Power financial management achievement motivation

Don't let the rising cost of fuel and expenses steal your dream of financial success!

A SIMPLE SYSTEM FOR MEASURABLE AND SIGNIFICANT FINANCIAL MANAGEMENT SUCCESS

I want to take the time to share some positive information on one of the most important subjects that I can deal with when it comes to successful living, especially in these financially volatile times, and that is the subject of successful financial management. I have known people who have made a substantial amount of money in their professional life, but because they did not have a financial plan, they spent more than they made, thought that the income would last forever (and of course, often it doesn't), and they ended up owing thousands of dollars in debt and taxes to the government. I would like to help people to avoid those types of problems if at all possible, it is not only extremely simple, but extremely possible. After all, it's not how much you make that counts, but how much you keep, and how much you give to worthwhile causes!

I'm convinced that most people have all the ingredients within them, to:

1.) pay off their bills,

2.) get out of debt,

3.) make wise investments for their financial future.

***THAT'S WHY THIS COURSE IS PRICELESS!***
My task is to draw it out of you by providing a motivating challenge to you, along with a simple system for your success, that literally anyone can implement into their life in this crucial area. Most people think that the task is to complicated, and the subject to vast, making it impossible for the average person, without the training of a financial planner to succeed in their personal finances. Although we certainly advocate that a person takes the time to study the subject, and consult with professionals, we believe that a person must take ownership of their own financial success or failure, because no one is going to care about it as much as you! The bottom line is that you must take responsibility for you and yours, and with a simple system you can literally accomplish the task in about 120 seconds a day! That's right, I'm saying that you can pay off your bills, get out of debt, and make wise investments with only an average daily investment of time, of approximately, two minutes a day! I'm going to show you how in this report!

Most people think that they need to earn more money, and we are totally for that, but that is not the main problem that most people face. Most financial problems are created by poor money management, rather than a lack of money. If you do not have a system to manage your money, and if you do not consistently work that system, you will always find that even as you earn more money, your expenses will always rise to meet your income, and usually surpass it! I am going to share a simple money management system that anyone can use for financial success!

Everyone faces financial difficulties at different times in their life. This is a financial age that we live in, and it's easy to fail in this area of life, but the good news is that even your past failure can give you the wisdom to succeed, and certainly it is a great motivator to succeed next time! You must always keep in mind that your financial past does not have to equal your financial future! I have found that wisdom usually comes from experience, and experience usually comes from problems, obstacles and failure. The fact is that it is easy to beat yourself up in this area, which usually just makes matters worse but once you have a clear cut strategy, your attitude will improve, and you will feel better about things immediately! Some people become arrogant with their financial success, but its best to take care, and not be critical as things can change in a "New York Minute", as many have discovered in the past.

With the advent and invention of credit, it's very easy to spend more than you make, and most families today, live paycheck to paycheck. Most are living then, from crises to crises, and in survival mode, rather than facing their financial life courageously, paying themselves first, and working an investment plan! Most people find the money to spend on what they really want, but saving money is not a priority. Somewhere, sometime, somehow you must make saving money a priority, if you are going to have financial freedom and independence in the future, and I'll help you do that!

Most people lack a simple system for successful financial management including a simple savings vehicle. Once that system is learned, implemented, and acted upon, major and positive progress begins to take place!

FIRST: HOW BAD IS THE PROBLEM IN AMERICA?

***98% of Americans over age 65 are unable to support themselves without the help of the government or family members.

***Fewer men are worth $100 at age 65 than at age 18.

***According to the social security administration, of people over age 65: 45% are dependent on relatives, 30% live on charity, 23% are still working, and only 2% are totally self sustaining.

***85% of the over 50 crowd can't come up with $250 on their own.

***Most senior citizens live out their years feeling like they are a burden to society and their families.

*** The number one cause of stress in a marriage is caused by financial pressure. 85% of all marriage problems can be traced to financials difficulties.

