However, with this independence comes the responsibility of managing your funds wisely and planning for the future. Choosing the best investment options for self-employed professionals like you is a critical component.
These investments can significantly impact your financial journey, allowing you to develop your money, safeguard your future, and achieve your long-term objectives. Read on if you want to secure your future along with doing what you like to do.
5 Best Investing Options for Self-employed Professionals
Let's explore the top 5 investment options perfect for self-employed individuals like yourself. Whether you are a freelancer, entrepreneur, or gig worker, these alternatives can help you grow your wealth. So, let's dive right in!
1. Solo 401(k) or Individual 401(k)
A Solo 401(k), also known as an Individual 401(k), is a retirement plan established exclusively for self-employed persons who do not hire anyone else or for those who only employ their spouse. So if you come under any of these categories, this is “the plan” for you.
When compared to other retirement plans, it has more significant contribution limits and allows you to make both company and employee contributions. Also, contributions to a Solo 401(k) are tax-deductible, and gains accumulate tax-free until retirement. So, you can save more for retirement, especially if your income is on the higher side.
The 401k withdrawal rules after age 59 are also beneficial. For instance, one of them allows you to withdraw from your old accounts without penalties once you are 59 ½.
2. Health Savings Account (HSA)
A Health Savings Account (HSA) is a tax-advantaged savings account for those with high-deductible health insurance coverage. Eligible medical withdrawals from your HSA account and the growth of your HSA funds are tax-free. Moreover, your contributions are tax-deductible.
While an HSA is mainly intended to pay medical bills, it may also be used as an investment vehicle. How? Well, you can withdraw your money from HSA for any purpose after you are 65 years old. Although it is not tax-free, the tax rate for withdrawal for non-medical purposes is ordinary.
This makes it an appealing retirement investment option for self-employed persons like you looking to save for healthcare expenses while benefiting from possible investment gains.
3. Simplified Employee Pension (SEP) IRA
A Simplified Employee Pension (SEP) IRA is a type of retirement plan for self-employed people and small company owners. There is no minimum number of employees required to invest in ESP IRA.
You can invest in this option even if you are a sole proprietor with no employees, as the employer only contributes to the SEP IRA. You can contribute up to 25% of your net self-employment income or a maximum of $66,000 (for 2023).
SEP IRAs are an excellent solution for entrepreneurs who wish to maximize their retirement savings while minimizing administrative responsibilities. Contributions to a SEP IRA are tax deductible, and gains accumulate tax-free until retirement.
4. Taxable Investment Accounts
While retirement accounts provide tax benefits, you can also consider investing in taxable investment accounts. These funds do not give the same tax advantages as other retirement investment options for self-employed do. But they offer greater flexibility and accessibility.
That means although your investment returns will be subject to capital gains taxes, taxable accounts will give liquidity and the opportunity to withdraw cash without fines or limits. Also, the interest earned can compensate for your tax expenses. However, you must invest in these options with utmost caution and after gaining considerable market knowledge.
Taxable investment accounts enable you to invest in a variety of assets, such as mutual funds, exchange-traded funds, stocks, bonds, etc.
5. Individual Retirement Accounts (IRAs)
Individual Retirement Accounts (IRAs) are another popular investing vehicle for self-employed people. Traditional IRAs and Roth IRAs are the two primary forms of IRAs.
IRAs (Traditional IRAs): Traditional IRA contributions are tax-deductible, which means you may lower your taxable income in the year you contribute. Retirement withdrawals, on the other hand, are taxed like regular income. Traditional IRAs are a good option if you expect to be at a lower tax rate when you retire.
Roth IRAs: On the other hand, Roth IRAs provide for tax-free retirement withdrawals. While Roth IRA donations are not tax-deductible, gains grow tax-free, and eligible withdrawals are not taxed. If you anticipate being in a higher tax rate during retirement, Roth IRAs are favourable.
The good thing is that as long as the funds remain in your account, you don’t need to pay any taxes on the interest you earn on your funds in both types of IRAs.
As a self-employed person, you must take charge of your financial future. Consider these best investing options for self-employed people like you to secure your financial goals and prepare for a comfortable retirement. (Source: Trending Impact)
Remember that each investment choice has its own set of benefits and drawbacks. It's critical to assess your situation and talk with a financial counsellor to identify the best investment strategy for your unique requirements. Begin today to lay the groundwork for a financially secure tomorrow.
This type of investment allows investors to earn income from the interest and principal payments made by borrowers. At the heart of this subject is the understanding that mortgage funds, unlike individual mortgages, diversify risk across a variety of loans, and therefore, provide a different level of security for the invested capital.
It's essential for investors to fully understand these dynamics, as they can significantly impact investment strategy and overall financial health. Recognizing this need for clarity, the upcoming sections of this document aim to offer insightful and educational content on the intricate world of mortgage fund investing.
What is a Mortgage Fund?
A mortgage fund is a type of investment fund that pools capital from various investors to lend it as mortgages to homebuyers or real estate investors. The fund earns returns from the interest and principal payments made by borrowers on these mortgages. Just as a mutual fund provides diversification in the stock market, a mortgage fund provides diversification in the real estate market. This is because the fund's capital is spread across a multitude of mortgages, which minimizes the risk associated with any single loan. Investing in Mortgage Funds can offer several benefits.
First, they often provide steady income streams due to the regular mortgage payments made by borrowers. Second, since these funds are backed by real assets (i.e., property), they can offer a degree of protection against inflation. Finally, they diversify an investor's portfolio, as the real estate market can behave differently from other investment markets like stocks or bonds. In the case of first mortgage investments, you should be aware that mortgage fund investments can be highly illiquid assets and may require a long-term commitment. As with any investment, it's essential to carefully consider the potential risks and consult with a financial advisor before making a decision.
