How To Power Up Your Finances In 2024

This is the year people have been waiting for a while and now it is here...

2024 has been a year of economic prosperity, with big profits, dividends, bonuses and pay rises so far.

All the hard work, grit and patience during and after Covid has somewhat paid off in the first half of the year. 

Additionaly, Gold, Property, Stocks, and Cryptocurrency, all are on the up. The markets have been friendly and the overall atmosphere seems to be positive.

Now is the best time to start ambitious planning of your future and your finances. 

Time to Power Up

Use this optimism to power up your finances.

Build ambitious financial plans, upgrade your goals and try to reach the next level.

Plan to build more wealth and to give your loved ones better platforms to launch their future.

Aim to create additional streams of passive income plan and to upgrade your retirement lifestyle with your efforts today and the next few years. 

Don’t let this optimism fade away into nothing.

 

Rework on your budget

Rework on your budget to optimise your income expenses to create an investable surplus consistently, This is your key ingredient for building wealth.

If you do not have budget already, use this forward cashflow planner to get 12 months overview of your finances. 

It is also easy to drift in to the optimism to enhance lifestyle and splurge on things that you would not do other wise. I am not saying you must not splurge,  If not in good times, then when do you enjoy the niceties of life. 

I am just saying that it is also important to continue building wealth through disciplined savings and investing, and if possible enhance the scope by as much as you can. 

Split your earnings in the ratio of 50:20:30.

50% for needs and wants, 20% for luxuries and 30% for savings. 

Why 30% savings?

Residents in the UAE tend to have relaitvely higher disposable incomes, since there is no personal income tax. Also, most of us are expats, who have come here with a primary objective of saving more money and building wealth, faster. 

Hence the 30% savings recommendation. If you are not here yet, start now and keep working towards the 30% savings goal.

Continue to build wealth 

The three key factors for building wealth are;

1. Savings and investing

2. Time

3. Growth in value.

The first and second aspects are largely in your control, while the third is not in anyones control and usually is sporadic.

Start investing early, continue to invest on a regular basis and stay invested for as long as possible. Take charge of aspects in your control and leverage on the growth when it comes. 

Choose to invest wisely

It is also easy to be carried away by the optimism to invest in assets that are already inflated and their values could go down sharply, when the tide changes. Such corrections typically take months to years to recover, which can be a mental put off towards investing and an impediment your wealth accumulation goals. 

Now is the time to take extra caution and invest in quality assets, that are likely to hold its value or bounce back quickly after a correction. Chose your asset allocation wisely. 

ARK ETF & Cryptocurrency are just a couple of examples of assets that were highly inflated during the 2021 boom and people who invested at the peak are still in the red. 

History teaches us many lessons and we should apply them when times repeat.

Do loads of research and look for quality assets that are low or moderate in valuation for investing. 

Consult a financial advisor or an investment advisor to assess your risk and align your investment strategies accordingly.

Trim the Risk

This is also a year to set greed aside, book profits and rebalance your portfolios. It is easy to be carried away by the optimism and wait for the markets to go further up, but you never know, bears could be lurking around the corner, waiting to pounce at any time.

Once the markets have gone down, you may lose all or some of the growth achieved until now, and it could take a few more months or even years to see growth again.

Protect the downside 

When a wicket or two falls on cricket, the batsmen on the crease tend to shed the extravagant shots and focus to putting an innings together by adding ones and twos, with occasional boundaries here and there..

Similarly, during times of adversity we tend to cut corners on insurance, investments and other crucial protection aspects that do not provide instant gratification or relief.

Now is the time to revisit your protection needs and financial goals, to ensure that your financial pyramid's foundation is strong and robust. 

Also, now is a great time to build and or augment your emergency savings bucket. 

Power Up Your Finances

2024 presents a unique opportunity to capitalize on a positive economic environment 

Power Up, by taking a proactive and ambitious approach to financial planning and investments

Embrace the opportunities that this year offers, stay disciplined, and make strategic decisions to secure a brighter financial future for yourself and your loved ones.

Jumpstart

I can help you create an ambitious and yet a practical financial plan, with each goal and strategy aligned to your unique financial situation and preferences. Click here to Power Up your Finances.