Tag: financialplanning

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Protection

Creating a Financial Legacy: Wealth Preservation Strategies

Legacy
ecology, family and environment concept - close up of father's and girl's hands holding tree over green natural background

Creating a Financial Legacy: Wealth Preservation Strategies

“What impact are you making, not only today, but for eternity? What impact are you making to leave a legacy?” ― Kirk Cousins

3 min read

Legacy

Creating a Financial Legacy: Wealth Preservation Strategies

“What impact are you making, not only today, but for eternity? What impact are you making to leave a legacy?” ― Kirk Cousins

3 min read

Preserving and growing your wealth is a key aspect of financial planning, but it’s often overlooked in the quest for immediate financial success. We here to share with you the strategies you can implement to safeguard your wealth for future generations and create a lasting financial legacy.

Building a Strong Foundation for Your Legacy

Creating a robust financial legacy begins with asset diversification. Diversifying your investments by spreading them across different asset classes, such as stocks, bonds, real estate, and alternative investments, is the cornerstone of a successful wealth preservation strategy. Diversification helps reduce risk, ensuring your wealth remains stable and has the best possible chance of growing over the long term.

Diversification provides a cushion against market volatility. When one asset class performs poorly, others may thrive, helping balance your overall portfolio. The essence of diversification is not only to optimise returns but, as mentioned, to minimise risk. By utilising this strategy, you’re not putting all your eggs in one basket.

Moreover, asset diversification isn’t a one-size-fits-all approach. It’s an art as much as it is a science. Whether you’re more risk-averse or an adventurous investor, tailor your diversification to your specific financial objectives. Understanding the nuances of each asset class and how they interact will be key in your journey to fortify your legacy.

Ensuring a Smooth Transition of Your Wealth

Estate planning is the linchpin in safeguarding your wealth for the next generation. It involves creating a comprehensive plan for the distribution of your assets, establishing trusts, and designating beneficiaries. These steps can significantly minimise inheritance disputes and potential tax liabilities, ensuring a seamless transition of your wealth.

In estate planning, understanding the intricacies of wills and trusts is essential. It’s not just about deciding who gets what but also about how and when. Estate planning can include setting up revocable living trusts to avoid probate, creating irrevocable trusts for specific purposes, and assigning powers of attorney.

In reality, this does require more than just creating a will or setting up trusts. You must consider how assets will be distributed, when they will be made available, and how your financial affairs will be managed should you become incapacitated. Estate planning is akin to orchestrating a flawless performance – each instrument (or legal document) plays a crucial role in the grand finale.

Keeping More of Your Wealth Intact

Whilst taxes are inevitable, overpaying them isn’t. Tax optimisation is like navigating through a complex maze of financial regulations, aiming to preserve your wealth. It’s not about evading taxes but rather strategically managing them. Think of it as finding the most efficient route through the maze, where every legal deduction and tax-advantaged account is a valuable shortcut.

By mastering the art of tax optimisation, or indeed speaking with a professional, you can legally reduce your tax obligations. This means keeping more of your wealth intact and in your pocket, channeling it towards your financial legacy rather than into the government’s coffers. Whether it’s optimising your investments for tax efficiency or understanding tax-advantaged retirement accounts, the goal is to be a savvy traveler in the labyrinth of tax regulations.

A Legacy Beyond Your Family and Community

Charitable giving transforms your financial legacy into a force for good. It’s like planting seeds of prosperity in various communities, fostering growth that extends far beyond your immediate family. When you contribute to charitable causes, you create a legacy that radiates a sense of responsibility towards society and its well-being. It’s about participating in a shared journey towards a brighter future.

Charitable giving comes in various forms, each with its unique advantages. From donor-advised funds, which provide flexibility and control, to private foundations that offer an enduring philanthropic structure, your options are diverse. We’ll explore these avenues to ensure your wealth leaves a lasting impact and echoes your values, even beyond your lifetime.

Empowering the Next Generation

The baton is passed, but it’s essential that the next generation knows how to run the race. Providing your heirs with financial education is akin to imparting the wisdom of the ages, ensuring your legacy is in capable hands. You’re not merely transferring assets; you’re passing on knowledge – knowledge that empowers your heirs to be responsible stewards of your wealth.

This section isn’t just about discussing financial literacy; it’s about actively engaging in the process. Initiating conversations about money and creating a structured educational program are as important as setting up trusts. By equipping your heirs with the tools, resources, and wisdom to manage their finances, you cultivate a sense of responsibility that extends well into the future.

Staying Agile in an Ever-Changing Financial Landscape

Just as the world evolves, your wealth preservation strategy must adapt. Regular reviews and adjustments are the lifeblood of your financial legacy. Consider it as steering a ship through uncharted waters. Periodic reviews aren’t just about checking off a list; they’re about assessing the changing winds and currents in the financial landscape.

Remaining agile means you’re well-prepared for unexpected shifts. It’s about being proactive and not reactive. This final section isn’t just about acknowledging the necessity of reviews; it’s about embracing them as an integral part of your financial journey. Staying ahead in the ever-evolving financial landscape ensures your legacy retains its vitality, remaining as enduring as the principles it stands on.

Patterson Mills are your reliable partner to ensure your wealth passes through the generations with ease. Get in touch with us today and book your initial, no-cost and no-obligation meeting, you and your family will be pleased that you did. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

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News

Breaking Barriers: A History of Women in Finance

Women in Finance

Breaking Barriers: A History of Women in Finance

“Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver” ― Ayn Rand

3 min read

Women in Finance

Breaking Barriers: A History of Women in Finance

“Money is only a tool. It will take you wherever you wish, but it will not replace you as the driver” ― Ayn Rand

3 min read

The world of finance has long been dominated by men, but the tide has been changing. Throughout history, remarkable women have broken down barriers, shattered glass ceilings, and made significant contributions to the field of finance. Today, we are talking about the inspiring history of women in finance, highlighting their struggles and triumphs in this dynamic industry.