Diversification of Risk
Diversification of risk, in the context of mortgage fund investing, refers to the practice of spreading investment capital across numerous loans or properties. This is done to mitigate the potential for significant losses arising from any single mortgage default or property value decline. Just as a balanced diet provides a range of nutrients to support overall health, a diversified mortgage fund provides a range of investments to support overall financial health.
By not "putting all eggs in one basket", investors can manage the risk associated with the unpredictable nature of the real estate market. In terms of its influence on the mortgage fund investing process, diversification fundamentally changes how investors approach risks. Instead of assessing the risk of each mortgage or property, investors assess the overall risk of the pool of mortgages.
This allows for a more robust and resilient investment strategy, as the negative impact of a single underperforming mortgage can be offset by the performance of other mortgages within the pool.
The Role of Mortgage Fund Managers
These professionals are responsible for managing the pool of mortgages and making strategic investment decisions to maximize investor return while minimizing risk. They perform an array of duties, including the selection of mortgages for the fund, assessment of loan-to-value ratios, borrower credit analysis, and the monitoring of real estate market trends and economic indicators. Moreover, mortgage fund managers serve as the key interface between investors and borrowers. They manage investor contributions, distribute returns, and handle the necessary administrative procedures.
These managers also have a role in maintaining the liquidity of the fund, ensuring that investors can enter or exit the fund as per their investment objectives. The proficiency of a mortgage fund manager can greatly affect the performance of the fund. A skilled and experienced manager, with a keen understanding of the real estate market and financial strategies, can adeptly navigate market fluctuations and make prudent investment decisions.
Investment Returns
These returns can be generated from income (such as interest or dividends), capital gains (such as an increase in the value of the invested capital), or a combination of both. In the context of mortgage fund investing, returns generally come from the interest and principal repayments made by borrowers on the loans within the fund. Investment returns are a crucial aspect of the mortgage fund investing process. They serve as a measure of the profitability of the fund and can significantly influence an investor's decision to invest.
Higher returns can make a fund more attractive to investors, while lower returns may deter investment. It's important to note, however, that higher returns often come with a higher level of risk. Therefore, potential investors should carefully consider their risk tolerance and investment objectives before committing their capital.
Risks and Considerations
These may include interest rate risk, default risk, and liquidity risk. Investors need to understand these risks before investing. Interest rate risk refers to the potential for changes in interest rates to impact the returns of a fund. When interest rates fall, the return on investments may decrease and vice versa. Default risk is associated with borrowers failing to make payments on their loans. If this occurs, it can hurt the fund's returns. Lastly, liquidity risk relates to an investor's ability to access their capital.
Mortgage funds typically have a longer lock-up period than other investments, so investors should consider their liquidity needs before investing. Additionally, mortgage fund investments are not insured by the FDIC or any other government agency and may be subject to additional taxes and fees.
Types of Mortgage Funds
Various types of mortgage funds cater to different investment objectives and risk tolerance levels. Some focus on residential mortgages, while others invest in commercial mortgages or a mix of both. Some funds specialize in specific geographical areas or types of property. It's important to understand the different types of mortgage funds and choose a fund that is well-suited to your particular investment objectives. Most importantly, don't be tempted to take on more risk than you're comfortable with.
Mortgage fund investing can offer investors the potential for attractive returns and diversification of risk. While it does involve risks that should not be overlooked, a well-managed mortgage fund can effectively manage those risks to maximize returns while minimizing losses. By carefully researching the different types of funds, understanding the associated risks and returns, and selecting a fund that is suited to their needs, investors can position themselves to capitalize on the opportunities offered by mortgage fund investing.
Ultimately, a successful investment strategy should be tailored to each investor's risk tolerance and investment objectives. With an informed approach to mortgage fund investing, investors can gain access to an attractive and profitable investment opportunity.
Gold is a safe asset that has been around for centuries, and with its ability to help preserve wealth in times of economic uncertainty, it can provide many benefits for those looking to build up their savings and hedge against market volatility. In this blog post, we'll take a look at why gold investment is an important part of creating a balanced portfolio, as well as what kind of strategies can make it successful.
We'll discuss how gold's performance measures up to other assets such as stocks and bonds, offer insight into where you buy gold from and give advice on when is the best time to invest in it. Read on if you want to learn more about using precious metal investments as part of your overall strategy for securing long-term growth!
Overview of gold as an investment asset and its benefits
Gold has been a sought-after precious metal for centuries, not only for its aesthetic appeal but also for its value. Investors worldwide value gold as a safe asset, due to its ability to hold its value even during times of economic uncertainty. Unlike stocks or mutual funds, gold is a physical asset that can be held and stored, making it an attractive option for those who prefer tangible investments.
Additionally, gold is widely recognized and accepted globally, making it an easy asset to liquidate if needed. With its stability and consistent track record, it's no wonder why many investors choose to include gold in their investment portfolios.
The importance of diversifying your financial portfolio with gold investments
Investing in gold has proven to be a smart decision for many savvy investors. It's not uncommon to hear financial experts suggest diversifying your portfolio with gold. Why? Well, gold is considered a safe asset in times of economic uncertainty. It can act as a hedge against inflation and even currency fluctuations.
Unlike stocks or bonds, gold doesn't necessarily rely on the success of a particular company or government, making it a valuable addition to any portfolio. By diversifying your investments with gold, you're spreading out your risk, which can help protect your wealth over the long run. With all of the benefits that come with investing in gold, it's certainly worth considering as part of your overall financial strategy.
Researching Gold Investment Options
With so many gold investment options available, where do you begin? A good place to start is by researching the different types of gold investments, such as physical gold, exchange-traded funds (ETFs), and mining stocks.
It's also important to understand the risks and benefits associated with each option. When it comes to investing in gold, many investors choose to do so through a precious metals IRA. In this case, it's important to find reputable precious metals IRA companies that can help guide you through the process and ensure your investment is secure. Overall, with the right knowledge and reputable guidance, investing in gold can be a lucrative addition to your investment portfolio.
