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Month: July 2021

Intergenerational Wealth – Securing your family’s financial future

What is Intergenerational Wealth Transfer?

We spend a lifetime generating wealth and assets, and it is therefore important to ensure that we pass wealth on to our next generation and beyond. The passing of wealth from one family generation to the next is known as intergenerational wealth transfer.

It is becoming more important than ever to consider succession and legacy planning as part of your overall financial planning strategy. Below we explore some of your options:

Intergenerational wealth transfer can be a huge issue for all family members concerned. If done well and executed properly, it can make a real difference to the financial position of the recipients. If misjudged or poorly handled, it can cause enormous issues, conflicts and resentments that are never forgotten nor forgiven.

Financial implications of Intergenerational Wealth Transfers

One aspect that should be thoroughly considered is the impact on family members, particularly the next generation, as parents think about selling up or passing down a business and entering retirement.

It is important that children are prepared to deal with this process, not least, so they are aware of how they may be affected and what may be expected of them. For instance, children may be expecting to receive a certain amount of money from their parents – particularly those who are selling a business – and end up disappointed, or on the other hand, may not feel responsible enough to take over a business.

Conversely, they may not be expecting to receive anything, and are therefore not equipped to deal with a substantial windfall. Transparency is key when it comes to generational wealth.

Contributory factors of intergenerational wealth transfer management

For those approaching, or in, retirement, it’s important to have frank and open conversations with children about expectations, and whether children have the knowledge and understanding to manage financial matters and how they feel about inheriting a business and/or wealth.

How to deal with approaching retirement

Many families experience a jaw drop moment when their children are exposed to what their parents have been able to achieve financially. Many want to learn from their parents to be in the same position as them in the future.

Although, it is important to remember that we work our whole lives to provide the best for our family and leave behind our legacy. Although you should not feel as though your family are solely reliant on you for their financial situation. It is important to teach your children work ethic, and not simply let them believe they can fall back on the bank of mum and dad. After all, it’s called legacy planning, with the idea of leaving behind a long-lasting legacy of wealth to last your family generations to come.

Expressing financial wishes

The best approach to help your children establish a strong financial foundation to prepare them for intergenerational wealth transfer, is to introduce them to your professional advisers as soon as they reach early adulthood. This can give them comfort knowing that they have someone to turn to for financial advice, and piece of mind someone is there to support their finances with their best interest at heart, should you no longer be around. Open communication and expressing your goals will also ensure your family is all on the same path to success. This can also squash the possibilities of conflict when managing intergenerational wealth after your passing.

Some questions you should ask yourself before starting the intergenerational wealth transfer planning process include:

  • When did wealth enter your life, and how do you imagine this timing influences your values and family relationships?
  • What impact does affluence have on your life and the lives of your next generation?
  • What was the key to success in creating wealth, and how might telling this story to your future generation be helpful?
  • What is your biggest concern in raising your children or grandchildren with affluence?
  • What conversations (if any) did you have with your parents about money and wealth growing up?
  • How did your parents prepare you to receive wealth, if you did?
  • What lessons did you learn from your parents about money and finances you would like to pass on to your heirs?
  • What family values would you like to pass down to the next generation, and how do you plan on communicating this family legacy?
  • What concerns do you have about your adult children when it comes to inheriting and managing the family wealth?
  • How can you help prepare your beneficiaries to receive wealth and carry on your family legacy?

The passing of wealth between generations

Many children who are set for vast sums of inheritance can end up becoming over-reliant on their expected windfall. It is important to get the younger generations involved in your business and finances. Teach them how to handle the wealth and responsibilities they will be inheriting, as well as equipping them with advice and professionals who can help them to make wise decisions about the wealth they generate themselves, when you’re no longer here.

Click here to schedule a no obligation initial consultation with one of our advisors.

Lawsons Equity – Financial Planning Malta

Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.

The value of investments and income from them may go down. You may not get back the original amount invested.

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994.

Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries click here.

16th – 23rd July 2021

Market Update

Equities in Europe rose on optimism about the upcoming corporate earnings season and the European Central Bank’s (ECB) reaffirmation of its pacifistic monetary policies. These tailwinds helped reverse early weakness, resulting from fears that the spread of the delta variant of the coronavirus could prolong a global economic recovery. In local currency terms, the pan-European STOXX Europe 600 Index ended 1.49% higher. The main European stock indexes also gained, with France’s CAC 40 Index up 1.68%, Italy’s FTSE MIB Index advancing 1.34%, and Germany’s Xetra DAX Index adding 0.83%. The UK’s FTSE 100 Index ticked up 0.28%.