Pioneers of Early Finance

In the late 19th and early 20th centuries, women like Hetty Green and Victoria Woodhull were trailblazers in finance. Hetty Green, known as the “Witch of Wall Street,” became one of the wealthiest women of her time, proving that gender was no obstacle to financial success. Victoria Woodhull was not only a pioneering stockbroker but also the first woman to run for president in the United States.

Alongside her sister, Tennessee Claflin, she opened the first female-owned brokerage firm on Wall Street. Their audacious presence in the male-dominated financial district was groundbreaking. Whilst they faced immense adversity, their determination laid the foundation for future women in finance to shatter the glass ceiling.

The Rise of Women on Wall Street

As the financial industry evolved, women made their mark on Wall Street. In the 1960s, Muriel “Mickie” Siebert became the first woman to buy a seat on the New York Stock Exchange (NYSE), challenging the male-dominated status quo. Her historic achievement paved the way for future generations of female finance professionals. 

After earning her place on the NYSE, Siebert continued to break ground. She founded her brokerage firm, Muriel F. Siebert & Co., in 1969. The company was one of the first female-owned brokerages, offering financial services to both institutional and retail clients. This bold move not only demonstrated Siebert’s determination to succeed but also her commitment to creating opportunities for other women in finance.

She was also known for her active involvement in politics, serving as the first woman to hold the position of New York State Superintendent of Banks from 1977 to 1982. Her role in financial regulation ensured that New York’s banking institutions operated effectively and responsibly.

The Feminine Influence on Investment

Women have also played a crucial role in shaping investment strategies. In the 1960s, Ann Hopkins helped pioneer the field of modern portfolio management. Her work on diversification and risk laid the groundwork for modern investment theory. 

Similarly, Elaine Garzarelli, renowned for predicting the 1987 stock market crash, demonstrated that financial acumen knows no gender. Her innovative approach to analysing market trends became instrumental for investors seeking to navigate the complexities of the stock market. Garzarelli’s successful career underscored the need for a diverse and inclusive finance industry that harnesses the skills and talents of women to drive innovation.

The 1960s to 2023

In the 1960s, women’s participation and representation in the finance industry was extremely limited. The 1960s marked the beginning of a gradual shift towards greater gender diversity in the industry, thanks in part to pioneering women like we have mentioned, such as Muriel Siebert, who fought to break through gender barriers.

Fast forward to 2023, for example, and there has been a significant increase in the representation of women in the finance sector, though disparities still exist.

Today, women like Abigail Johnson (CEO of Fidelity Investments and granddaughter of late Edward C. Johnson II, the founder of Fidelity Investments) and Janet Yellen (former Chair of the Federal Reserve) continue to lead and influence the finance world. Abigail Johnson oversees one of the largest and most influential financial services companies in the world. Her leadership exemplifies the substantial role women play in today’s financial landscape.

Janet Yellen, as the former Chair of the US Federal Reserve, the first woman to hold this esteemed position. Her role involved shaping and implementing monetary policy for the United States, underscoring the essential contribution of women to economic stability. These contemporary leaders demonstrate the positive impact of gender diversity in finance and contribute to the ongoing recognition of women within the industry.

Women Shaping the World of Finance

The history of women in finance is a story of determination, resilience, and success against the odds. From the early pioneers to contemporary leaders, women have made invaluable contributions to the industry. Recognising and promoting diversity in finance is not just a matter of equality but also a key to success. The future promises even greater opportunities for women in finance as they continue to break down barriers and redefine the industry.

Patterson Mills are proud to empower women to thrive in this dynamic field. If you are looking to taking your own steps to financial independence and enhance your own financial wellbeing to break down  the barriers you face, make sure you get in touch with us today and book your initial, no-cost and no-obligation meeting, you and your family will be pleased that you did. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

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Protection

Insurance 101: Protecting What Matters Most

Insurance 101: Protecting What Matters Most

“If there is anyone dependent on your income – parents, children, relatives – you need life insurance” ― Suze Orman

5 min read

Insurance 101: Protecting What Matters Most

“If there is anyone dependent on your income – parents, children, relatives – you need life insurance” ― Suze Orman

5 min read

You wouldn’t hike a mountain without the appropriate gear, nor jump out of a plane without a parachute. Insurance is exactly like that hiking gear or parachute, a safety net for your financial wellbeing. It provides you with protection and peace of mind, ensuring that you and your loved ones are financially secure, even if the unexpected happens.

What is Insurance?

Other than a financial safety net, insurance is a financial contract between you and an insurance company. You pay regular premiums, and in return, the insurer promises to provide financial support when specific events, known as “covered events,” occur. The goal of insurance is to protect you from potential financial losses related to these events.

The Frequency vs Impact Matrix

An important part of the financial planning process is to identify different types of risk and to plan accordingly. Some risks are best managed while others are best insured. The risk that a casual passer-by will walk into a person’s home and steal the cash sitting on the hall table is best managed by keeping the front door locked and putting large sums of money out of sight. But the more remote risk that a determined burglar might break in and steal valuables is best left to insurance.

The most common way to categorise different types of risk is according to their severity of impact as well as their likelihood of occurrence. Some events are very likely to occur but may not be so important in terms of their impact on a person’s life. Most people might cut their finger or graze their knee from time to time, but any cost is likely to be relatively low or non-existent. Some events, such as the house burning down, can be disastrous but happen very rarely. Insuring against minor and frequent risks may be expensive and pointless, but it generally makes sense to insure the high impact but low frequency type of risk, where an insurer is prepared to cover through an insurance policy. The main events that have a high potential impact on individuals and their families are death and disability, which should be the top priorities for insurance-based solutions.

The above is best illustrated with the simple Frequency-to-Impact Matrix as below:

Frequency-Impact-Matrix - Insurance 101

What the above matrix is showing is that an event such as a minor injury (non-severe scrapes of your knee or cuts on your hand) would fall into the bottom right box. These can typically be ignored or easily dealt on a day-to-day basis.

The high frequency and high impact could include periods of unemployment, especially for certain sectors. Insurance for these occurrences can be expensive or you may not find insurance companies willing to cover these events. Thus, this type of risk is best ‘managed’. In the example of unemployment, it would be advisable to accumulate a ‘rainy day fund’ or savings pot whilst you are employed to ensure sufficient financial support is available when you need it most.