Investing in Digital Gold – Exchange Traded Funds (ETFs)
Exchange-traded funds (ETFs) offer a convenient and accessible option for investors when it comes to investing in digital gold. With the emergence of cryptocurrencies, digital gold has gained traction as a valuable alternative to traditional gold. Unlike traditional gold, digital gold can be easily traded and stored, making it an efficient investment option for those who seek to diversify their portfolios.
ETFs provide a low-cost way to invest in digital gold, with the added benefits of liquidity and the ability to trade on major exchanges. Digital gold ETFs offer investors a chance to participate in the growing market of digital assets and should be considered a valuable addition to investment strategies.
In the end, gold is an attractive investment option for investors seeking to diversify their financial portfolios and protect against the risk of inflation. Investing in gold has several advantages but it’s important to take into account the potential risks involved in making a gold investment. Before deciding to invest in gold, it is important to understand the various investment options available as well as the pros and cons associated with each.
Whether you choose physical gold through bullion coins or bars, digital gold through ETFs, or any combination thereof, make sure you do your research and weigh your options thoroughly so that you can make an informed decision that best meets your financial objectives. So go out there and start investing in gold today to secure a brighter tomorrow for yourself!
One avenue that has gained immense popularity in this transition is futures trading. It is important to note that answering the question "what are futures?" is the most basic step in exploring the futures trading landscape. This article, however, delves into how individuals can effectively capitalize on futures investing/trading within the digital financial era, exploring key strategies and considerations.
Embracing digital platforms
The advent of the digital era has opened up the financial markets to investors of all experience levels. Online trading platforms have transformed futures trading due to the availability of real-time data, user-friendly interfaces, and the speed with which deals may be executed.
Futures trading has become more accessible to would-be investors since they can now set up accounts, conduct research, and make transactions without leaving their homes. However, choosing a trustworthy and simple-to-use platform that supports your trading goals and equips you with the resources you need for research and risk management is essential.
Leveraging technology
Futures trading today relies heavily on technological advancements that help traders make better selections and, more precisely, carry out their strategy. Data analytics software can sift through mountains of data to reveal patterns that can then be used to guide business choices. Further on this concept, algorithmic trading uses specified criteria to execute deals automatically.
Traders may take advantage of pricing differences, arbitrage possibilities, and market inefficiencies with the help of technological advancements. However, keeping abreast of the algorithms in use and making necessary adjustments when market circumstances change is crucial.
Risk management and education
The transition from Wall Street to Web Street has dramatically altered how people interact with financial markets, especially in futures trading. While it has brought forth exciting opportunities, it has also amplified the need for effective risk management. Financial market volatility has the potential for both profits and losses. An awareness of futures trading basics, risk management techniques, and market-moving fundamentals is essential for financial success. An effective risk management strategy will include diversification, stop-loss orders, and appropriate position size.
In conclusion, embracing digital platforms, harnessing the power of technology, and prioritizing risk management are key factors that can contribute to successful futures investing/trading in the digital financial era. However, as you embark on this thrilling adventure, remember that the best tools for negotiating wall street's ever-changing terrain are a thirst for knowledge, a willingness to change with the times, and a clear trading plan.
Beyond the bustling trading floors and high-stakes negotiations lies a realm where the well-being of employees and the protection of assets merge seamlessly with business excellence. In this article, we unveil the essential components of a robust health and safety framework tailored specifically for investment firms. From ergonomic workspaces to cybersecurity protocols, join us as we delve into the 8 key elements that ensure a harmonious symphony between wealth accumulation and employee welfare.
Regulatory Compliance and Legal Framework
In the context of health and safety management within investment firms, adherence to regulatory compliance and a robust legal framework stands as the cornerstone of a secure and responsible operational environment. Investment firms must meticulously navigate through an intricate web of industry-specific regulations and legal obligations, ranging from financial sector laws to occupational health and safety standards.
By rigorously upholding these mandates, firms ensure the protection of their employees, clients, and stakeholders, while fostering a culture of transparency and accountability. A comprehensive approach to regulatory compliance forms the bedrock of a resilient health and safety management system, safeguarding the firm's integrity and sustaining long-term success.
Employee Training and Competency Development
Employee training and competency development form an essential pillar of health and safety management within investment firms. For instance, the NEBOSH National Diploma course on occupational health and safety ensures that employees gain the knowledge and skills necessary to navigate potential hazards, adhere to safety protocols, and respond effectively to emergencies. These initiatives encompass a wide spectrum, including workshops on risk assessment, first aid, cybersecurity awareness, and crisis management.
By fostering a culture of continuous learning, investment firms empower their workforce to proactively contribute to a secure and health-conscious environment. This commitment not only enhances individual capabilities but also collectively strengthens the firm's ability to maintain a resilient and protected operational landscape.
Risk Assessment and Mitigation Strategies
Effective risk assessment and meticulous implementation of mitigation strategies are paramount in the realm of health and safety management within investment firms. Rigorous evaluation of potential hazards, whether they arise from technological vulnerabilities, market fluctuations, or physical workplace conditions, enables proactive identification and quantification of risks.
Subsequently, tailored mitigation plans are devised and executed, encompassing preventive measures, contingency plans, and crisis response protocols. By employing this systematic approach, investment firms bolster their resilience against unforeseen challenges, safeguarding not only the well-being of their personnel but also the integrity of their operations and the interests of their clients and stakeholders.
Emergency Response Planning and Preparedness
Emergency response planning and preparedness constitute a critical facet of health and safety management within investment firms. Meticulously crafted response strategies, encompassing scenarios ranging from natural disasters to cybersecurity breaches, ensure a swift and coordinated reaction in times of crisis.
By conducting regular drills, simulations, and training sessions, firms equip their staff with the skills to effectively manage emergencies, minimizing potential harm and operational disruptions. Such proactive measures foster a culture of readiness, enabling investment firms to navigate adversity with poise, protect their assets, and maintain the trust of clients and stakeholders.