Core eurozone government bond yields fell. Worries about the spread of the coronavirus and the ECB, which reiterated its view that inflationary pressures should prove transitory, contributed to demand for high-quality government bonds. Peripheral eurozone bond yields largely tracked core markets. UK gilt yields fluctuated, as surging coronavirus cases spurred flows into bonds midway through the week.

The ECB kept its key policy measures unchanged, but revised its forward guidance, indicating it would keep interest rates “at their present or lower levels until it sees inflation reaching 2% well ahead of the end of its projection horizon and durably for the rest of the projection horizon, and it judges that progress in underlying inflation is sufficiently advanced to be consistent with inflation stabilising at 2% over the medium term.” The ECB indicated this process could involve a short period in which inflation goes moderately above this target.

US stocks ended the week higher, rebounding from a sell-off on Monday. The advance was somewhat narrow, however, with much of the gains concentrated in technology and internet-related giants– the so-called FANG+ stocks.

U.S. Treasury yields followed a similar pattern to the equity benchmarks. Growing fears surrounding the delta variant spurred a steep decline in the benchmark 10-year Treasury note yield at the start of the week, which was exacerbated by technical trading factors that pushed long-term yields on Tuesday morning to their lowest levels since early February. (Bond prices and yields move in opposite directions.) Yields quickly retraced earlier moves, as worries over potential lockdowns in the U.S. eased, and demand for new issuance of investment-grade mortgage-backed securities and corporate bonds appeared to pull some investors away from Treasuries.

Japan’s stock markets closed in negative territory on Wednesday, ahead of a long weekend that marked the start of the Tokyo Olympics. The Nikkei 225 Index was down 1.63%, and the broader TOPIX Index fell 1.44%. Concerns that the Olympic games would worsen the country’s COVID-19 outbreak weighed on markets. News that support for Prime Minister Yoshihide Suga’s cabinet slid to its lowest level since he took office in September last year also dampened sentiment. The yield on the 10-year Japanese government bond fell to 0.016%, while the yen depreciated slightly to 110.45 against the U.S. dollar.

Chinese stocks recorded a mixed week. The Shanghai Composite Index rose 0.3% and outpaced the large-cap CSI 300 Index, which declined 0.1%, according to Reuters. Bond yields moved lower, as the yield on the 10-year sovereign bond shed 4 basis points to end the week at 2.93%. In currency markets, the Renminbi edged up 0.2% to close at 6.47 against the U.S. dollar.

Oil prices gained ground, rebounding the slide after OPEC+ agreed to ease its production cap over the next year or more. Brent crude oil is trading at USD 72.07 a barrel, easing in the afternoon and after-hours Friday. It was up 0.2% for the session and 0.4% for the week. Brent crude settled at $74.09 a barrel to be up around 1.2% for the week.

Gold remained over the $US1,800 mark, but is struggling to build positive momentum, given every opportunity by the rise of the new Delta Covid variant.

Lawsons Equity – Financial Planning Malta

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994. Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries, click here.

9th July – 16th July 2021

Market Update

Equities in Europe fell on worries the rise in coronavirus cases could hinder economic recovery. Some market participants are also concerned that central banks may tighten monetary policy sooner than expected to subdue inflation. In local currency terms, the pan-European STOXX Europe 600 Index ended the week 0.64% lower. Major European stock indexes also dropped. France’s CAC 40 Index slid 1.06%, Italy’s FTSE MIB Index slipped 1.03%, and Germany’s Xetra DAX Index weakened 0.94%. The UK’s FTSE 100 Index fell 1.60%.

Core eurozone government bond yields dropped, mostly tracking the move in U.S. Treasury yields, as U.S. Federal Reserve and European Central Bank (ECB) officials reaffirmed the view that inflationary pressures would prove transitory. Concerns about the rapidly spreading delta variant of the coronavirus also weighed on yields. Peripheral eurozone bond yields broadly tracked core markets. UK gilt yields ended roughly flat, as higher-than-expected inflation and hawkish commentary from two Bank of England policymakers offset some downward pressure on yields from the move in U.S. Treasuries.

