Hall

Everyone has a dream of being secure financially and retiring comfortably. Make yours a reality!

BPM Financial Limited offers a full range of financial services and investment advice to individual investors and institutions. The company seeks to empower its clients, offering a range of products to meet the needs of those persons just starting their first jobs, those who are in their peak working years or those persons nearing retirement or living in retirement.

WHY IS IT IMPORTANT FOR WOMEN TO INVEST?

Women are now living longer than men and, as a result, many women have begun to outlive their spouses. More women need to start thinking about funding their own retirement packages independently of men or their spouses. This issue needs to be seriously addressed from a financial perspective.

Peta-Rose Hall, managing director of BPM Financial, notes that while women are living longer, many are not saving enough. "When you think about it," says Hall, "many women interrupt their careers to have children, or take care of other family members, and because of that they work fewer years and thus save less."

Other issue which affect women:

Many women work on contract and thus do not have benefits. One important benefit is that of being able to put some amount away in a retirement account on a monthly basis.

Women tend not to pursue their careers as aggressively as men, as they are rearing children. They don't get to the boardroom and they don't earn top dollar or as much as their male counterparts.

By and large, women invest more conservatively than men - earning lower rates of return on their investments over time. The end result is that their retirement savings grow slowly and does not keep up with inflation.

When individuals change jobs, they rarely ask for the pension to be transferred to the new employer's pension fund. People take refunds of contributions and end up spending it. (Both men and women do this).

"It is important for women to save regularly and to invest their savings to meet short-term needs and medium and long-term goals," continues Hall. "When you invest, you are trying to increase and build the value of your assets. Done wisely, it can help you meet your financial goals."

There are a number of factors which affect the value of investments, with inflation being one of the most important. Inflation is a sustained increase in the general level of prices for goods and services. When inflation goes up, there is a decline in the purchasing power of money. Other factors that must also be considered are devaluation, fluctuation in foreign exchange rates and taxes.

INVESTMENT BASICS

There are three basic investment categories - stocks, bonds and cash.

Stocks are ownership shares which investors buy in a corporation.

Cash investments include money in bank accounts, (CDs), etc.

Bonds are loans investors make to corporations and governments.

CHOOSING THE BEST INVESTMENT

A number of questions can help you to choose the best investment for your needs:

Is the investment low risk or high risk?

Will my investment be short, medium or long term?

What are the benefits? For example, what are the returns or the tax advantages?

What type of investor am I?

1. Conservative: Low risk tolerance. You are quite comfortable earning a fixed rate of interest.

2. Moderate: You understand that some risk drives your portfolio, hence more attractive returns.

3. Aggressive: You want the maximum return for your invested dollars. You invest for the long term and can recover any losses.

Wealth-Creation Process

1) Determine current situation

2) Set goals

3) Establish customised plan

4) Start investing

5) Conduct periodic review.

It is also important to consider the life stage that you are at:

Recent graduates/first job

It is crucial to start your financial planning so as to create wealth early. Recent graduates should start financial planning in the early working years, giving your investments time to grow through compounding. Assumptions about future inflation and future investment returns have to be made in order to estimate what the future value of your retirement fund will be.

Investments to consider: Treasury bills, LRS, stocks and mutual funds.

Professionals

At this stage you may have been employed for at least 10 years, earning a satisfactory income level to cover your expenses. Wealth management is key and you should have an emergency fund of approximately six to eight months salary for basic living expenses and emergencies. These are the years to be more aggressive in securing your financial goals.

In your peak working years, it is important not to invest too conservatively. Don't be afraid to go for growth. Invest in stocks and real estate as much as you can, and allow your money to give you real returns against inflation. The market will be up and down, but you will have time to recover. Investments to consider: Mix of mutual funds and direct investments in equity.

Top Executives

These are your peak career years and objectives should include wealth protection - securing your retirement and perhaps preparing for your children's future.

Investments to consider: Portfolio of local and foreign-currency investments.

Retiree

Your accumulated asset base must be guarded and should be generating consistent growth. If you have invested wisely, you should be able to travel, pursue hobbies, enjoy your day-to-day living and leave a fine legacy for your children and grandchildren.

Investments to consider: A mix of money market funds, tax-free investments and foreign-currency denominated investments.

WHAT IS THE ROLE OF BPM FINANCIAL?

Guide individuals in developing their customised investment plan.

Pension fund investment and administration services for institutions.

Provide investment advice on retirement planning.

BPM FINANCIAL INVESTMENT PRODUCTS

Nest-Egg Investor Account - tax-free if principal is held for five years.

Fixed Income J$ Portfolio Account - lower risk and consistently good returns.

Equity Portfolio Account - for the long term and earns superior returns.

Balanced Portfolio Account - a mix of stocks and risk-free government bonds which give a good overall return.

Pension Fund Management - portfolios suited to the needs of individual funds.

US$ Maximiser - which allows you to build, using manageable amounts.

How far away are you from your objectives?

Let BPM Financial help you to consider your risk tolerance, provide advice and develop a customised investment plan for your individual needs.

Peta-Rose Hall is a certified investment manager and is currently managing director of BPM Financial Ltd. During her 27-year career with the Barita Group of Companies, she has developed tremendous expertise in teaching clients - who have small amounts to invest but have a desire to build their assets and create wealth - how to accumulate, invest and build their portfolios. She is a founding member of the Pension Funds Association of Jamaica and sits on the executive.

'In your peak working years, it is important not to invest too conservatively. Don't be afraid to go for growth.'