Workplace Ergonomics and Physical Wellbeing
Prioritizing workplace ergonomics and promoting physical well-being is pivotal in the holistic health and safety management of investment firms. By optimizing office layouts, furnishings, and equipment, firms ensure that employees operate in ergonomic environments that reduce the risk of musculoskeletal disorders and other physical ailments.
Regular health initiatives, such as wellness programs, fitness facilities, and health screenings, empower employees to maintain their physical vitality. A balanced focus on ergonomics and physical well-being not only enhances individual comfort and productivity but also fosters a culture of care, promoting long-term employee satisfaction, retention, and overall organizational success.
Information Security and Data Privacy
Preserving information security and upholding data privacy stands as paramount consideration in the health and safety management of investment firms. Robust cybersecurity measures, including encryption, access controls, and intrusion detection systems, safeguard sensitive data against cyber threats. Stricter data handling practices and compliance with privacy regulations, such as GDPR or HIPAA, assure clients and stakeholders of their confidential information's protection.
Regular audits, employee training, and incident response plans contribute to a fortified defense against data breaches. By maintaining a vigilant stance on information security and data privacy, investment firms bolster trust, prevent reputational damage, and ensure the continuity of their operations.
Mental Health and Stress Management Initiatives
Championing mental health and implementing stress management initiatives is of paramount importance in the health and safety management strategy of investment firms. Recognizing the demands of a fast-paced industry, firms prioritize employee well-being through counseling services, flexible work arrangements, and mindfulness programs.
By promoting an open dialogue surrounding mental health, reducing stigma, and providing resources for stress reduction, firms create a supportive and inclusive environment. These initiatives not only enhance employee morale and engagement but also mitigate burnout and bolster overall resilience. Investing in mental health reaffirms a commitment to the holistic welfare of staff, fostering a culture of balance and sustained performance.
Continuous Improvement and Performance Monitoring
Embracing a philosophy of continuous improvement and diligent performance monitoring forms a cornerstone of health and safety management within investment firms. Regular assessment of safety protocols, incident analyses, and feedback loops contribute to refining existing processes and anticipating potential challenges. Through Key Performance Indicators (KPIs) and benchmarking, firms gauge the efficacy of their safety initiatives, identifying areas for enhancement.
The data-driven approach not only facilitates proactive risk mitigation but also enables a responsive adjustment to evolving circumstances. By fostering a culture of adaptability and refinement, investment firms ensure the perpetuation of a secure and resilient operational landscape, underpinning their commitment to the well-being of employees and the organization at large.
The comprehensive integration of these key elements in health and safety management fortifies investment firms against a spectrum of challenges. By navigating regulatory complexities, nurturing employee well-being, and diligently addressing risks, firms cultivate an environment of security and accountability. The synthesis of ergonomic considerations, information protection, mental health support, and a culture of continuous improvement not only safeguards personnel but also enhances operational integrity. As investment firms prioritize these facets, they foster resilience, inspire confidence among stakeholders, and affirm their dedication to fostering a secure, sustainable, and thriving ecosystem for their employees and the organization as a whole.
However, like any financial decision, investing comes with both benefits and risks.
In this article, we'll explore the pros and cons of investing to help you determine if it's a good idea for you.
The Pros of Investing:
1. Potential for Growth: Investing in assets such as stocks, bonds, and real estate offers the potential for substantial long-term growth. Historically, these assets have outpaced inflation and provided attractive returns.
2. Wealth Building: Investing allows individuals to grow their wealth over time, creating financial security for retirement, education, or other significant life events.
3. Diversification: By diversifying your investments across various assets and industries, you can spread risk and reduce the impact of market volatility.
4. Compound Interest: Over time, compound interest can significantly boost your investment returns. Reinvesting earnings generates a snowball effect, leading to accelerated growth.
5. Tax Advantages: Certain investment accounts, such as ISAs and SIPPs in the UK, offer tax benefits, allowing you to keep more of your investment gains.
6. Beat Inflation: Investing can potentially outpace the rate of inflation, preserving your purchasing power and ensuring your money grows in real terms.
The Cons of Investing:
1. Risk of Loss: All investments carry some degree of risk, and there is no guarantee of positive returns. The value of investments can fluctuate, and you may lose some or all of your initial investment.
2. Time and Research: Successful investing requires time, research, and monitoring. It's essential to stay informed about market developments and make well-informed decisions.
3. Emotional Challenges: Market fluctuations and short-term volatility can evoke emotional responses, leading to impulsive decisions that may impact long-term gains.
4. Potential Complexity: Some investment options, such as individual stocks or complex financial products, may be challenging for beginners to understand and manage effectively.
5. Liquidity Constraints: Certain investments may have restrictions on when and how you can access your funds, limiting liquidity in the short term.
Get Started With Investment Apps
Investing may feel intimidating, particularly for beginners, but technological advancements have made it more approachable through investment apps.
These apps have simplified the process, making it user-friendly and accessible.
With investment apps, you can effortlessly monitor your investments, allocate funds to various assets, and track your portfolio's performance.
Notably, some apps provide educational resources to enhance your understanding of investing.
The added benefit of managing your portfolio on the go makes investment apps an appealing choice for those venturing into the investment realm.
As outlined in this best investing apps UK guide, these platforms offer a convenient and informative way to navigate the world of investing.
Conclusion
Whether investing is a good idea depends on your financial goals, risk tolerance, and time horizon.
While investing offers potential for growth and wealth building, it comes with inherent risks and requires careful consideration.
For individuals with a long-term outlook and willingness to weather market fluctuations, investing can be a powerful tool to achieve financial success.
However, it's crucial to educate yourself, seek professional advice, and maintain a disciplined approach to investing.
Ultimately, the decision to invest should align with your financial circumstances and aspirations.
Passenger Secures a £15M Investment from Growth Partner
About the Deal
DWF provided legal advice to Growth Partner on its £15 million investment in clothing brand Passenger.