***Today's young people face constant financial pressure, because of the emphasis on things in our society. When you're starting out, you cannot have things and money too, because if you want things, you must exchange money for things. You can't have both. How many young couples want in their first year of marriage, everything that it took their parents to accumulate over a thirty year period and more.
But most of these problems could be solved with a simple financial plan, worked consistently over time by both parties!

***95% of all self proclaimed financial failures say they lacked a plan for their finances.

Most people are just too busy in day to day living, just trying to survive, to take the few minutes a day necessary to insure their financial success! We're really without excuse, as there are so many great books, audios, and videos on the subject, that we could take advantage of, but we lack the motivation because we are so tired and worn out from the struggle, and stress of our fast paced lives. It's one thing to have the answers at our finger tips; it is another thing to take the action necessary to solve the problem. In this report you will have the system, a complete strategy for financial success, but you must supply the effort, and I encourage you to not procrastinate, but immediately apply this system and strategy to your life!

The first step in the process of financial success is to find out where you are now. If you want to fly to Tahiti, you must know the city you are going to be leaving from. So in your destination to financial freedom, you must ascertain where you are leaving from, or what is your financial situation right now. You must take the time to do a little personal financial analysis. Take out a sheet of paper , and list all your assets. It doesn't take a lot of effort, but it is essential if you are going to design a roadmap to follow to fulfill your financial dreams. Write down every thing you can think of, such as, do you own a home, a car, property, mutual funds, stocks, bonds, does someone owe you? List all jewelry, and collections, anything and everything of value that you can think of. The idea is to get a realistic financial picture of where you are currently in your financial journey. You are taking inventory of every asset you have that has a financial dimension to it. As you make your list, put a financial worth next to each item of a dollar amount. When you are all finished, total up the list, and that will be approximately what you are worth in assets at this particular time.

Now take another sheet of paper and make a list of all your liabilities. In other words, make a list of everything you owe. Most people do not enjoy this part because it is so revealing. Most people also do not know what they have in assets, and most people are not really aware of what they owe in liabilities. This is important in the process of charting your new course to financial freedom. Write on your liability list, every debt you can think of. What you owe on your house, your cars, you visa and charge accounts, any property, even list relatives and friends that you might owe. Be as thorough as possible so that you can get as real a financial picture as possible.

You then take the amount of your assets, and subtract the amount of your liabilities, and you have a true picture of your net worth! This is necessary to know, if you are going to increase your net worth. Now that you know where you are, you can set goals, and develop strategies, to take you from where you currently are, to where you really want to be.

Many people will find themselves in the negative balance. It was Donald Trump, who had just gone through a financial reversal, and several banks had just put him on a cash control system, was waking down the street and saw a homeless person rustling through the trash, when he thought, "well at least I'm not as bad off as that guy," and then he realized, "wait a minute, that guy is at '0', he doesn't owe anything, when I owe billions!" So if you take stock, and you hit the negative, don't feel too bad. If your not feeling to good after you have done this, let us share with you five things that cause financial failure, so that you can avoid them in the future:

1.) Failing to purpose to become financially wealthy. Remember, good things happen on purpose, and bad things happen by accident. You must make it a priority if you are going to make financial independence a reality in your life.

2.) Failing to control the resources at our disposal. Everyone has something that they can invest to make more money and secure their financial future. Winning the lottery, or striking it rich, is probably not going to happen, but if you take the resources that you already have, and put them to work for you, and let time compound your investment because you have a plan you can develop substantial wealth.

3.) Failing to set financial goals, and to develop a financial plan with strategies for financial success. Most people spend more time planning their one week vacation than they do their financial future! That's a tragedy! That's why people fail, they have no specific financial goals, they have no serious financial plan, and consequently, they cannot take effective action! It really doesn't take a lot of action, just action for a few moments consistently, every day!