The major US indexes ended lower, but the S&P 500 Index and Nasdaq Composite reached new intraday highs at midweek before falling back. The small-cap Russell 2000 Index underperformed for the third consecutive week, further giving up its leadership over the large-cap S&P 500 Index for the year-to-date period.

The yield on the benchmark 10-year U.S. Treasury note jumped briefly following the release of the retail sales data, but ended lower for the week. (Bond prices and yields move in opposite directions.) Despite the rally in Treasuries, the broad municipal bond market was little changed over most of the week.

Japan’s stock markets registered modest gains for the week, with the Nikkei 225 Index up 0.22% and the broader TOPIX Index gaining 1.04%. Tokyo was placed under its fourth coronavirus state of emergency, lasting until August 22 and covering the duration of the Olympic Games, as part of the government’s efforts to contain a resurgence in COVID-19 infections. The capital registered its highest daily count in new cases since January during the week. Against this backdrop, the yield on the 10-year Japanese government bond fell slightly to 0.02%, while the yen was broadly unchanged at JPY 110.04 against the U.S. dollar.

In a choppy week, the Shanghai Composite Index and large-cap CSI 300 Index rose by 0.4% and 0.5%, respectively. Markets showed relief after China’s second-quarter gross domestic product (GDP) report on Thursday was in line with expectations. China’s bond market recorded inflows of USD 10 billion in June. The yield on the 10-year government bond fell five basis points to 2.97%, marking the first time since August 2020 it fell below 3.0%. In currency markets, the Renminbi was little changed and closed at 6.471 versus the U.S. dollar.

OPEC+ ministers were due to meet overnight Sunday (Sydney time) to break the deadlock and try on a new output policy between Saudi Arabia and their smaller Gulf rivals, the United Arab Emirates (UAE). Ahead of that news emerging at the weekend, Brent crude settled down 12 cents at $73.59 a barrel on Friday, while in New York West Texas Intermediate (WTI), crude rose 16 cents to settle at the end of the week at $71.81 a barrel.

West Texas Intermediate fell around 4%, and Brent crude dipped 3% in what were the largest falls for five months, as nervousness about the lack of a deal on a new production cap rattled confidence.

Gold fell by $14 an ounce to $1,815 an ounce, and continued to fall in late trading to around $1,812. That still left gold up 0.2% for the week, but there’s a chance the price will slide again, with more attention focused on rising Covid Delta infections.

Lawsons Equity – Financial Planning Malta

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994. Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries, click here.

Is it ever too late to start saving for your pension?

It’s never too late. You can take charge of your finances in preparation for retirement at any age. We have put together some points to consider when saving for your pension after your thirties.

We all want to spend our later life doing what we love without financial worries, right? The best way to ensure this is to start putting money aside as young as possible. But it’s not everyone’s priority in their twenties to start building their pension pot. If you didn’t manage to save in your twenties, thirties, or even forties then that is absolutely fine. It’s not too late to reach your retirement goals.

Even if you’re now in your forties, fifties or even sixties, there is still time to build a substantial retirement fund. We’re not saying it’s going to be easy to catch up, but with a solid plan in place and some real discipline and dedication to your savings, you can backtrack on your mistake to not start earlier. So, where should I start? You may be asking. There is no one strategy that meets everyone’s needs – the path you need depends on your age, finances and personal circumstances. We have some points you may want to consider if you want the pension pot you’ve been dreaming about:

Check on your state pension

The best place to start is to check your state pension. If you’ve been working all your life, the chances are you already have a pension pot. Your forties are a great time to check if you’re on top of your pension contributions. If you’re not, it’s time to catch up. As you get older and reach your fifties and sixties, it can become more difficult to catch up with state contributions.

Could you consolidate your workplace pensions?

Do you know how many workplace pension pots you have contributed to? Who are they with and how much is in each? It’s time to locate them and check how much you have saved in total. It may not be a life changing sum, but it all counts and could be consolidated into one place to make them easier and maybe even cheaper to manage.

Something else to consider is that if your financial situation is better now than in your earlier working years, you could start to make larger contributions. Saving more in your workplace pension can help boost and maximise your future pension pot.