Founded in 2012 by Richard and Alexa Sutcliffe, Passenger is a rapidly-growing outdoor clothing brand with a focus on sustainability. Passenger plants a tree for every order it receives and ensures that over 90% of its product portfolio is made with lower-impact materials such as hemp, organic cotton, and recycled cotton and polyester. The firm is set to achieve revenue of £50 million in 2023.
Consumer-specialist investment firm Growth Partner is taking a significant minority stake in Passenger as part of its domestic and international growth strategy. Former Gymshark chief executive Steve Hewitt, who is investing alongside Growth Partner, will become chairman of Passenger, while Growth Partner investment director James Worrall will join the board as non-executive director. Whanau Advisory, a firm founded by Steve Hewitt and including a number of former Gymshark executives, will become a strategic advisor to Passenger.
DWF advised Growth Partner with a team led by partner Will Munday and senior associate Francesca Kinsella.
An Interview With Will Munday from DWF
Can you tell us more about the role that your team played during this investment?
I have worked with James Worrall for many years, but this was our first instruction from Growth Partner. Our market-leading regional corporate team has deep-rooted venture capital and retail sector expertise, so the chance to assist Growth Partner with its investment in Passenger was a particularly exciting opportunity that played to our strengths.
We got involved at the heads of terms stage and assisted Growth Partner in preparing the key legal terms included in the initial offer letter. Once the heads of terms were agreed, we carried out a focused legal due diligence exercise on the specific areas of concern for Growth Partner. As would be expected, ESG was a key area of our due diligence review and our specialist regulatory team, led by partner Dominic Watkins, added real value here. Next, we prepared and negotiated the key transaction documents – sale and purchase agreement, shareholders’ agreement and new articles of association – as well as the various ancillary corporate documents.
Deal management was of particular importance on this transaction as there was a challenging timetable and the team had to negotiate with Passenger’s advisers and advisers for the co-investor, Whanau Advisory. Francesca, the senior associate on the deal, should be singled out for particular praise as she managed an extremely efficient process that involved negotiating with multiple parties at any one time.
What unique skills and experience did you bring to bear as part of your work on this transaction?
DWF’s corporate team has a particular specialism in private equity and venture capital investments. With a team of over 30 lawyers in the North, we are recognised for our skill in combining legal expertise within the PE market with a distinctively energetic, decisive and clear approach. This market knowledge was vital in the smooth running of the transaction and enabled us to deliver commercial and pragmatic advice to Growth Partner in order to achieve a successful and timely completion.
We use technology to make the administrative and burdensome elements of transactions simpler and more efficient. A good example is our bespoke platform ‘DWF Diligence’ that we have developed to help streamline and manage the due diligence process. On the Passenger transaction it was of great value in light of the challenging timetable as it ensured the legal due diligence was carefully scoped, planned and executed. It allowed multiple users, including lawyers from various other practice areas, to access and update the legal due diligence report at the same time. Further, we were able to use real time reporting to present up-to-date progress and key information to Growth Partner in visualisations which allowed us to resolve identified issues quickly.
How did you work with your clients and other involved counsel to ensure a satisfactory outcome for all involved?
In our view, clients choose legal advisers based on ‘feel’ and ‘chemistry’. They want to know that their legal advisers will fight for their best interests, be a dedicated resource which is available when needed and engage with them in a straightforward and yet professional manner. This was our approach with Growth Partner and the team was able to develop a strong working relationship with James very quickly through regular communication at all levels.
As this was a significant investment for Growth Partner, albeit a minority stake, there was particular focus on negotiating the appropriate investor protections. This led to some suitably robust negotiations, but we were able to work together effectively with lawyers for Passenger (Osborne Clarke) and Whanau Advisory (Gateley Legal) to agree the key transaction documents and ensure Growth Partner’s interests as an investor were appropriately protected.
Quercus Corporate Finance advised the shareholders of Future Industrial Services (FIS) on the sale of the company to waste and resource management group, Augean.
FIS is a Liverpool-headquartered provider of hazardous waste management and specialist industrial services with branches in Rugby, Hull, Plymouth, Honiton and Berwick. The firm’s client base includes government bodies, major utilities and national and multinational corporations, and its operations extend across five waste processing, treatment and recovery sites – among them the UK’s only mercury recovery facility.
Acquired by Ancala Partners and Fiera Infrastructure in October 2021 in a £390 million deal, Augean is a Wetherby-based group that boasts 23 sites across England, Wales and Scotland. FIS chief executive David Lusher lauded the combination of the two companies in a statement. “I am incredibly proud of the FIS team and their clear focus on making us a better business for our customers, investors, employees and the environment,” he said. "It is important that the company we have built up together continues to flourish and grow. That ambition has culminated in becoming part of the Augean Group today."
Quercus Corporate Finance advised the FIS shareholders with a team led by partner Mark Whelan and associate partner Neil Giles.
An Interview with Mark Whelan at Quercus Corporate Finance
Please give us some background into this transaction and the role that your team played.
Quercus acted as joint M&A advisers to FIS and NorthEdge, alongside EY Manchester, on the sale of the company to Augean. This involved preparing the business for sale, identifying and engaging with buyers and negotiating an agreed deal.
I had a prior relationship with David Lusher and Colin Stirling, FIS CEO and Chairman respectively, for a number of years and helped David to put together the MBO when David and NorthEdge acquired the business in 2017, so it was a real pleasure to have the opportunity to work with them again. Conversely, this was our first sale for NorthEdge and I am extremely grateful to Andy Ball and John Hammond for trusting us with this important exit.
What unique skills and professional experience did you draw upon as part of your involvement in this transaction?
Our philosophy at Quercus is to develop deep, proprietary knowledge in our chosen sectors, and our demonstrable experience in and around the circular economy was very important on this transaction. It meant that we understood precisely where FIS sits in the waste value chain and hence, we could best position the business in the market.