Low frequency but high impact could include retirement. Generally, you will only retire once, but the impact of stopping work and losing an earned income is often very high. In this example, saving money towards retirement (such as pensions and investments) can generate a sufficient income during and throughout your retirement. In addition, other low frequency but high impact events (such as your house burning down or premature death of a family member) can have severe financial consequences. Most people find it difficult to build up a sufficient savings fund to support themselves during such a potentially expensive time.

The Frequency-to-Impact Matrix can be summarised as follows:

  • Low Frequency but High Impact = Insure
  • High Frequency and High Impact = Manage or Insure (if possible)
  • Low Frequency and Low Impact = Easily Manage or Ignore
  • High Frequency but Low Impact = Easily Manage or Ignore

Why Might You Need Insurance?

The importance of insurance becomes evident in the face of life’s uncertainties. You may be asking yourself why you might need insurance, and the reasons are multifaceted and compelling. Insurance serves a multitude of purposes in your life, such as shielding your financial wellbeing, helping you comply with legal requirements, and providing a significant source of peace of mind.

The financial protection that insurance offers cannot be underestimated. It acts as a crucial safety net that can help you and your family stay financially secure, even in the wake of an unexpected event, like a medical emergency or a natural disaster. Additionally, the legal obligations surrounding insurance, such as mandatory health insurance in many places, underscore the significance of these financial agreements in your daily life.

Knowing that you and your loved ones are financially protected provides comfort and security, alleviating some of the stress and anxiety that can often accompany life’s uncertainties.

What Are The Main Types of Insurance?

There is a diverse range of insurance products available to suit the many unique aspects of your life. The landscape of insurance is vast and varied, and it’s important to explore the various types of insurance available to understand which policies align with your individual needs and circumstances.

A. Health Insurance

Health insurance is your financial safeguard in the realm of healthcare. Its primary role is to cover medical expenses when you require medical treatment or attention. Health insurance comes in various plans, each offering different levels of coverage and financial protection. Depending on your specific health needs, you can choose the plan that best suits your health and financial requirements, helping you navigate the complex and often costly world of healthcare with greater ease.

B. Life Insurance

Life insurance provides you with a unique form of financial support. It is designed to offer a financial lifeline to your beneficiaries in the event of your passing. There are two primary categories of life insurance: term life insurance and whole life insurance. Each category is equipped with distinct features, and your choice between them depends on your financial goals and life circumstances. By securing a life insurance policy, you take a proactive step towards ensuring that your loved ones remain financially stable, even in your absence.

C. Homeowners / Renters Insurance

For many people, their home is not just a physical space but a haven of personal and sentimental value. Homeowners or renters insurance is an essential form of protection for your abode and the belongings within. These policies provide financial security against potential risks, including property damage and theft. They also extend to personal liability coverage, helping you mitigate financial risks associated with accidents that occur on your property. Whether you’re a homeowner or a renter, safeguarding your dwelling and your personal possessions through insurance is a prudent and necessary step in securing your financial future.

D. Car Insurance

Car insurance is a type of financial protection specifically designed for drivers. It offers a comprehensive safety net in the event of car accidents, covering damages to your vehicle and personal injuries. Car insurance typically includes various components, such as liability insurance, which covers expenses related to injuries or property damage caused by your vehicle, as well as collision and comprehensive coverage, which helps mitigate the financial implications of accidents, theft, and more. If you own a vehicle, auto insurance is not just a choice but a legal requirement in most places.

E. Travel Insurance

Travel insurance is your trusted companion when you embark on a journey. It serves as a protective shield for your travel investment, ensuring that you enjoy a worry-free trip. This form of insurance covers a wide array of unexpected events that could disrupt your travel plans, such as trip cancellations, medical emergencies while abroad, lost luggage, and even flight delays. By investing in travel insurance, you can experience the world with greater confidence and financial security, knowing that you are prepared for any unexpected twists and turns during your adventures.

F. Winter Sports Insurance

Winter sports insurance is a specialised form of coverage for those who enjoy the thrills of activities like skiing, snowboarding, and other winter sports. These insurance policies are tailored to provide protection against accidents, injuries, or other mishaps that can occur while you’re out on the slopes. With winter sports insurance, you can enjoy your snowy adventures without worrying about the potential financial consequences of unexpected incidents during your outings.

How to Obtain Insurance

Now that we have revealed to you the potential significance of insurance in your life, you may be wondering where and how you can obtain the coverage that fits your unique needs. The process of securing insurance can vary depending on the type of coverage you require. Here’s a general outline of how to obtain insurance:

1. Identify Your Needs: The first step in obtaining insurance is identifying your needs. Determine what aspects of your life or assets require protection. For example, if you own a car, auto insurance is essential. If you have dependents, life insurance should be considered. Evaluate your personal circumstances, financial goals, and lifestyle to pinpoint the types of insurance that will offer you the most value.

2. Shop for Insurance Providers: With a clear understanding of your insurance needs, you can start shopping for insurance providers. It’s crucial to research and compare various insurance companies to find the one that aligns with your requirements. Consider factors such as the company’s reputation, financial stability, customer service, and the specific policies they offer.

3. Consult with a Financial Adviser or Insurance Broker: Financial Advisers and Insurance Brokers are professionals who can help you navigate the complexities of insurance. They communicate and work with multiple insurance companies and can offer you a range of policy options. Consulting with a Financial Adviser or Insurance Broker can save you time and help you find the best coverage at a competitive price. They can also explain the intricacies of different policies and assist you in making an informed decision.

4. Obtain Quotes: Once you’ve identified potential insurance providers, request quotes from them. Quotes provide you with estimates of the premiums you’ll need to pay for the coverage you desire. This allows you to compare costs and choose the most cost-effective option. Be sure to provide accurate information during the quoting process to receive precise estimates.

