Business
Five worthwhile investments
for expat educators
By Aaron Crotty
A
s discussed in previous
articles, structured financial
planning is essential to
achieving
our
financial
goals. Identifying, planning and
reviewing our financial goals on a
regular basis will ensure that we
are best prepared for the future.
It is very important to diversify our
financial plans to spread risk in
order to build a strong portfolio of
assets. In this article, I would like to
demonstrate the 5 most popular
investment strategies identified
with my existing clients.
Retirement planning
Although this could seem a long
way off for some, the reality is
that retirement planning is one of
the most important investments
we will make. The sooner you get
started the easier life becomes
for you and your family. You also
have a greater chance of reaching
your retirement goal as compound
interest starts to become a huge
benefit in the process. Regardless
of your life stage, a secure
comfortable retirement is a goal
that every individual works towards.
The general rule of thumb for
contribution towards retirement is
between 8-10% of monthly salary.
Children’s future education
planning
Parents always want the best start in
life for their children. What greater
gift or benefit is there than a good
education? In an increasingly
competitive world, securing a
good career is more difficult than
it ever was. It is natural to want to
provide your child with the best
possible education to give them
every chance to succeed. Tuition
fees have steadily increased over
the years. The cost of tuition is
now a major expense, and if left
unmanaged can be a huge drain
on your resources when the time
comes. Planning for this particular
aspect of your children’s future is
absolutely vital, so as to ensure
adequate funds are in place to
meet these costs, especially if you have
more than one child. In today’s terms,
jurisdictions such as the UK & US have
a total average cost of about $120,000
per 4-year course.
International real estate
Another very common offshore
investment is that of international real
estate. Some individuals merely want
to put money into a new commercial
property or the development of a
beachfront community, but others will
want to purchase real estate for their
own needs. Among retirees, this is an
especially popular choice, as they can
utilize the property as a second home
or even a full-time residence.
Offshore life insurance
Life insurance is chosen based on the
needs and goals of the contract owner.
It can buy those you love the time to
grieve. It can pay off your outstanding
debts. It can provide your dependents
with on-going income to replace yours
until they can live comfortably without,
and can keep your family in their home.
It also provides a timely emergency
fund for medical, legal and funeral
costs, should your beneficiaries not
have adequate income to cover them.
Start with imagining yourself gone
tomorrow. What would the impact be?
Is your family counting on your income
in the coming years to cover the basic
cost of living? Could your family afford
the funeral expenses? Do you have
assets that would be hugely impacted
by inheritance tax?
Lump sum investment
For those who are lucky enough
to have accumulated savings over
the course of their working career,
it is important to preserve buying
power. With global inflation currently
growing at an average of 3% per year,
it’s essential to gain the same return
of growth. Simply put, if a $100,000
cash investment is getting a return of
1% per year, it is losing 2% purchase
power each year to inflation.
To connect with Aaron, email aaron.crotty@
arloassociates.com