Our strong relationships with all the industry players at a senior level were also extremely valuable in approaching and engaging with potential buyers.
When advising on sales of this nature, what are the key considerations that you take into account?
Firstly, we only take on mandates where we think we can add value and deliver a successful outcome. As an independent owner-managed business, Quercus does not operate a portfolio business model, so deal completions are very important to us!
Every sale throws up different challenges, but the key consideration is always the client’s objectives. Many naturally want to maximise value whilst others are looking for a good home for a lifetime’s work. Ultimately, we want to create options for our clients and in our experience that is only possible on the back of high-quality preparation, so that is a big area of focus for us.
Did you encounter any significant challenges during the course of this transaction? How did you overcome them?
FIS is an exciting and fast-growing business, built on both acquisitive and organic growth initiatives. Our preparation for a sale coincided with a particularly strong period of organic growth, with some important new customer wins along with recovery from the effects of the COVID-19 pandemic. In addition, FIS continued its track record of strategic acquisitions with a highly complementary bolt-on to the Honiton business mid-way through the process. As a result, we had to carefully analyse and then articulate that growth and future upside to potential buyers to ensure that their valuations of the business properly captured that growth, rather than looking backward at historic results. We believe that we achieved this and got the buyers to focus on the right value drivers.
In what ways would you say that your work as a part of this deal fits the profile of your firm?
The sale of FIS is a very good example of the type of work Quercus targets as a firm. We are sell-side specialists with significant buy-side and capital raising expertise. We also have a particular specialism in the waste and recycling sector built on my 30 years of working in and as advisor to that sector. Our value proposition is very much built around our experience, expertise and international reach, and all three were very important on this transaction, especially our deep waste sector knowledge and our relationships with the key industry players.
What impact do you expect this deal to have on Augean and FIS, or on the UK waste management sector more broadly?
The coming together of both businesses will undoubtedly benefit both FIS and Augean and their respective employees as the strategic fit is strong, with plenty of opportunity to leverage each party’s strengths. More broadly, the deal is undoubtedly an important sector milestone because it demonstrates the important role that mid-market private equity investors like NorthEdge can play in helping to shape and develop the sector.
The deal has generated a lot of enquiries for Quercus from other waste operators looking to realise value and I am confident that the sector will remain busy. If you will forgive the pun, the Future is bright.
These user-friendly applications empower individuals to take control of their financial future and participate in the world of investing. In this article, we will explore the steps and considerations involved in using investing apps effectively to maximize your financial growth.
Research and Select the Right App
Start by researching and selecting an investment app that aligns with your investment goals, risk tolerance, and preferences.
Consider factors such as user interface, available investment options, fees, customer support, and security features.
Popular investing apps include Robinhood, Acorns, TD Ameritrade, and E*TRADE.
Create an Account
Download the chosen investing app and follow the account creation process.
You will typically be asked to provide personal information, complete identity verification, and agree to the terms and conditions.
Be sure to read and understand the app's policies, including its fee structure and privacy measures.
Set Investment Goals
Define your investment goals based on your financial objectives, time horizon, and risk tolerance. Are you saving for retirement, a down payment on a house, or simply looking to grow your wealth? Clearly outlining your goals will help guide your investment decisions.
Understand Investment Options
Familiarize yourself with the various investment options offered by the app. These may include stocks, bonds, exchange-traded funds (ETFs), mutual funds, or even cryptocurrencies. Learn about the risks, potential returns, and historical performance of each investment type.
Educate Yourself
Before diving into investing, take the time to educate yourself. Many investing apps offer educational resources, articles, and tutorials to help you build your knowledge and make informed decisions. Additionally, consider reading books, attending seminars, or following reputable financial websites to expand your understanding of investing.
Determine Your Investment Strategy
Choose an investment strategy that suits your goals and risk tolerance. Some popular strategies include long-term investing, value investing, growth investing, or index fund investing. Each strategy has its approach and level of risk, so select one that aligns with your preferences.
Start with Small Investments
If you are new to investing, consider starting with small amounts to gain experience and confidence. Many investing apps allow you to invest fractional shares, making it possible to invest even with limited funds. As you become more comfortable and knowledgeable, you can gradually increase your investment amounts.
Monitor and Adjust
Regularly monitor your investments and stay informed about market trends and economic news. Investing apps often provide real-time updates, performance reports, and research tools to assist you in tracking your portfolio. Periodically review your investments and make adjustments as needed to stay aligned with your goals.
Stay Disciplined
Emotional discipline is crucial when investing. Avoid making impulsive decisions based on short-term market fluctuations. Stay focused on your long-term objectives and avoid the temptation to constantly buy or sell based on market volatility.
Seek Professional Advice if Needed
If you feel overwhelmed or uncertain about your investment decisions, don't hesitate to seek professional advice. Financial advisors can provide personalized guidance based on your unique circumstances and help you navigate the complexities of investing.
Drawbacks of Using Investing Apps?
While investing apps offer convenience and accessibility, it's important to be aware of potential concerns and drawbacks associated with their usage.
Here are a few considerations to keep in mind:
Limited Human Interaction: Investing apps often rely on automated algorithms and technology-driven platforms, which means you may have limited or no direct human interaction with financial advisors. This can be a drawback if you prefer personalized guidance or have complex financial situations that require expert advice.
Risk of Overtrading: The ease of buying and selling investments through apps can lead to a temptation to engage in frequent trading. Overtrading can increase transaction costs and potentially harm long-term returns. It's important to maintain a disciplined investment strategy and avoid making impulsive decisions based on short-term market fluctuations.
Potential Security Risks: While reputable investing apps prioritize security, there is always a risk of cybersecurity threats and data breaches. Make sure to choose apps with robust security measures and follow best practices, such as using strong passwords and enabling two-factor authentication, to protect your sensitive information.
