Our actions are normally governed by emotions. We’d like to think we are in control of our sensitivities but no matter how much we try, our feelings and thoughts get away from us and it is difficult to keep them in check. How often do we find ourselves in a simple political discussion and suddenly discover that anger has slowly crept into our tone of voice? How did it get there anyway? We were perfectly calm to start with.

Fear is another emotion that governs our behavior. When was the last time you held back from telling someone your true feelings for fear of being rejected?

In fact fear plays an overwhelmingly important role in our lives. Fear of dying. Fear of commitment. Fear of losing. Those that can overcome their fears usually move forward in life more rapidly than those who remain stuck in their possessive apprehensions.

Even in the area of investing, fear is a central ingredient. How much should we invest? Should we pull out early or risk losing whatever profits we have already made? In fact, should we be investing at all?

Although we each have a different level of risk tolerance, fear is often an underlying reason for investor mistakes. When we see our money slowly slipping away, panic sets in and we make the wrong move.

So in order to be an astute investor and anticipate some profits from our endeavors, we must learn to pull back from our fears and use our knowledge instead.

Forex trading

When it comes to Forex trading, we follow the same guidelines. Let’s face it. You wouldn’t start building a house without learning first how to use a hammer and nails. Why would you even consider Forex trading without knowing what Forex is all about?

Before placing even the first trade, you must come to the table with at least a minimum of understanding and information about the world of Forex. There are many online tutorials that will guide you through the basics of Forex and give you the background you will need in order to go forward. FXAcademy, for example, has just released a free online Forex course complete with animated videos, quizzes and links to relevant articles to keep you well informed.

With some knowledge under your belt, you can then open a Forexdemo account with an onlineForexbroker. This will enable you to trade with virtual money and gain the experience you need before trading for real.

Once you have gained the confidence you need to trade Forex, you can move on to a real trading account. Don’t forget to start small, see more on FXCM, and always move cautiously. Keep in mind that you will probably lose most of your money at the start. Now that you have learned to control your emotions, you won’t panic. Instead, you will lean on the information you have gleaned from your tutorials, ask advice from experienced traders and hopefully make the right moves.

Let’s face it. Forex trading, or any trading for that matter, is a gamble. No matter how much you think you can logically work out the best steps to take, the nature of investing is such that you will never be able to out-think and out-do the system. Stay in control of your emotions and be prepared for the inevitable. Sit back and try to have some fun. Winning or losing is not what is important; it’s how you play the game.

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The monetary system works well, which is why people all over the world have used money for thousands of years. Money has an agreed upon value, a standard by which worth is judged. Our standard is of course the dollar, and no one better than a young person knows the value of a dollar. Why? Because for you, dollars are hard to come by, easy to spend, and difficult to replenish.

Here is how a young person can stack these dollars by acting smartly

Start saving

Saving money is just plain easier if we’re saving for something. The thing we’re saving for is our goal. Our goal can be short-term or long-term, depending on the nature of the purchase. Generally speaking, short-term goals are easier to achieve because our aim is shorter. Long-term goals take years to achieve, but we all have to start somewhere.

Getting Credit

If the companies you want to borrow money from find out you’re negligent about paying your bills, if you’re always late, or always short, you’re going to have to pay more to borrow the money you want. That makes sense, doesn’t it? If you’re considered a risky bet, you have to pay more to borrow money. If on the other hand, you’re always on time, people will trust you more and you won’t have to pay as much for that car loan as the person who’s always late.

Automatic Savings/ Direct Deposit

Banks and other institutions know exactly how hard it is to save money. So they’ve come up with a tool to make it much easier. I’ve used automatic savings for years, and there’s no doubt that it’s helped me achieve some major financial goals. The only thing you need is a job and a bank account.

Here’s how it works:

• Decide how much you want to save
• Decide where you want this saved money to end up
• Save money without worrying about it!

Every month, I have money deducted from my paycheck and deposited into a variety of accounts. The money goes its way without my ever seeing it, in other words, it never makes it into my paycheck, so I don’t have to face the pain of writing a check, or even worse, depositing cash. You sign up in one of two ways. You can contact your human resources office, who should be able to send the money where you want it to go. And if you go from the direction of where you want your money to end up — say you want to open an online savings account and also fund your Roth Individual Retirement Account, then set up the accounts and have those institutions contact your bank account.

Value Investing

Your aim should be to buy good solid companies whose prices are within your budget. You are to then hold those companies until investing in them no longer makes sense. When does investing in a company make no sense? When their fundamentals — how they run their company — are not good, or when a company’s stock price is so expensive that it’s simply too late to count on any further upward momentum.