5. Understand Policy Terms (READ THE CONTRACT): Before finalising your insurance purchase, carefully review the terms and conditions of the policy. Pay close attention to aspects like coverage limits, deductibles, exclusions, cancellation policy and any additional benefits. Ensure that the policy addresses your specific needs and goals.

6. Make Informed Decisions: Based on the information gathered during your research, consultations, and quote comparisons, make informed decisions about your insurance coverage. Select the policies that offer the best value and protection for your individual circumstances.

7. Complete the Application: Once you’ve made your selections, you’ll need to complete an application for the chosen insurance policies. The application typically requires you to provide detailed information about yourself, your assets, or the individuals you’re insuring.

8. Pay Your Premiums: Insurance policies require regular premium payments. The frequency and method of premium payments can vary depending on the policy and provider. It’s essential to make premium payments on time to maintain continuous coverage.

9. Review and Update Your Policies: Life is dynamic, and your insurance needs may change over time. It’s crucial to periodically review your insurance coverage and make necessary updates to ensure it continues to meet your financial goals and circumstances.

10. File Claims When Needed: In the unfortunate event of a covered incident, you’ll need to file a claim with your insurance provider to receive financial assistance. The claims process will depend on the type of insurance and the specifics of your policy. Familiarise yourself with the claim procedures so that you can efficiently receive the support you need during difficult times.

A Prudent Financial Decision

Now you know the basics of how to get and the key types of insurance. Taking out an insurance policy is a prudent financial decision that offers you and your loved ones peace of mind and protection against the unpredictabilities of life. Of course, there may be those for whom insurance might not be possible due to various factors, but always try to ensure your needs are insured if you can. Insurance safeguards your financial wellbeing and ensures that you are prepared for unexpected events.

Choosing the right coverage for your needs is a significant step in securing your financial future and that of your loved ones. Patterson Mills are here to make sure your family are taken care of in the best of times as well as the not-so-good ones. Get in touch with us today and book your initial, no-cost and no-obligation meeting, you and your family will be pleased that you did. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for information purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

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Pensions

Financial Independence: Retiring With Confidence

Financial Independence: Retiring Early, Early Retirement

Financial Independence: Retiring With Confidence

“As in all successful ventures, the foundation of a good retirement is planning” ― Earl Nightingale

3 min read

Financial Independence: Retiring Early, Early Retirement

Financial Independence: Retiring With Confidence

“As in all successful ventures, the foundation of a good retirement is planning” ― Earl Nightingale

3 min read

Achieving financial independence, retiring with confidence and even retiring early is a dream for many. This article explores the key principles and strategies for those looking to achieve financial independence for retirement or retire ahead of the traditional retirement age. Financial independence and early retirement can provide a life filled with leisure, travel, and personal pursuits, but it requires careful planning and a strong financial foundation.

What Is Financial Independence?

Firstly, what is ‘financial independence’ and why would you wish to achieve it?

Financial independence is a state where your passive income, such as investments and savings, can cover your living expenses, allowing you to enjoy life on your own terms. It’s the freedom to make choices without being constrained by financial concerns. For example, choosing when to work rather than going to work because you have to earn an income. This financial status is the precursor to early retirement, though they are not one and the same.

The Path to Financial Independence

  1. Smart Financial Planning: Successful early retirement begins with smart financial planning. Start by setting clear, achievable financial goals and creating a roadmap to reach them. This includes budgeting, tracking expenses, and understanding your financial position.

  2. Savings and Investments: Building a substantial nest egg is essential for early retirement. Popular strategies include the 4% rule, which suggests withdrawing 4% of your investments annually, and harnessing the power of compound interest. Consider various investment vehicles such as stocks, bonds, and real estate.

  3. Debt Management: High-interest debt can be a roadblock on your path to financial independence. Focus on paying off high-interest loans, such as credit cards, and minimizing mortgages. A debt-free life can significantly enhance your financial independence journey.

  4. Emergency Funds: To retire early, it’s crucial to have a robust emergency fund. This acts as a safety net for unforeseen expenses, preventing the need to dip into your retirement savings.

Challenges and Overcoming Them

  1. Healthcare Costs: Healthcare expenses can be a significant concern. Secure comprehensive health insurance and plan for healthcare costs in your early retirement budget.

  2. Market Volatility: Early retirees must be vigilant in managing their investments and must have a strategy to navigate market volatility. Diversification, asset allocation, and risk tolerance assessment are key components.

  3. Inflation: Adjust your financial plans to accommodate the impact of inflation. Realise that over time, your expenses will increase, and your retirement income must keep pace.

  4. Social Security and Pensions: Understand the role of Social Security and any pensions you may have in your early retirement. These can provide valuable, and in most cases essential, additional income streams.

Early Retirement: Unlocking a World of Possibilities, Freedom and Fulfillment

The dream of early retirement has captivated the imagination of many individuals seeking a life outside the traditional constraints of a 9-to-5 job. It’s about reclaiming your time, your freedom, and the ability to explore a world of possibilities. Early retirement signifies a transition from the daily grind to a life that you design on your own terms.

The benefits of early retirement extend far beyond escaping the daily commute. It’s about enjoying a life of freedom, fulfillment, and reduced stress. Early retirees have the luxury of pursuing their passions, spending quality time with loved ones, and engaging in activities that truly matter to them. This newfound freedom not only enhances overall quality of life but also fosters personal growth and self-fulfillment.

Confidence in Early Retirement

Achieving financial independence is not solely about money; it also entails managing the emotional and psychological aspects of early retirement. Finding a sense of purpose in retirement, staying mentally and physically active, and nurturing relationships are all important for a fulfilling life.

From Planning to Execution

Achieving early retirement and financial independence requires a well-thought-out plan and disciplined execution. From meticulous financial planning, smart investments, and debt management to building additional income streams, early retirees meticulously craft their path to financial independence. They understand the significance of savings, investments, and strategic career decisions in making this dream a reality.