Set up a personal pension

Maximising your state and workplace pensions is a great thing, but it may not be enough to ensure you reach your desired retirement target. If you’re between your forties and sixties and haven’t got much put aside for retirement, you need to broaden your options. A private pension will allow you to take control of your retirement and boost your savings. The best part is with a personal pension, you can choose how much you put aside, whether it’s £100 a month or £10,000 as a lump sum. The other benefit of a personal pension is that it allows you to make contributions until the age of 75, which could give you some extra time to save for your retirement.

Opening a personal pension can feel like a big job, but it doesn’t have to be. Our team is here to help you choose how much you should invest, and the risk level that suits your needs, depending on where you are in life and where you want to be by retirement age. We’ll do the hard work for you, and by this, we mean we’ll pick your investments and manage your pension continuously, so it remains on track with your investment style.

Consider upping your investment risk

If you’re now in later life and only just starting saving for retirement, it’s a good idea to think about your appetite for investment risk. It’s always up to you to decide how much risk you’re willing to take. But you may want a professional to review your financial situation, your timeframe, and your risk appetite to give you the best possible chance of reaching your retirement goals. If you feel confused and need help, it’s always a good idea to contact a financial adviser.

How much do you want to save?

As you approach retirement, if circumstances allow, you may want to increase your contributions to maximise your pension pot. Typically, the longer you wait to save, the more you may need to pay to catch up and reach your retirement goal. But don’t worry, this doesn’t mean you’ll need to put in thousands at once. A good way to build wealth for your later life is to regularly make sizable contributions. And if you can afford it, you could try and pay a bit more. It doesn’t have to be a huge increase. Adding an extra €10 or €20 to your monthly contributions could make a huge difference over time due to compounding.

Whatever you decide to put in your pension, the most important thing is to get started. If you want to ensure you live the retirement of dreams, the earlier you start, the better.

Click here to schedule a no obligation initial consultation with one of our advisors.

Lawsons Equity – Financial Planning Malta

Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.

The value of investments and income from them may go down. You may not get back the original amount invested.

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994.

Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries click here.

2nd July – 9th July 2021

Market Update

Shares in Europe ended little changed, recovering from a sharp pullback stemming from worries that a surge in coronavirus cases might hinder global economic growth. In local currency terms, the pan-European STOXX Europe 600 Index ended the week 0.19% higher. Major indexes were mixed. Germany’s Xetra DAX Index ticked up 0.24%, France’s CAC 40 Index declined 0.36%, and Italy’s FTSE MIB Index dropped 0.91%. The UK’s FTSE 100 Index ended the week flat.

Core eurozone bond yields tracked U.S. Treasury yields lower as global bonds rallied. The swift spread of the delta variant of the coronavirus and weak U.S. services activity data stimulated concerns about the economic outlook and drove demand for high-quality government bonds, pushing yields lower. Peripheral eurozone government bonds and UK gilts largely tracked core markets this week.

The major US benchmarks closed mixed, with large-caps and growth stocks outperforming for the second consecutive week. Within the S&P 500 Index, the interest rate-sensitive real estate sector performed best, as longer-term Treasury yields decreased sharply. Energy stocks fared the worst on worries that disagreements among major oil producers would result in some violating output restrictions. Weakness among media firms also weighed on the communication services sector. Markets were closed Monday in observance of Independence Day.

The major driver of sentiment during the week appeared to be the steep decline in U.S. Treasury yields, with the yield on the benchmark 10-year Treasury note hitting a nearly five-month low on Thursday. The 10-year Treasury note yield sank to 1.25% in intraday trading on Thursday, before partially retracing earlier moves.

The European Central Bank (ECB) adopted a 2% inflation target over the medium term– discarding the previous objective of “below, but close to, 2%”– after reviewing its strategy. ECB President Christine Lagarde said the new target meant the central bank “considers positive and negative deviations of inflation from the target equally undesirable.” She said the ECB would use “persistent or especially forceful monetary policy action” when interest rates are close to their lower limit and inflation remains below its target. The shift “may also imply a transitory period in which inflation is moderately above the target.” Lagarde said the new strategy was “quite squarely” not the same as the U.S. Federal Reserve’s average inflation policy.

Japan’s stock markets noted sharp losses for the week, with the Nikkei 225 Index falling 2.93% and the broader TOPIX Index down 2.25%. Concerns dampened sentiment that the spread of the delta variant of the coronavirus would stall a global economic recovery. The yield on the 10-year Japanese government bond pulled back to 0.03% amid expectations that major central banks will not tighten monetary policy any time soon, while the pandemic continues to pose risks to growth. The yen strengthened to JPY 110.01 against the U.S. dollar on safe-haven demand.