4.) Failing to let the money you have, and the money you will have, to create wealth, for you. If you just get started, your efforts will compound every day because of the magic of compound interest, which works for you in investments over time, and against you in debts. Daily activity and action compounds, just like compound interest!

An illustration of the magic of compound interest is, that if you were to open a mutual fund account for a five year old child, and deposit $500 in that account, and never adding to that account again, when that child becomes 65 years of age they could have as much as $500,000 in that account because of compound interest.

Whatever resources you have right now, you need to invest and let this wonderful asset builder, work for you. If you invest properly and wisely, you're letting your money make money for you, even while your asleep!

5.) Failing to find out what you love to do, and using that to create opportunities to create wealth. So many people are trapped in life, just earning a living, instead of creating a life of abundance. People are afraid to let go of the familiar, and get out of the rut, even if they hate doing it every day. People continue to work in controlling, manipulating, miserable environments, with unhappy people, with bad attitudes, instead of using their special gifts and talents to create something of value that brings them great pleasure to work at! Find out what you love to do that charges your battery, empowers you, and then make that your life work, and find a way to make that create wealth for you!

Now that we have discussed how to fail, and have revealed the problems, let's continue on and discuss the positive solutions. The obvious solution is to make more than you spend, and invest the difference. Is that ever profound? The real trick is, how do you do that? That's exactly what I intend to show you! Basically there are three things that you must do:

*First, control your out-go;

**Secondly, increase your income;

***Thirdly, pay yourself first!

All it takes is an easy to understand plan, that is also easy to initiate, and then a lot of desire on your part, enough desire that is, to move you to action! Emotion produces motion. So when you are emotionally sick and tired of being broke, you can create the energy and motion to produce stellar results if you have a strategy to focus on and implement in your life! This is the strategy you have been missing!

Once you have initiated the plan, you will find immediate comfort because of the hope created by knowing that you are finally on a plan that will get your financial life under control. As you then begin to pay yourself first, you will feel much better, as our attitude is usually in direct relation to our bank account balance. Even if we still have unpaid bills. That's why; again, it is so important to pay yourself first!

My financial success strategy is going to be a four step strategy that is so simple that anyone can do it! A word of warning though, many great things are missed by many people, because we think complicated is better! Yet I have found the greatest things of life are found in simplicity, and some will miss the power of this system, because their frame of reference will not allow them to accept simple solutions! I challenge you to try, and test these concepts thoroughly, and see them pay dividends in you finances! I have seen many people apply these principles to their life, and in many cases, it has not only allowed them to, pay their bills, get out of debt, become financially free, and even start their own business. The sky is the limit, but the results are totally up to you. So lets get started with the incredibly effective four step strategy for successful financial management.

MY ASSETS
(Write down everything you own, your house, car, cash, savings, stocks, bonds, property, jewelry, collections personal loans owed to you, anything and everything of value that you can think of.)
____Item______________________________Est.Value
__________________________________________________ Total_________
MY LIABILITIES
(Write down EVERYTHING THAT YOU OWE. What You owe on your house, your cars, your credit card accts., bank loans, student loans, properties, even list relatives and friends that you owe money to. Be as thorough as possible so that you get a realistic financial picture.)
____Item_____________________________Amt. Owed___ Total_________
Part 2
POWER MOTIVATION FOR SUCCESSFUL FINANCIAL MANAGEMENT!
(The Strategy For Success) instituteofchampions.com

The management of your finances can be broken down into four major and critical steps.

1.) You must reconstruct your expenditures daily. The average person has no idea where their money is going, because it slips away daily, in little increments. Most people come to the end of the month, and find out there is more month, than money. How often I have counseled people who make good money, yet at the end of each month their bills are unpaid, and they have no idea where all that money went. You can never control your out-go until you know exactly where it is going. This is paramount to taking control of your finances, and if attended to for just a few seconds a day, you will know exactly what's happening. Let me ask you, what exactly did you spend your money on yesterday, the day before, last week, or last month? I mean every penny! This is so easy to reconstruct if you do it daily, and impossible to do if you don't. There is no place for arrogance here. I have known many people in my seminars that confidently declared that they knew exactly where their money was going, and upon closer questioning they came to the conclusion, that they really had no idea! I'm going to share an easy way to accomplish this simple task.