No matter what others may say, it is possible, and Patterson Mills are here to make sure you have the best possible chance of a successful financial future. Get in touch with us today and book your initial, no-cost and no-obligation meeting. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

Categories
Financial Planning

Family Finances: Raising Financially Savvy Kids

Family Finances: Financially Savvy Kids
happy family mother father and kids at home on the couch

Family Finances: Raising Financially Savvy Kids

“You are the bows from which your children as living arrows are sent forth” ― Khalil Gibran

3 min read

Family Finances: Financially Savvy Kids

Family Finances: Raising Financially Savvy Kids

“You are the bows from which your children as living arrows are sent forth” ― Khalil Gibran

3 min read

In an age when technology offers the convenience of digital payments and contactless transactions, teaching children about financial responsibility has never been more crucial. Whilst kids might not grasp the complexities of the stock market or macroeconomics, they can certainly learn the fundamentals of money management, saving, and budgeting. It’s all about securing long-term financial freedom, made even more accessible by having the right knowledge.

Lead by Example

One of the most effective ways to teach children about money is by modeling good financial behaviour. Kids tend to learn by observing their parents or guardians. If they witness responsible spending, saving, and investing practices at home, they are more likely to adopt these habits themselves. Conversely, if they observe careless or impulsive financial decisions, they may mimic those actions. So, set a positive financial example by making well-informed financial choices in front of your children.

Age-Appropriate Financial Lessons

Teaching children about money should be age-appropriate. Younger children can learn about basic concepts like differentiating between coins and notes and the importance of saving money in a piggy bank. As they grow older, you can gradually introduce more advanced topics, such as budgeting, investing, and the concept of interest. If you start your children’s financial education by explaining Discretionary Trusts, it may be too complex and turn them away from ever visiting the subject.

Use Your Family Finances for Real-Life Situations

Learning about money becomes more meaningful when children can apply their knowledge in real-life situations. Allow them to manage a small allowance, whether it’s for completing household chores or for good behavior. This provides kids with a practical context for money management. Encourage them to save a portion of their allowance while discussing potential expenditures and financial goals.

Open a Kids' Savings Account

A kids’ savings account is an excellent way to teach children about banking and the concept of earning interest on savings. Many banks offer specialised savings accounts for children that come with features such as low minimum balances and educational materials. Opening an account in your child’s name and making regular trips to the bank together (or nowadays to the bank’s website or online portal!) can help demystify the financial world.

Teach Wise Spending Choices

Discuss the concept of needs versus wants. Help your children differentiate between items they truly need and items that are optional or for pleasure. When they receive gifts or allowance, encourage them to think critically about how to allocate their money, balancing saving for future goals with the enjoyment of spending.

Allow Them to Make Mistakes

Financial lessons often come with a price, but it’s better for children to make small financial errors while the stakes are low. If they spend all their allowance and later regret it, that experience can be a valuable lesson in managing money wisely.

Discuss the Power of Saving

Teach your children about the benefits of saving money. Explain how their savings can grow over time, and introduce the concept of compound interest. Show them that patience and discipline can lead to significant financial rewards.

Make Learning Fun

Learning about money doesn’t have to be dull or intimidating. Engage your kids in enjoyable financial activities. Board games like Monopoly or The Game of Life offer valuable lessons in budgeting and decision-making. Additionally, many online resources and mobile apps are designed to educate children about money management in a fun and interactive way.

A Brighter Future For Your Children

By instilling financial knowledge and responsibility from an early age, you set your children on the path to financial independence and success. Teaching them to manage money wisely, save, and make informed financial decisions can lead to a lifetime of good financial habits. Remember that raising financially savvy kids is an ongoing process, and your guidance plays a pivotal role in their financial education. By following these steps and incorporating them into your daily life, you can help your children build a strong financial foundation for their future.

Patterson Mills are here to make sure your financial future, and that of your children’s, children’s children and beyond, are as successful as possible. Get in touch with us today and book your initial, no-cost and no-obligation meeting. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

Categories
Financial Planning

Credit Score 101: Building and Maintaining Good Credit

Credit Score
Credit Score Concept. Closeup of a man checking his FICO score on his cell phone.

Credit Score 101: Building and Maintaining Good Credit

“Whether you’re earning $7 an hour or $700,000 a year, it’s very important to protect your credit rating” ― Frank Abagnale

2 min read

Credit Score

Credit Score 101: Building and Maintaining Good Credit

“Whether you’re earning $7 an hour or $700,000 a year, it’s very important to protect your credit rating” ― Frank Abagnale

2 min read

A good credit score is your passport to accessing essential financial services. Whether you’re applying for a credit card, a mortgage, or a personal loan, your credit score plays a pivotal role in the approval process. Understanding the fundamentals of credit scores and how to build and maintain good credit is vital for your financial wellbeing.

What Is a Credit Score?

Your credit score is a numerical representation of your ‘creditworthiness’. It provides lenders with a quick and easy way to evaluate your credit risk. Credit scores typically range from 300 to 999, with higher scores indicating lower credit risk (you want a higher score!). Your score is calculated based on various factors, including your payment history, credit utilisation, length of credit history, types of credit accounts, and recent credit inquiries.

How Is a Credit Score Used?

Lenders use your credit score to determine the risk associated with lending you money. A higher credit score often translates to lower risk in the eyes of lenders, making it easier to qualify for loans with favorable terms, such as lower interest rates. In contrast, a lower credit score may lead to higher interest rates, less favorable loan terms, or even loan denials.

Building a strong credit foundation is not only a financial goal but a valuable skill in navigating the world of personal finance.

The Factors That Influence Your Credit Score

One of the key elements of your credit score is your payment history. Lenders look at whether you make payments on time, as well as any history of late payments or defaults. Other significant factors include your credit utilisation (the amount of credit you use compared to your total credit limit), the length of your credit history, the types of credit accounts you have (e.g. credit cards, loans), and recent credit inquiries. By understanding how these factors influence your credit score, you can take steps to maintain and improve it.

Credit Reports: The Foundation of Credit Scores

Your credit score is based on the information contained in your credit reports, which are maintained by credit bureaus or credit reporting agencies. These reports include details about your credit accounts, payment history, public records (such as bankruptcies or tax liens), and inquiries made into your credit history. Regularly reviewing your credit reports is essential to ensuring their accuracy and addressing any discrepancies.