Technical Issues and Downtime: Like any technology-driven platform, investing apps can experience technical glitches or downtime, which may temporarily restrict your access to your account or affect the execution of trades. While these issues are usually resolved quickly, they can be inconvenient if they occur during critical market moments.
Overreliance on Apps: Relying solely on investing apps for financial decision-making can lead to a lack of diversification in your investment portfolio. It's important to consider a holistic approach to financial management and seek professional advice when needed to ensure your investment strategy aligns with your overall financial goals.
It's important to weigh these concerns against the benefits offered by investing apps.
Many of these issues can be mitigated by maintaining a balanced approach, supplementing app usage with professional advice, and staying informed about investment principles and market trends.
Conclusion
Investing apps have revolutionized the way individuals participate in the financial markets. By conducting thorough research, understanding investment options, setting goals, and following a disciplined approach, you can effectively utilize investing apps to grow your wealth and achieve your financial aspirations. Remember to stay informed, remain patient, and adjust your strategy as needed to adapt to changing market conditions.
Surely, there is more than one reason for this hype. Research studies have specified that gold not only straightens up an investment portfolio but also gold bullion builds better risk-adjusted returns for investment portfolios. However, diversification is essential while making financial investments. Investors diversify their investments among multiple asset classes to reduce loss chances and increase potential payoff. Let's cut corners to reveal how investing in gold bullion impacts diversifying your portfolio and managing risk.
Significance Of Gold Investment In Today's World Scenario
Gold is a safe-haven status element of a diversified portfolio because of its significance as a long-term strategic investment. Gold should be valued for being an asset obtained and distributed in a manner consistent with rigorous ESG norms. The potential for gold to protect investors from climate-related threats should not be overlooked. During times of economic instability, investors have been able to recognize much of gold's value over time.
Gold has always maintained its value and bears no credit risk. Gold's popularity stems from various uses, including investment, reserve assets, jewelry, and technology. It provides long-term returns and liquidity with boosting portfolio diversification.
Portfolio Diversification & Gold Bullion Investment
Having a diversified portfolio means spreading your investing capital over several different types of assets or investment portfolios. This strategy is not pursued to maximize returns but to minimize risk and volatility. Although the risk is associated with most investment portfolios, a diversified portfolio can help mitigate those risk factors. It is possible to safeguard and even increase your financial standing by investing in gold.
Stocks or cryptocurrencies are not risk-free assets, and you can't ensure they don't go bust. You can lessen your exposure to this danger by diversifying your investment in your portfolio. However, holding physical gold bullion is a fantastic method to spread your investment risk. For the best-diversified portfolio, you can discover Swiss PAMP gold bars.
Gold Bullion Investment & Risk Diversification
Indeed, inflation is a major threat to investments tied to the economy, such as stocks and IRAs, and gold is a buffer against inflation. Your money would have been safe in gold during the financial crisis, and its value would have increased dramatically. Adding gold to your investment portfolio would have lowered your portfolio's volatility and raised your returns.
If your money is invested exclusively in one asset, you are subject to the maximum risks associated with that investment. As a keen investor, you can prefer to diversify your holdings by purchasing multiple equities or contributing to a mutual fund that works automatically. However, even if the stocks are diversified across industries and geographical areas, there is still an overall market risk.
To effectively diversify risk, investments must be undertaken in completely distinct markets, each of which will react differently to the same external factors. This way, if one element of a portfolio underperforms, the others can hold their own or even expand, offsetting the loss. That's why investing in gold bullion diversified portfolio risks.
In A Nutshell
So, the major attraction of gold bullion and gold stocks is their ability to hedge against inflation and market volatility. As a result, your portfolio benefits from the diversification of risks associated with the multiple assets. By diversifying into gold bullion and stocks, investors can hedge against inflation's eroding effect on their portfolio power. Gold is accepted worldwide and is not tied to a specific country or region, so it is less susceptible to the problems of a specific economy, making gold bullion and gold equities a useful addition to a diversified portfolio.
What are the steps involved in creating an effective financial plan?
In short, an effective financial plan motivates a client to action. For some individuals, that takes pages of projections and numbers to prove the recommended course of action, and for others, it is a simple summary that lists out the recommendations with a brief explanation of the “why.” It is the art of the financial advisor to find the best way to communicate recommendations in a way that resonates with each client. To create a plan that meets this criterion, it takes time to understand how an individual thinks. The more time you take to learn about the unique goals of each individual and the more questions you ask, the better you will be at communicating the important pieces of the financial plan. It is hard to gather all that information in one or two introductory consultations, which is why I believe that you need multiple meetings and touchpoints to create an effective financial plan. My process starts with gathering data and asking the right questions early on so that I know what to ask for and I don’t have to send pages of fact-finding questions for the client to fill out.
After I have the documents I’ve requested from the client, I set up a meeting with the individual or family where I don’t provide any recommendations, but the purpose is to ensure I fully understand their complete financial picture and review the goals for the engagement. You’d be surprised by how much often gets left out of documents and the prospect meetings that are uncovered after starting the financial planning process. After we have ironed out the finer details, I’m setting up additional meetings with the client to review each core area of their financial plan. We review these in person, and they also receive a written report of the analysis and recommendations. After the initial plan has been laid out, there are likely a dozen action items that need to be done to make sure the plan that has been laid out comes to fruition. At this point, the client has an expensive piece of paper.
If I haven’t done my job to motivate the client to act, they have a detailed roadmap of what they can achieve financially. That roadmap still needs to be implemented and the course corrected as life happens. Our firm is in the minority in that we allow clients to stop at this point in the process and take a “do-it-yourself” approach with the recommendations. If a client sees the value that we provide in this initial planning process, then we can often partner with them to implement the recommendations that are within our scope and provide accountability for the action items that we can’t handle directly. At this step of the relationship, as the advisor, I would transition from being the map-maker to the guide and provide the most value by ensuring each step of the plan is implemented and the client is on track to meet their goals.