2.) You must record your income. Once again, most people have no real idea as to how much money they really have coming in to work with. Many people think they make more money than they do, because they have never studied all the deductions taken from their pay-check. Other people have no idea that they have extra money coming in such as a refund from an insurance company, or interest dividends, or some other source. If you will begin to focus on this daily, and start to record it daily, your mind will even begin automatically search for new ways to increase your income, and that's powerful! If you cannot control what you already have coming in, at least by knowing exactly how much that really is, how will you even take advantage of an increase when that happens? You must prepare for increasing your income, by recording it daily as it comes in, start now!

3.)You must review your obligations daily! Most people make the fatal financial mistake of only looking at their bills on the first or the fifteenth, depending on their payday. If you remember, we have previously shared the principle, that whatever you look at on a daily basis is what you will do. If you will take the time to look at your obligations daily, keeping them in the forefront of your mind, you will find that your brain will discover all kinds of creative ways of retiring your debt. This concept is so powerful, you will not believe the mileage you will get out of this when it comes to getting debt free, and I am going to show you how to do it!

4.) You must reflect on your investments every day. Again, whatever you focus on, you become. Its not enough to go to an inspiring investment seminar, or to read a good book on the subject, daily focus and daily action, are critical for success in any endeavor, and much more so in this area that is so important to you! If you will exercise the little, small, discipline of focusing, every day on your investments, then again your mind will start looking for good investment opportunities, and your mind will also find, and free up funds to build you investment portfolio into a fantastic future for you. Again, I WILL SHOW YOU HOW!

Financial success is really the result of simple but good financial habits that are initiated over a period of time, and repeated over and over. Wealthy people have simple habits that are successful, that they have learned and that they just keep doing again and again. Success leaves clues, and once discovered they will work repeatedly if you will just simply repeat them.

Let's discuss thoroughly, point number one in my four point strategy for financial success, that is; Reconstructing daily expenses. I encourage you to purchase a three ring binder to set up your simple management plan. The first thing to do is to take some regular notebook paper, (or make copies of the form I have provided in this report) and at the end of each day, you simply write the date, and then write out everything that you spent money on that day. If you have a spouse, be sure to include them in this exercise. It will only take a few moments. Just ask yourself, "what did we spend our money on today?" Write down everything that you can remember, including every cup of coffee, every snack, lunch, dinner, drinks, newspapers, gasoline, groceries, anything and everything that you can think of. If you will do this for a few minutes at the end of every day, before you go to sleep, you will get a new appreciation for where your money is slipping away to. At the end of the month, you can then categorize your expenses, and easily see where you can cut back so that you will have more money to pay your bills and invest.

This simple process will make you accountable to your self and to your spouse; you will find that you will stop wasting money on non-essentials because you don't want to have to add it to your list at the end of the day. The principle works on the same idea as "Weight Watchers", where they have you write down every thing that you eat every day. What an eye opener that is! I guarantee, this little discipline will work wonders in your life, if you only work it. Your mind will automatically begin to control your spending, and you will feel great because you know you are making process, all because you are simply aware of what you are spending on a daily basis. Daily is the key! If you want it to work, it will only work if you take the little discipline of doing it daily! At the end of each month, (because you will want to continue this effective process), you should have an entry for every expense for every single day. You don't have to get fancy, but you do have to be consistent and thorough.

