having enough”.

Many of our chats are opening up the opportunity to discuss things like work-optional lives where we can look at taking a few years off, then working again, then taking a break again. Or, changing the pace of work and redefining what a valuable life looks like, meaning that we don’t have to stop working when we have a set amount saved or have reached a certain age.

Inevitably, these dialogues also allow the space to help our children with their own financial independence. When we’ve passed the 40-year-old mark, we realise the difference that 20 years makes on a lump sum investment. We can see that a small amount now can make a huge difference later, for our children.

Depending on where you or your kids live – you may be able to set up a tax-free saving account, and doing this will have multiple benefits for your children. The first benefit is the tax-free money your child will have access to. But, even if it’s not tax-free, another benefit is the early financial education they will receive, knowing that you’re putting away money for a long-term event horizon. They will see the investment steps and the results. 

And, they will benefit from the kickstart as they will be able to start their working life with money in their financial independence, or retirement account. Because they already have a good start, it is more likely that they will continue to invest.

Many countries offer tax-free savings accounts; whether you’re looking at a Roth IRA, an ISA, TFSA or something else – you can start a bolster fund for your kids that will gain immense value over 30 to 60 years, no matter where you or they live.

In a recent podcast on the Allan Gray Podcast with Dan Brocklemank, head of Orbis UK, he reflected on how humans are NOT designed to be good investors. Our natural instincts very often pull us in the exact opposite direction to what we need to be doing in order to be good at investing.

Our natural habits and instincts protect us in the present; they’re not good at protecting us for the future and seeing the bigger picture.

It’s partially why Warren Buffet once said that the most important quality for an investor is temperament, not intellect. It’s not always what we know in the here and now, but how we behave when we see others in a state of panic.

Throughout history, there have been bubbles in the markets that have incited irrational investor behaviour; everyone can see them happening, and yet they all buy, driving up the prices, even when the market value is radically out of sync.

It almost feels trite to repeat the saying that it’s all about time in the markets, not timing the markets, but it’s an old investment truth that still rings soundly, even in the current global environment.

Long-term investors have always had to make sense of a barrage of information, from market movements and geopolitical news to economic developments and personal finance trends.

With the digital age giving rise to a new culture of near-limitless access to information, this is now even more challenging.

If you’re looking to build and sustain a long-term wealth strategy, it’s helpful to have a long-term relationship with a financial planner who is willing to work closely with you to help you create and stick to your financial goals.

This is because, despite all our investing history and available technology, forecasters are still so bad at predicting what will happen tomorrow and why we still believe that the best way to build wealth is by adopting a long-term approach. Working with someone you know and trust, who can talk you out of a hole or off a ledge, is going to become paramount to growing a strong, robust investment portfolio.

So many things have changed in the last four decades, and yet so much has stayed the same. Financial planning has become an entire profession and is no longer just a bunch of salespeople selling insurance. It’s evolved into a profoundly nuanced practice, and those of us who are continually advancing our professional development are spending more time on understanding the integration of all aspects of life and well-being in our approach to financial planning.

But still, people are talking about retiring at 65 and asking how much money they will need. Forty years ago, the assumption was that at 55-65, you could comfortably retire if you had enough money to support yourself for another two decades.

Plans were made, and products were bought in order to see this happen, but forty years on, the landscape looks quite different to what was expected.

Yet still, people are talking about retiring at 65 and asking how much money they will need.

The Stanford Centre on Longevity recently stated that: “By the middle of this century, living to the age of 100 will become commonplace, continuing a remarkable trend that saw human life expectancies double between 1900 and 2000, increasing more in a single century than across all prior millennia of human evolution combined.”

And Aubrey de Grey, a British biomedical gerontologist living in the US, believes that the first person to live to 150 has already been born.

Wynand Gouws, the author of “Life to 100”, says that this continued increase in life expectancy is profound and should significantly impact how we think about life and retirement planning.

We can begin by reframing our thinking: instead of looking at retirement as our ‘last chapter’, we start to see that we could have two or three more chapters from 65 to 100. Gouws highlights that population ageing has been recognised as one of the four global demographic megatrends, next to population growth, international migration, and urbanisation, which will have a lasting impact on sustainable development.

As much as we’ve seen radical changes in recent history, we will most likely see even more change in the near future, which for many of us reading this, will see us entering our last few chapters of life. We don’t have to enter without a plan; we can celebrate our health and new opportunities, ensuring that we have an integrated financial plan.

As 22seven recently published on medium.com, “Always think twice before you buy something on credit or take out a loan.”

Here’s the thing to remember with credit – it’s just a nicer way of saying that you’re spending money you don’t have. In other words, you’re using someone else’s money to fund your current lifestyle. Credit is sold to us on the premise that it’s money we will have in the future, and often we do have the money in time and can pay it all back, but sometimes we don’t, and we just keep borrowing more. This is when we get stuck.

This continual servicing of debt becomes a hidden cost to our future self, and then the interest and account fees all start adding up, so we look for additional credit providers to help us. From banks to store credit, a recent US study showed that the average American debt (per U.S. adult) is $58,604 and 77% of households have at least some type of debt.

Whilst this will vary from region to region, country to country, it’s safe to assume that most people in today’s global economy have accepted credit to support their current living standard.

This is not necessarily wrong or right, but it’s something we have to talk about and know that we’re all in the same boat together. When we stifle conversations about money, we succumb to unhealthy thoughts and feelings about our financial situations that divide us rather than connect us.

So, before you take on any more credit, make sure you’ve given some thought to the following things:

1. Is my income enough to cover the full cost of this credit (not the items bought – credit will always cost more)
2. With inflation, will I still be able to pay for this credit comfortably?
3. If I had the cash available, would I still spend it on this (or these)
4. What are the extra costs, like card and account fees, interest, insurance etc

Credit has hidden financial costs, but it also has costs to our emotional, physical and mental wellbeing from the stress of creating too much debt. It’s hard to live without debt, but it’s not impossible to keep it to a manageable amount or reduce it entirely.