Chinese stocks were mixed for the week, with the benchmark Shanghai Composite Index edging slightly higher and the large-cap CSI 300 Index recording a modest loss. Selling was pronounced in technology stocks amid heightened regulatory risk on reports that Beijing will tighten oversight of U.S.-listed Chinese companies, many of which are in the tech sector, as well as the government’s continued crackdown on domestic tech companies. For the week, the yield on China’s 10-year sovereign bond fell eight basis points to 3.02%. The Renminbi currency shed 0.2% to close at 6.487 against the U.S. dollar.

In commodities, Brent crude oil futures were up $1.43 or 1.93%, at $75.55. US West Texas Intermediate futures were up $1.62, or 2.2%, at $74.56. Prices on both sides of the Atlantic ended the week little changed, despite significant daily fluctuations.

Gold gained 0.6% to $1,810.60 an ounce, silver rose 0.4% to $26.25 an ounce, and copper surged 1.9% to $4.34 a pound. That’s the first time in three weeks that gold has climbed over and ended above $1,800 an ounce. That left the metal up 1.8% for the week.

Lawsons Equity – Financial Planning Malta

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994. Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries, click here.

25th June – 2nd July 2021

Market Update

Equities in Europe were slightly down on concerns that inflationary pressures may advance interest rate increases. An additional headwind was the spread of a highly infectious variant of the novel coronavirus, which shadowed the outlook for an economic recovery. In local currency terms, the pan-European STOXX Europe 600 Index slipped 0.18%. Major indexes were mixed.

Germany’s Xetra DAX Index rose 0.27%, while France’s CAC 40 Index fell 1.06%, and Italy’s FTSE MIB Index declined 0.89%. The UK’s FTSE 100 Index gave up 0.18% of its value.

Core eurozone government bond yields fell, reflecting increasing fears about the spread of the delta variant of the coronavirus in Europe. Comments from European Central Bank (ECB) President Christine Lagarde highlighting the risk of virus variants and their potential effects on the Eurozone economic recovery also weighed on yields. Peripheral bond yields broadly tracked core markets.

UK gilt yields similarly fell in tandem with core markets. Bank of England Governor Andrew Bailey restated the view that the uptick in UK inflation would prove transitory appeared to contribute to the decline in gilt yields.

The S&P 500 Index and Nasdaq Composite Index moved to new highs and closed out a fifth consecutive quarterly advance. Large-cap growth stocks led the gains, with the Russell 1000 Growth Index stretching its weekly winning streak to eight. Technology and health care stocks led the gains within the S&P 500, and consumer discretionary stocks were also strong, boosted by a solid rise in Nike shares. Small- and mid-caps underperformed after strong gains the previous week.

Japan’s stock market returns were negative for the week, as concerns about rebounding coronavirus infection rates eroded optimism about progress in the country’s vaccination drive.

The Nikkei 225 Index fell 0.97%, while the broader TOPIX Index finished 0.32% lower. The yen weakened to its lowest level since February 2020, closing the week at JPY 111.43 against the U.S. dollar. The yield on the Japanese 10-year government bond declined to 0.046%.

Chinese stocks fell for the week. Both the Shanghai Composite Index and large-cap CSI 300 Index posted a weekly loss after each index recorded its biggest one-day percentage drop since early March on Friday, Reuters reported.

Bond yields were unchanged for the week, with the yield on the 10-year sovereign bond ending at 3.10%. In currency trading, the Renminbi shed 0.4% against the U.S. dollar to RMB 6.479 per dollar.

OPEC and non-OPEC ministers (led by Russia) finished Friday’s virtual meeting without a resolution. The lack of agreement didn’t worry oil markets all that much. Brent crude settled up 33 cents, or 0.44% at $76.03, and US West Texas Intermediate (WTI) crude settled down 7 cents, or 0.09% at $75.16. That left Brent up 0.9% for the week and WTI up 1.6%.

Gold and silver continue to move sideways despite the solid jobs report for June and higher wages. Gold rose 0.4% to $1,783.30 an ounce, and then rose in after-hours trading to around $1,787 an ounce, leading to faint hopes of regaining $1,800 this week.

Lawsons Equity – Financial Advisors Malta

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994. Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries, click here.