The second crucial part of my strategy is to, Record your income. If you will go to any office store, you can pick up some simple ledger sheets that will fit in your notebook, behind the notepaper. (Or use the form I have provided) Start by placing the month at the top or the sheet, and title the sheet, "Monthly Income". Each day, when you take your 120 seconds to get your life under financial control, ask yourself the question, "did we have any money come in today?" What about money from a garage sale, or someone who repays you a loan, or a gift from someone, or money from an investment, or money back from a refund. Any number of items would apply. If the answer is yes, then enter it on the ledger sheet. Many days there will be nothing, especially if you get paid twice a month, but get into the habit of asking the question, daily, anyway, as your mind will start looking for ways to earn money to put on the list, and you will be surprised at how really creative you can be in this area. It really does work! At the end of the month total up your income so that you can really know how much you had to work with, and watch that amount begin to grow every month!

Now lets discuss the third crucial part of this four part strategy, that of reviewing all your financial obligations daily. This is where it can get a little negative in the beginning, but soon this list will be a great encouragement to you. Take another sheet of the accounting ledger paper, and entitle it, "Monthly Obligations", and also include the month. Now list any and every bill that you owe! Start with the most important first which would probably be you, (because your going to start paying yourself first, and we suggest that 5-10% is a good place to start). Then list your mortgage or rent, and so on down the line. Dig out all your bills, and jog your memory, and list everything you owe, no matter how painful it seems.

We have seen people with fifty to sixty entries on their list in the beginning, and after a few months the list will shrink and shrink, until finally there will only be about fifteen entries each month that are essentials that you will always have.

A word of warning...when you have your list completed do not go on a drinking binge, or contemplate suicide. Its not worth it. We said this is the negative part, and one of the big reasons that people never go to financial seminars, or ever follow through, is that it is just to painful to face the truth and see how bad things really are. So we would rather hide our head in the sand, like everything else is not exposed! This though is a crucial step as everything revolves around this. Now you are on the road to recovery.

Once you have your list completed, take the time to not only prioritize your list, but also to identify bills that you are paying the highest interest on, and bills that will be the easiest to pay and remove permanently from your list so that next month you can apply that money to other bills. Each evening, look over your list and ask, "is there anything that I can pay today?" Your mind will automatically begin to look for ways to clear this list, and shorten it month by month. As you are tempted to make purchases that you cannot afford yet, your mind will remind you that you would rather pay your debt list down. Its almost magical how it works, but the key is again "daily". As you pay each bill, write the date paid, and make a big deal of it, maybe crossing it off with a red pencil, anything so that you can see the progress you are making. At the start of a new month, transfer the regular payments to your new list, as well as those that you have not been able to take action on yet, and watch that list shrink month after month. If you will follow this plan daily, it will shrink, and you will have a great sense of accomplishment every month instead of being overwhelmed and discouraged because your finances are out of control.

The fourth and final step in this strategy is to, reflect on your investments every day! As I stated earlier, make it a point to pay yourself first. Your creditors will wait, because they have to, the important thing is you, and you must start to pay yourself first, methodically and consistently, if you are going to secure your financial future. Take another accounting ledger sheet, and entitle it, "Investments", at the top. Begin to list how much money you are putting aside each month, and ask yourself the question everyday, "can I increase my investments today?" Savings accounts are the worst financial vehicle you can have your money in, as they pay such low rates that inflation will slowly eat up your money but take action and do something! Mutual funds are generally the best and most consistent investment if you study them. Look for funds that are "no-load", which means that they don't take a commission off the top the minute you invest, thus lowering your investment amount, and causing your fund to have to grow substantially just to break even. There are good "no load" funds that you can invest in for a minimum of $100, and you can even start an automatic deduction, monthly out of your checking account, so that you will be consistent in investing. Be sure to look at a funds growth over the last fifteen years, and find out how many years it will take to double your investment in the current market. The important thing is to pay yourself first, start investing, and if you will focus on it everyday, again your mind will begin to study investing, and cause you to focus on good opportunities that cross your path. It's an automatic when you use a simple system like this that is so powerful. As you work your system you will see what I mean, and you will become a proponent of it, to all you meet. It will totally revolutionize your financial life, if you will just discipline yourself, a little every day, for about two huge minutes, out of twenty-four hours. Do you think it's worth it?