Look for impressive dividends

Some companies’ dividends are impressive indeed, and if their fundamentals are sound, I suggest that you own a piece of those companies. If it’s a great stock, like Apple was once upon a time, when it cost less than $20 per share, then you hold onto it and don’t ever let it go. Things that make us rich are a blessing, and I say that without one bit of hesitation. Having money in abundance is something to be grateful for, and if we’re able to earn money even while we’re sleeping, we’ve got the right idea.

So, what’s your investing motto? Buy good companies cheaply. If the company offers you the option of re-investing your dividends, act like you’ve got some sense and re-invest them. Buy and hold. Buy and hold.
Here’s what you look at carefully when you’re considering whether to buy shares of a company:

• What is their market capitalization; i.e., how much is the company worth?
• How much debt do they carry?
• Who runs the company? How long has this person been on board?
• What is their price to earnings ratio?
• What do they produce, and is their future outlook rosy or bleak?
• How many employees do they have? Are the employees treated well?
• How long has the company been in business?
• What is the outlook for the future?

How do we as individuals and nations keep up with rising prices when our incomes aren’t keeping pace? We can’t. Not as long as we don’t make a decent amount of money with our investments. Life is scary, unless you just sit around in an easy chair all day. We have to get out there. We have to take risks.

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A financially secure future is what most of us are constantly working towards. We set a portion of our funds aside for a safe future, invest in 401(k) plans, set up IRA accounts and try investing in sound retirement plans based on part research, part hearsay. Choosing a safe investment vehicle is a matter most people lose their sleep over. Does a 401(k) plan carry interesting tax benefits? Does an IRA account effectively maximize your money? Are bonds a sounder investment option than stocks? These are some questions that might occur to you while trying to choose an optimum retirement plan, which keeps your future out of harm’s way.

The fundamental solution to a retirement plan problem is the understanding of tax benefits and returns that each investment plan offers. The 401(k) plan and the IRA (individual retirement account) are tax free investment options where you don’t have to pay taxes on the money invested or the interest unless you begin receiving benefits. As contributing to these accounts leads to a decrease in your taxable income, you pay lesser taxes overall. However, both methods are fundamentally different from each other and need careful research before they you take a decision.

While the 401(k) plan is set up by your employer, an IRA is an individual choice. The 401(k) plan will allocate similar distributions to employees, while an IRA leaves you with a lot of options as far as investment vehicles go. The 401(k) plan gives you the option of withdrawing money during an emergency; other than reducing your net taxable income. However, when you start to withdraw money from your account, the amount will be taxed as additional income. Also, there are penalties for premature withdrawal.

The IRA comes with its own pros and cons. You don’t need any help from a financial planner as the account is easy to set up. It also gives you a lot of freedom in choosing investment options like bonds, stocks or mutual funds. However, it imposes penalties on premature withdrawal and has a low contribution rate.

Through a 401(k) or an IRA account, you could invest your money in a number of things such as bonds, mutual funds, stocks, real estate and so on. Each profile has a unique risk to returns ratio that must be studied before choosing to invest in. The stock market has always been an enigmatic and unassailable investment option to most. With a high risk and an even higher reward associated with it, a stock portfolio could potentially take your investments to new heights. Bonds do not carry the high risk that stocks do, but neither do they offer promising returns on investment.

Choosing the best plan would require extensive research and an understanding of your financial requirements. Investing in both, IRA and a 410(k) could well be a sound diversification strategy, according to some professionals. Other new age IRA plans like investing in commercial real estate could also be the key to an assured future. Seek expert advice before going for any option available to you.
When retirement finally happens, a retirement plan could be your knight in shining armour. A careful approach towards choosing a sound plan will go a long way in ensuring financial security.

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Income drawdown can provide a great way to keep you financially comfortable in later life. Here’s a look at how it works.

A Quick Look at Annuities

Income drawdown isn’t complicated, but it can be a little confusing if you’re only familiar with the annuity model of pensions. Annuities work like this: you make regular payments into your pension throughout your working life, and when you retire you use that money to purchase an annuity. An annuity is a financial product that guarantees you a fixed income until the day you die.

The problem with this model is that it may not provide for your needs. Annuity rates are dependent on market conditions, so when you go to retire, there is a chance that you may receive a poor rate. Although the payment is fixed, inflation means that it will decrease each year in real terms.