What are the key legal and technical aspects that must be considered
during this process?
Financial advisors are asked to cover many different disciplines, and our work often crosses over into areas including tax, insurance, and estate planning. Each of those professions and certain types of advice in those fields requires specific licenses that a financial planner may not have. It is important to know what your limitations are. If you aren’t qualified to do something, it’s important to work with quality referral sources in those professions. Financial advisors should have a comprehensive view of the client’s financial outlook. It often makes sense for them to coordinate when multiple professionals need to work with the client.
How does the process differ when the subject of the plan is a family or
an individual?
The process of financial planning itself does not change all that much. Sometimes you find that two individuals in a family may have a list of goals that do not necessarily align. A lot of financial planning has to do with scarce resources. Even with high-net-worth clientele, you’re never working with an unlimited income or asset base, and trade-offs need to be made. If not everyone in a family has the same priorities or values, then there can be some tension.
In the case of multigenerational planning, it is still all too common for only the benefactors to be involved in that process. This also can become a problem when doing multigenerational planning, where the divergence in life stages, goals, and values can vary much more. Despite these potential conflicts, I think going through the process of financial planning and working on identifying the goals and understanding what is realistic can be very helpful for the family dynamic. By bringing in younger generations and creating transparency, it allows the older generation to explain why they are structuring things the way that they are, which can be very helpful when that person passes and avoid conflict between beneficiaries.
What other factors can complicate the creation of a financial plan?
Involvement from the family or individual. The numbers are objective, but a lot of financial planning is subjective and requires feedback from the client. I can create what I think is an amazing financial plan for a client, but they are the ones that must live it, and the plan needs to reflect their preferences. I will do most of the heavy lifting, but a good financial plan requires collaboration and involvement from the client to create a quality finished product.
How has your approach to financial planning developed during your years
in practice?
I first entered the industry right after college. I was focused on getting my licensing, CFP® marks and trying to learn all the theory and technical aspects of financial planning and investments. I wanted to know what my colleagues who had more experience than me did and how to recommend and implement complex strategies for clients. I also thought that managing investments was primarily what a financial advisor did and that to provide value, I had to outperform markets. In my earlier years, this led to lengthy spreadsheets and more complexity around investments, and while being technically sound, I feel that they may not have resonated with all my clientele.
As I have matured in my practice, I still stay on top of all the changes to financial planning theory and the various investments available, but my focus is more on being a good communicator and coach. While investments play an important role in what I do ongoing for clients, there is a lot in financial markets that nobody can control, and I’ve realized that as an advisor, I should focus my expertise on the factors of financial planning that we can change and that will create a larger impact for my client. As I mentioned earlier, I think the most valuable piece of a financial plan is that it is actionable. If I provide the most complex recommendation with tens of thousands of dollars in tax savings or a better investment structure, it means nothing if I can’t communicate it in a way that not only informs my client but motivates them to act on it.
BIO
Chris Siraganian - https://firstfinancial.is/chris-siraganian/
Chris Siraganian is a Financial Advisor at First Financial Consulting. Chris works with individuals and families to help them make sense of their financial landscape and assist them in pursuing their own unique financial goals. He would tell you that the relationships he cultivates with his clients are the most important part of what he does, and he believes it is an integral part of giving tailored financial advice.
Chris Siraganian has been with First Financial Consulting since 2012 and sits on the firm’s Investment Committee. He obtained his Bachelor of Science in Business Economics from Azusa Pacific University and then completed his CERTIFIED FINANCIAL PLANNER™ education through the UCLA Extension. He is also an active member of the San Gabriel Valley Financial Planning Association and is always looking to better the financial planning profession.
About First Financial Consulting - https://firstfinancial.is/
At First Financial Consulting, we believe in fully empowering people to achieve their financial goals by providing totally objective financial advice. Accordingly, we work on a “fee-only” basis to remain free from any potential conflict of interest. Simply put, our success is measured by the success of our clients in achieving their financial goals.
Understanding KiwiSaver Contribution Rates
KiwiSaver members can choose from three different contribution rates: 3%, 4%, 6%, 8%, or 10% of their gross salary or wages. Additionally, if you are an employee, your employer is required to contribute a minimum of 3% to your KiwiSaver. Self-employed individuals and non-employees can also contribute to KiwiSaver through regular payments or lump-sum contributions.
The higher your contribution rate, the more you save for your retirement, and the greater the potential for your KiwiSaver account to grow over time. Contributing at a higher rate can significantly increase your retirement savings due to the power of compounding returns. It’s essential to find a balance between saving for your retirement and fulfilling everyday financial needs.
If you’d rather have professionals manage your KS plan, Milford offers an award-winning strategy, managed by a team of globally experienced investment specialists. You can choose out of a variety of funds, each presenting a different risk management strategy, from conservative to aggressive options.
Finding the right savings balance
To find the right balance between retirement savings and current needs, consider your short-term and long-term goals. Create a budget to track your income and expenses, allowing you to determine how much you can comfortably contribute to your KiwiSaver account without negatively impacting your living expenses.
Calculate how long you have left until retirement. The longer the timespan, the more time your investment has to grow, and the more you can potentially benefit from a higher contribution rate. The earlier you start contributing, the more time your investments have to grow.
Take advantage of the annual government contribution
For every $1 you’ve put into your account, the Government will provide an additional 50c, up to $521.43 annually. This is called the annual government contribution, of which you’ll receive the full amount after contributing at least $1,042.86 each year.
This money adds up over time, so try to keep your yearly contributions above $1,042.86. Considering you start your contributions at 18 and continue to save up until 65, you can earn over $20,000 in government contributions, which is essentially “free money”.
Overall, balancing your KiwiSaver contribution rate with your current financial needs is essential for achieving a comfortable retirement. Keep in mind that you don’t have to contribute the full $1,042.86 each year to benefit from the annual government contribution - even a contribution of $100 will still earn you an additional $50, so every little bit counts.