Building Good Credit: Tips and Strategies

Building and maintaining good credit requires a strategic approach. This includes:

  • Always making your payments on time
  • Keeping your credit card balances low
  • Having a mix of different types of credit accounts
  • Being cautious about opening new credit accounts

Additionally, you should create a budget, live within your means, and avoid excessive debt, as these practices can have a positive impact on your credit score.

Protecting Your Credit: Identity Theft and Fraud Prevention

Identity theft and fraud can significantly damage your credit. Regularly monitoring your credit reports for any unusual or unauthorised activity is a crucial part of this process.

Your Path to Strong Credit

A good credit score opens doors to financial opportunities, from better loan terms to lower insurance premiums. With the insights gained from this article, you can work on building and maintaining strong credit. By managing your finances responsibly, monitoring your credit reports, and being vigilant against identity theft and fraud, you’ll be well on your way to financial success.

Not sure where to start? Get in touch with Patterson Mills today and book your initial, no-cost and no-obligation meeting. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

Categories
Investments

How to Know When Stock Markets Are Crashing

How to Know When Stock Markets Are Crashing

“One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute” ― William Feather

3 min read

How to Know When Stock Markets Are Crashing

“One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute” ― William Feather

3 min read

Stock markets are dynamic entities that can experience rapid fluctuations. Understanding when a market is crashing is crucial for investors looking to protect their portfolios and make informed decisions. There is no way of knowing for certain, and anyone who tells you they “know” is likely making it up, but with the indicators we will discuss in this article, you will hopefully be able to recognise when a stock market crash might be imminent.

1. Abnormal Trading Volume

One of the first signs of an impending market crash is a significant increase in trading volume. When trading volume surges, it can indicate that many investors are frantically buying or selling shares. An unusual volume spike may signify panic or irrational behaviour, which could trigger a market downturn.

2. Declining Stock Prices

Whilst it might seem obvious, declining stock prices overall are a clear indication of a market under distress. If you observe a broad decline in share values across multiple sectors, it’s an alarming sign that the market might be crashing. Pay attention to stock indices and market benchmarks like the S&P 500, FTSE100, ASX etc. which can provide insights into the overall health of the market.

3. Economic Indicators

Keep an eye on economic indicators such as the Gross Domestic Product (GDP), unemployment rates, and consumer confidence. A consistent decline in these indicators can foreshadow a recession or economic downturn, which often leads to a market crash.

4. Volatility Index (VIX)

The Volatility Index, often referred to as the VIX or the “fear gauge,” measures market volatility. A significant spike in the VIX indicates growing uncertainty and fear in the market. Investors commonly use the VIX to gauge market sentiment.

5. Bond Market Signals

The bond market can provide valuable clues about the stock market’s future. An inverted yield curve, where short-term interest rates exceed long-term rates, has historically preceded market crashes. Bond prices also tend to rise when investors seek safety, signalling potential trouble in the stock market.

6. News and Headlines

Pay attention to financial news and headlines. Negative news stories, geopolitical tensions, or global events can trigger panic among investors and lead to market sell-offs. Frequent market news updates can help you stay informed and make timely decisions.

7. Institutional Investors' Actions

Monitor the actions of institutional investors like mutual funds, hedge funds, and pension funds. Large-scale selling by these entities can be a sign of uncertainty and can further exacerbate a market crash.

8. Stock Valuations

Examine price-to-earnings (P/E) ratios and other valuation metrics for individual stocks and the overall market. Extremely high valuations could indicate an overbought market, making it vulnerable to a correction or crash.

9. Technical Analysis

Technical indicators such as moving averages, relative strength, and momentum can help identify trends and possible market reversals. Learning to interpret these signals can be an essential skill for investors.

10. History as a Guide

Review past market crashes, like the Great Recession of 2008 or the Dot-Com Bubble burst in 2000. Historical patterns and parallels can offer valuable insights into the early warning signs and stages of a market crash.

11. Risk Management Strategies

In addition to identifying signs of a market crash, having a risk management strategy is essential. Diversifying your portfolio, setting stop-loss orders, and establishing an emergency fund can help mitigate potential losses during market downturns.

12. Seek Professional Advice

If you’re uncertain or anxious about market conditions, consider consulting a Financial Adviser or other professional. Their expertise can guide you through volatile periods and help you make sound investment decisions.

Preparation is Key

Whilst predicting a stock market crash with certainty is challenging, by which we mean impossible until it is too late, recognising the warning signs and staying informed is crucial. Developing a steadfast investment strategy and maintaining a long-term perspective can help you weather market turbulence and secure your financial future. Remember that markets have historically rebounded after crashes, highlighting the importance of staying calm and resilient during challenging times.

In a world of financial uncertainties, knowledge and preparation are your most potent tools.

If you’re not sure whether your investments are prepared for any future uncertainty that may (or may not!) arrive, , get in touch with Patterson Mills today and book your initial, no-cost and no-obligation meeting to ensure you can survive any storms on the horizon. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

Categories
Investments

Why Invest During High Interest Rates

Interest Rates
Worried young Caucasian couple going over their bills and home finances in the morning in the kitchen

Why Invest During High Interest Rates

“A regulator is supposed to create and enforce a standard” ― Travis Kalanick

3 min read

Interest Rates

Why Invest During High Interest Rates

“A regulator is supposed to create and enforce a standard” ― Travis Kalanick

3 min read

Investment decisions are often influenced by the prevailing economic conditions. One critical factor that can significantly impact investment strategies is the interest rate environment. Interest rates, set by central banks and influenced by various economic factors, play a pivotal role in shaping the investment world. As interest rates rise, fall, or remain stable, investors must adapt to the changing financial climate. In this article, we will explore the reasons why one might consider investing in a high interest rate environment.