Saving with irregular earnings

If you have irregular monthly earnings, then how you save and budget for the long term is all in your preparation.

If you are self-employed or a freelancer, you will likely have irregular earnings. Meaning it can sometimes be a little difficult to save and budget, especially when most advice readily available is tailored to salaried earnings.

It’s important to find an approach to saving that works for you and your financial circumstances. This approach should be tailored to how much you are paid and when. In the long run, if you’re prepared to take a more forward thinking approach to saving, it will help you build a better relationship with your finances and not leave you in any sticky financial situations.

First, work out your essentials

Before you even think about budgets and saving plans, you need to know how much you spend on essentials. Just because you earn a different amount monthly, your essential outgoings will remain around the same each month. Think about things like:

  • Mortgage or rent
  • Utility, internet, tv bills etc
  • Travel costs
  • Food shopping
  • Insurance

Add them up and total your essential outgoings.

Secondly, work out what is left over

After you know your essential outgoings, you can work out what you have leftover each month.

Due to your irregular earnings, the amount you have left over will likely change monthly, so it is important to be flexible with your savings and take an active approach to how much you choose to save and when. You should study every paycheck so that you know how much you will have leftover after your essential outgoings have been paid. It’s a great idea to save a percentage of your leftover money each month. This is a great technique to save consistently, realistically and not leave yourself out of pocket.

Time to work out your budget

Knowing what is left is good, but without a budget it can be easy to burn through what’s left. Budgets allow you to maximise how far your money can take you.

With an irregular income, you might want to consider budgeting for your lowest monthly income, as these are the times that you are likely to be the lightest on cash. This will help cover your major costs and make it easier to increase in months when you have more money.

If your money changes significantly seasonally or on a job-by-job basis, you may want to make a budget by dividing your annual income by 12.

Think ahead

If you are self-employed or have significant seasonal changes, it is important to think ahead. Budgeting can give an idea of how long money might last, but you will also have to consider other events in the year when your outgoings may be higher, like Christmas, annual bills or birthdays.

If your income is irregular, planning for much longer periods can actually be easier than trying to condense on a monthly basis. It might be worth planning your payment pattern, for example holding back money for bills later in the year, investing more in your emergency savings, or even raising your pension payments for a few months of the year.

If one month you have higher earnings, think forward to ensure you will be comfortable all year round before splurging.

Split it up

Psychologically, it is much easier to spend money when you can see it sitting in your current account. If you fall victim to this, it may be a good idea to set up a seperate savings account.

It’s a great time to start investing as most high-street savings accounts currently offer low interest rates. But as you build up your wealth you should explore wealth management options and look to diversify your portfolio. Money makes money – but it doesn’t if it’s sitting in a stagnant account.

Set some goals

Saving to simply save can be disheartening. Why not set yourself a few goals?

You might also want to save for certain things, like holidays, new cars or refurbishment, or perhaps even put money away for your retirement. What you save for and how you save is up to you, but setting achievable goals can help you get there faster.

Build in a buffer

With irregular incomes, a cash buffer can be a lifesaver, especially as you may go for a few months without being paid or with lower pay than expected. Normally, it is recommended that people build an emergency fund that can pay between three and six months of bills. Although if you have irregular income, you may want to increase this amount to up to 12 months, as this pot is your plan B if money is slow or something bad happens.

Likewise, a substantial cash buffer could allow you to balance your monthly payments.

Find a place for your extra cash.

If you save regularly, you can build up more money than you need, which means you could be looking for somewhere to put it to work even harder. You may be thinking about investing to unlock more potential from your money.

We can take the stress out of investing and help you decide how much you should invest, and choose investment styles that fit your risk appetite. We’re here to ensure your saving and investment journey works around your irregular income pattern.

Click here to schedule a no obligation initial consultation with one of our advisors.

Lawsons Equity – Independent Financial Advisors Malta

Information is based on our current understanding of taxation legislation and regulations. Any levels and bases of, and reliefs from, taxation are subject to change.

The value of investments and income from them may go down. You may not get back the original amount invested.

Lawsons Equity Limited is a company registered in Malta with company number C49564 and licensed by the Malta Financial Services Authority as Enrolled Insurance Brokers under the Insurance Intermediaries Act 2006, and to provide Investment Services under the Investment Services Act, 1994.

Lawsons Equity Ltd have passported their services across the EU. To see a full list of countries click here.

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