Remember; if you always do what you've always done. You'll always get what you've always got. So, if you don't like what you're getting, you MUST CHANGE WHAT YOU ARE DOING!

Financial needs analysis

Financial Needs Anaysis (FNA) is defined as a process to identify individual financial needs in order to strategise an investment plan that meet such needs and financial goals. Before I go into details about FNA process, let me explain the three broad categories of financial needs;
(i) Accumulation Needs It is defined as a future financial need that one desire to set aside. The motivation to accumulate a sum of money in future include children education, starting a business, property investment, buying a car, retire early or giving to charity.
(ii) Retirement Needs It is defined as financial need that provide fund to support our life after our retirement. When we retire, our pension or social security benefits begin but our earned income ceases. Our working expenses reduce but our leisure and medical expenses increase.
(iii) Protection Needs It is defined as financial obligations that we need to fulfil upon death, disablement, contracting critical illness, loss of or damage to property and/or when a personal liability arises.
Having a general idea about the three main categories of financial needs, let me go through the process of Financial Needs Analysis:
(1) Fact finding --> (2) Identify and quantify financial needs --> (3) Identify investment products that meet financial goals --> (4) Periodical review of financial needs
1. Fact Finding
Gather personal details, employment details, number of dependents, financial information, existing insurance policies, retirement needs, saving goals, objective and investment preference. Personal details such as age, gender, martial status and smoking habits will offer us a preliminary assessment of the types of financial products that will likely suitable for us. Employment status enables us to determine if income protection is needed for high risk job, and the ability to commit long to medium term investment product. The number of dependents will determine the amount of additional financial support. The more dependent we have, the greater the number of years we have to support them, which means we need more life insurance and income protection. Financial information such as monthly income will help to determine the continuing income needed in the event of death, disability or retirement.
Expenditures information will help to determine the level of income needed for the family to survive in the event of premature death of the breadwinners, and to estimate the funds available for investment. Assets and liabilities information helps to determine net worth, which enable us to decide on the amount of funds for investment or to adjust our lifestyles to reduce liabilities. Existing insurance policy will serve as a starting point for any further insurance products. The objectives and investment preferences will help to determine our attitude towards investment risk, which classified into Risk Averter, Cautious, Balanced and Risk Seeker. Retirement needs information enables us to determine the monthly amount in today's dollar that we and our dependents need to live on retirement. Generally, most singles need about 50% to 60% of their pre-retirement income to maintain same living standard after retirement. The percentage increase to 60% to 70% for married couples with one retiree. Saving goals information helps to determine if the funds earmarked for various financial goals are adequate.
2. Identifying and Quantifying Financial Needs
After we have gathered all the data through facts finding, the next steps of FNA process is to analyse the data to identify and quantify the financial needs. We should pick up weaknesses that can negatively affect the financial objectives. For examples; amount of debts, investment portfolio, existing insurance products, living within means, investment time horizon, liquidity need, children education and risk profiles. Determine which objectives should be given higher priority. Three factors should be considered when analysing objectives:
Establish if the objective is short-term or long-term. Short-term objective is more appropriate for retired person who may wish to increase income produced from investment capital. Long-term objective is more suitable for someone who want sufficient fund to send his new-born child to university in future. However, objectives can be both long and short term. Establish if the objective is for the benefit of us or for others, such as dependants. For example, the objective may be passing our estate to our grandchildren in the event of death. Alternatively, the objective may be to retire early. Prioritise the objectives. For example, we may want to invest a second property but to achieve this objective; it may detriment a reasonable income in retirement. It is important to tackle each financial need and uncover those needs that need immediate attention. Once all the financial needs are identified and prioritised, each need must be quantified. The ways to quantify retirement, protection and accumulation needs are different. There are two methods to quantifying retirement needs, namely the replacement ratio method and expense method. As for protection needs, the method include determine the sum of total liabilities and immediate expenses required at the time of death and the amount needed for dependants as long as needed. Multiple approach and needs approach are two common approach used to quantify the amount needed for dependants. For accumulation needs, the approach is to find the future value of the target amount taking into consideration of inflation. After we have quantified the data, proceed to next step to identify investment products that meet financial objectives.
3. Identify Investment Products that meet Financial Objectives
Points to consider includes investment objectives, product suitability, affordability, taxation, tax relief, rick tolerance, pension schemes, prioritisation and effect of inflation and time value of money. Investment Instrument that meets accumulation and retirement needs includes Money Market Securities, Fixed Income Securities, Equity Investment, Derivative Instruments, Property, Unit Trusts, Whole Life Insurance, Endowment, Investment-Linked Products and Annuities. Investment products that meet protection needs include Term Insurance, Whole Life Insurance, Endowment Insurance, Investment-linked Life Insurance, Riders, Critical illness Insurance, Long Term Care Insurance, Medical Expense Insurance and Managed Healthcare Insurance and Disability Income Insurance. General Insurance products that meet protection needs include Fire Insurance, Household/House owner Insurance, Personal Accident Insurance and Personal Liability Insurance.
4. Periodical Review of Financial Needs
The process of identifying financial needs does not stop with implementation. Our financial needs may change over time. It affects our initial investment plan, as they may no longer be adequate. For example, a steep fall in price of equities would signal that a review of our investment portfolio and saving is required if we invested substantially in equities. Regular review of financial needs ensure we stay on course to our financial goals.