Understanding the High-Interest Rate Environment

It’s essential to first grasp the concept of interest rates and how they are determined. In essence, an interest rate represents the cost of borrowing money or the return on investment for lending or saving. Central banks, like the Swiss National Bank in Switzerland, Federal Reserve in the United States or the European Central Bank in Europe, set interest rates as part of their monetary policy tools. These rates directly impact the cost of credit, the attractiveness of savings, and the overall flow of money in the economy.

Why Invest in a High-Interest Rate Environment

Now, let’s explore why investing in a high interest rate environment can be an attractive proposition:

  1. Enhanced Fixed-Income Returns: In a high interest rate environment, fixed-income investments, such as bonds or certificates of deposit (CDs), tend to offer more attractive yields. This can provide investors with a stable and predictable source of income, making it particularly appealing for retirees and income-focused investors.
  2. Favourable Economic Conditions: A high interest rate environment often corresponds to strong (potentially ‘too strong’) economic conditions, low unemployment, and robust growth. This can translate into higher consumer spending, increased business investment, and a generally healthier investment environment. By investing in assets that benefit from these conditions, you can diversify your portfolio, reducing risk.
  3. Hedging Against Inflation: High interest rates can act as a hedge against inflation, preserving the purchasing power of your investments. In times of rising prices, the returns from high-yield investments can outpace the erosion of your money’s value.
  4. Wealth Accumulation: For long-term investors, high-interest rates can contribute to more substantial wealth accumulation over time.
  5. Safe Haven for Capital: Investors often flock to assets like government bonds during high-interest rate periods. These investments are considered safer, and their demand can increase, making them a haven for capital preservation. This is because newly issued bonds tend to offer more attractive yields. Investors can lock in these higher interest rates, leading to increased income from their bond investments.
In high interest rate environments, it’s important to keep in mind that markets can be unpredictable in the short term, much like many other aspects of life. Attempting to trade headlines and make hasty decisions can be risky, as numerous examples have demonstrated in the past. Make sure you make informed decisions or consult your Financial Adviser.

Your Investing Partner

Investing in a high interest rate environment can be a strategic move for investors seeking to capitalise on the unique opportunities presented by rising rates. The potential for higher yields, income generation, capital preservation, and diversification makes it easy to try and trade headlines to attractive asset classes in such conditions. However, it’s essential to approach high interest rate environments with a well-thought-out investment strategy that aligns with your financial goals, risk tolerance, and time horizon. 

If you wish to learn more about how you could invest in a high-interest rate environment, get in touch with Patterson Mills today and book your initial, no-cost and no-obligation meeting to ensure your strategy is as effective as it could, and should, be. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

Categories
News

The Swiss Financial Regulatory Authority: FINMA

FINMA

The Swiss Financial Regulatory Authority: FINMA

“A regulator is supposed to create and enforce a standard” ― Travis Kalanick

3 min read

FINMA

The Swiss Financial Regulatory Authority: FINMA

“A regulator is supposed to create and enforce a standard” ― Travis Kalanick

3 min read

Switzerland is a country synonymous with financial stability, precision, and excellence. At the core of Switzerland’s financial sector stands the Financial Market Supervisory Authority, or FINMA, serving as the guardian of the country’s financial system. Today, we are going to break down its functions, responsibilities and significance in Switzerland’s financial landscape.

Origins and Historical Development

The acronym FINMA stands for the Financial Market Supervisory Authority.

The origins of FINMA can be traced back to Switzerland’s enduring commitment to financial stability and sound economic governance. Formed on 1st January 2009, FINMA is a product of the merger of three former supervisory authorities, specifically the Federal Banking Commission, the Federal Office of Private Insurance, and the Anti-Money Laundering Control Authority. This strategic merger aimed to streamline and consolidate Switzerland’s regulatory landscape, ensuring a more unified and efficient approach to financial market supervision.

A Beacon of Stability

Switzerland’s financial sector has long been heralded for its stability, discretion, and reliability. Renowned for its banking prowess, the country has positioned itself as a global financial centre, attracting investors, corporations, and individuals seeking a secure haven for their wealth. Switzerland’s steadfast commitment to maintaining a resilient and well-regulated financial environment makes it a beacon of stability in the volatile world of international finance.

The Role and Mandate of FINMA

FINMA is charged with the critical mandate of overseeing and regulating Switzerland’s financial markets, FINMA plays an instrumental role in maintaining transparency, integrity, and compliance within these markets. By regulating banking, insurance, securities trading, financial advice and asset management, FINMA ensures that each key financial market operates in accordance with Swiss and international standards.

Key Principles and Objectives of Financial Market Supervision

Financial market supervision, as carried out by FINMA, is guided by a set of key principles and objectives. These principles encompass maintaining financial stability, protecting market participants, and ensuring the efficient functioning of financial markets. The regulatory body’s ultimate goal is to contribute to a reliable and trustworthy financial sector that commands the confidence of local and international investors.

FINMA's Regulatory Toolbox

FINMA’s prudent oversight approach is fundamental to its role as a financial regulator. The authority employs a versatile set of tools and strategies to maintain compliance and ensure the health of financial markets. These tools may include issuing guidelines, conducting inspections, imposing sanctions, and coordinating with international regulators. The dynamic regulatory toolbox at FINMA’s disposal reflects its dedication to preserving the integrity and transparency of Switzerland’s financial landscape.

Structure, Members, and Decision-Making

The FINMA Board serves as the cornerstone of the regulatory authority, overseeing its strategic direction and decision-making processes. Comprised of experts from various fields, including finance, law, and economics, the Board holds a vital role in shaping financial policy in Switzerland. Through collaborative decision-making, members of the Board drive the direction of financial market regulation and address challenges that may emerge in the financial sector.

Key Challenges FINMA Faces

One of the critical challenges is striking the right balance between innovation and regulation. Switzerland is known for its financial innovation, including a burgeoning fintech sector. As innovation races ahead, it’s essential for FINMA to create a regulatory environment that fosters innovation while safeguarding stability and investor protection. In this era of rapid technological advancement, achieving this equilibrium is a persistent challenge for the authority. FINMA must continually adapt to shifts, ensuring that its regulations remain effective, transparent, and responsive to emerging threats.