How Income Drawdown is Different

Instead of cashing in your pension on retirement day, income drawdown allows you to make regular cash withdrawals from your pension, within certain limits. You can vary the payments you receive according to your needs, and the money that you’ve invested will continue to grow.

To avail of income drawdown, you’ll need to choose a financial product such as a SIPP (Self-Invested Personal Pension) with drawdown functionality. SIPPs also offer a huge range of investment choices, giving you the opportunity to grow your fund even further.

What Kind of Payments Can I Get?

There are two types of payment available in an income drawdown pension:

• Tax-free cash: 25% of your fund is available tax-free and can be withdrawn in instalments or taken as a one-off lump sum.
• Income: Of the remaining 75%, you can withdraw money as and when you choose. These payments are subject to income tax, and their is a limit to how much you can withdraw each year. This limit is often referred to as the GAD Max, and you can withdraw up to your GAD Max each year. Whether you take this as a monthly payment or an annual lump sum is up to you.

How is My GAD Max Calculated

There are three factors in deciding your GAD limits. Your age and the value of the pension are both taken into consideration, with the intention that your income payments should be balanced in order to ensure a regular pension for the rest of your life. Gilt Yields, a figure issued each month by the Treasury, are also taken into account.

Your GAD Max is recalculated every three years, although in some circumstances you will be able to request a recalculation before then.

When Can I Start Taking Income Drawdown Payments?

You can begin drawing down form your pension at any time after the age of 55. You don’t need to have actually retired, although if you are still in employment then you’ll be liable to pay the same amount of income tax that you would pay on your normal salary.

Income drawdown payments can be reduced, increased (within GAD limits), stopped and restarted as you see fit.

Will I One Day Have to Purchase an Annuity?

No, you can continue to receive income payments for as long as you like. If you would like to purchase an annuity later on, you can do so with your remaining pension fund.

Are There Any Disadvantages to Income Drawdown?

Your pension payments are not guaranteed as they would be under an annuity arrangement. In order to keep receiving payments, you will need to have money in your pension and a bad investment choice may see your pension lose its value. This is why many income drawdown products are sold on an advice-only basis; it is recommend that you speak to a financial adviser before investing in such a product.

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Energy efficiency won’t just help save the environment – it can also aid your business.

Not only can it help change any wasteful attitudes of employees but it can also have tangible benefits on the profit margin of your company.

And it has never been more important to save money. The last few years of economic uncertainty has left countless businesses in Britain and around the world struggling to survive – but the evidence is there that energy efficiency can help achieve this. For example, Volvo’s New River Valley Plant in Virginia, the world’s largest truck manufacturer, invested around £550,000 in saving energy prior to the recession and has now saved £1.31 million on their bills and avoided having to fire any staff.

Whether you are adopting an nPower business plan to reduce costs or are simply looking to do your bit for the environment, read on to find out why investing in energy efficiency is the right choice for your company.

No longer hostage to price rises

Like death and taxes, increases in energy prices are all but guaranteed in the future. However by improving your efficiency and thereby reducing your usage, you will help mitigate the damage of price hikes further down the line.

Eco-market is booming

A company can’t buy the kind of positive publicity green policies can drum up for your business. Taking action to reduce your carbon footprint will not only make your company appear socially responsible but could also attract investment from previously untapped markets.

Additionally, investing in energy efficiency can set you apart from the pack and help foster a sense of economy amongst your workforce.

Safe as houses

Investing in energy efficiency is one of the few times in life when you know roughly what benefits your money will generate for you. Unlike turbulent stock markets or frugal bank accounts, saving money through more effective energy use is simple maths. If you use less energy at the same rate then ultimately you will lower your monthly costs – a winning situation in anyone’s books.

More profits, more investments

Improved energy efficiency can help reduce the weight power costs can have on your company’s finances, ultimately allowing you to invest in growing your business rather than only paying your existing bills. This will not only help your competitiveness but could allow you to further invest in green technology, creating a self-fulfilling reduction in energy costs.

Incentivised

Replacing office equipment can drain valuable resources. Investing in more energy efficient technology, even if it is initially more expensive, will usually be worth it in the long term. Green technology is improving every year, with the Energy Star rating system (http://www.energystar.gov/) the simplest way to find the best equipment for you. Finally, energy efficient equipment is often more durable than existing office items, thereby helping to reduce maintenance and future purchase costs.

What have you done to make your business more energy efficient?

Mikael Johansen is a blogger and freelance writer working with a variety of brands. This post has been written for an energy supplier npower. 

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