Financial Advisers' Regulation by FINMA

For the clients of Financial Advisers, it is vital that you ensure your own protection by only utilising firms that are transparent about their regulated status, confirming they are indeed regulated. This applies globally. In Switzerland, FINMA ensures that you are protected and that your Adviser complies with established standards and adheres to best practices.

Financial Advisers in Switzerland must meet stringent requirements, including qualifications, professional conduct, and ethical standards. FINMA works to maintain and improve these standards, ensuring that advisers are well-prepared to provide sound financial guidance to their clients. One of FINMA’s key responsibilities concerning financial advisers is to prevent conflicts of interest and ensure transparency. The authority aims to maintain a fair and equitable financial advisory environment in which Advisers prioritise their clients’ best interests. This helps protect investors from potential misconduct and unethical practices, creating a more trustworthy and stable financial marketplace.

Trusted, Transparent, Regulated: Patterson Mills

The good thing about reading this article is that you need look no further to find a regulated, transparent and trusted Advisory firm. Patterson Mills remain committed to our roots, ensuring our client’s best interests are always aligned with our own.

With Patterson Mills, you don’t have to worry about where your money is going or whether it is working in your best interests because, the truth is, when you use Patterson Mills’ services, your money is only working to ensure your financial future is as secure as possible, with every step of the process clearly and transparently laid out before you make any decision.

So, get in touch with Patterson Mills today and book your initial, no-cost and no-obligation meeting to ensure you benefit from fully regulated, transparent and trusted advice, today. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.

Categories
Australia

Owning Property in Australia as a Foreign Resident

Australian Property in Australia
Australian flag standing on green grass in front of house. Australia day national holiday celebration. Real estate property for buy and sell in Australia market.

Owning Property in Australia as a Foreign Resident

“Know what you own, and know why you own it” ― Peter Lynch

3 min read

Australian Property in Australia

Owning Property in Australia as a Foreign Resident

“Know what you own, and know why you own it” ― Peter Lynch

3 min read

Owning property in Australia as a foreign resident can be a complex but rewarding venture. It requires careful planning and consideration of various factors. Whether you are an expatriate who intends to eventually return to Australia or a non-resident investor, there are certain tax implications, and financial aspects involved of which it is important to be aware.

A Great Investment Opportunity?

Property ownership in Australia can be a lucrative long-term investment. The Australian real estate market has demonstrated consistent growth over the years, and for many expats, renting out their Australian property can serve as an invaluable source of income. With property also comes the ability to have a home base for any return or lengthy stay in Australia, which ensures a smoother transition upon any future relocation.

One of the most notable incentives for property investments in Australia is the potential for a reduction in tax on any capital gain made upon the sale of the property. However, the rules on this can be complex and it is important to note that you generally only benefit from such a tax concession should you resume tax residency or become tax resident in Australia.

Nevertheless, due to these incentives (and others), investing in the Australian property market to benefit from potential tax savings and long-term growth is an attractive option for many.

When considering either Australian property as an investment decision or selling your existing property, it is recommended to seek professional advice to ensure the process is as seamless as possible.

Navigating Challenges

As with all forms of investing, property does not come without its own unique risks and challenges. Though not exclusive to the Australian property market, the lack of liquidity present compared to other styles of investing needs to be carefully considered.

In addition, perhaps more specific to the Australian property owners amongst you, the challenge of simply operating on a vastly different time zone when dealing with maintenance and management of property poses potentially significant issues in the worst of cases. Day-to-day, this will likely be a small issue, but it is definitely worth keeping in mind.

To that end, being in another Country does not just invite time zone complications. Whilst Australia uses the Australian Dollar (AUD), Switzerland uses the Swiss Franc (CHF), the United Kingdom uses the Pound Sterling (GBP), the United States uses the US Dollar (USD) and so on. What this really means is that there is an ever-present currency risk that has the potential to seriously impact your returns when converting income earned in AUD to that of CHF or other relevant currency. Exchanges rates constantly fluctuate and so be sure to check the latest exchange rate(s) available to you with the institution you wish to exchange with.

Returning to Australia?

If you plan to return to Australia now or in the future, consider whether holding onto your property until you become an Australian tax resident would be suitable. In doing so, you could minimise unnecessary tax charges.

It is essential to ensure that your property holdings align with your future requirements upon your return. Whether leveraging the property for rental income, capitalising on long-term capital gains, or even your family’s evolving needs, making a property selection that aligns with your long-term goals is crucial for a smooth relocation. Effective financial planning now (before you arrive in Australia) can yield substantial benefits down the road. You’ll thank yourself for starting planning early!

Remaining Overseas?

For those with no plans to return to Australia, the approach to property ownership and tax management may differ and require a more considered approach. Should you hold onto your existing property? Should you sell? How long will you stay overseas? Could your funds be more efficiently invested elsewhere? All these are questions to consider (as well as many more!) to ensure that your property portfolio aligns with your broader investment goals.

For long-term financial success, it is crucial to think about whether your properties will be beneficial over the long-term, or not. In addition, the laws and regulations in place today are always open to change in the future and any changes may negatively (or, equally, positively) impact your decisions. Explore tax strategies available to you and how you can make the most of your Australian property whilst overseas.

Blueprint for Success

Owning property in Australia whilst overseas presents an exciting opportunity for wealth accumulation and the reassurance of a future home base. Yet, this journey is not without challenges, including management complexities, foreign exchange risks, and tax implications, notably for non-resident investors. Whilst it certainly offers its own advantages, real estate should be viewed as a component of a comprehensive strategy to diversify your investments and safeguard your financial wellbeing.

To walk this path with confidence, Patterson Mills are here to light the way. You don’t have to try and figure it all out on your own, get in touch with Patterson Mills today and book your initial, no-cost and no-obligation meeting and we will guide you every step of the way. Send us an e-mail to info@pattersonmills.ch or call us direct at +41 21 801 36 84 and we shall be pleased to assist you.

Please note that all information within this article has been prepared for informational purposes only. This article does not constitute financial, legal or tax advice. Always ensure you speak to a regulated Financial Adviser before making any financial decisions.