Free financial planning - one must be before it can receive

The general concepts of financial planning are heavily rooted in high moral and ethical standards. Rather than randomly investing and making general assumptions regarding one ' s finances, the true purpose of a financial plan is to provide a detailed and unbiased understanding of one ' s financial picture in order for them to achieve their specific goals. Establishing a foundation of financial planning has helped many clients and advisors alike bring logic and reason as to why and how to invest, helping to supplant the negative emotions of investing with a sense of financial confidence and security. With this said, one could suffice that a financial plan would be the basis for nearly all financial decisions. Likewise, it could be utilized by nearly every financial professional in helping determine proper suitability for their clients. Needless to say, all people would benefit from an objective financial analysis by a qualified professional, and these professionals would then benefit from implementing their unbiased advice. Why then should a client have to pay for financial planning services in the first place? However, to put it more directly, why should a client have to pay a fee in an attempt to ensure that their interests are being best places? The answer is rather straight forward.Financial planning should be free.

The first question that must come to mind is, "Well then how does the financial planner make a living?". Believe me when I tell you, they make a living, and a handsome one at that. It is not the financial planning fee from which they reap their rewards vast. When a client countries for a "financial plan" they are only paying for advice. The advisor or planner is still going to receive a commission from implementing the plan, and that is where the majority of their income is produced. So be careful of a professional who designates as simply, "fee-based" themselves.This means that they are either charging for the financial plan while also collecting a commission, or even worst, simply charging a management fee for allocating your portfolio. Unfortunately, not many financial professionals let this be readily known, and make it appear as if they are being compensated only for their expertise in the form of the financial planning fee.

So with a check already in hand, how sure can the client be que la advice adhésion is going to be truly objective? With a monetary commitment from the client, the professional is then in a position of power and is required to only fulfill an obligation, not provide true value. By paying for financial planning services the advisor is stating that the customer ' s best interest cannot be obtained without proper compensation. Thus, any value above and beyond what the customer has paid for is not expected on the part of the advisor. So, not only is the client paying for your best interest to be puts aim that best interest may not be fully obtained.Remember, a financial planner is a business owner. Their time is equal to money, so with a check already in hand, the client is giving them permission to do "just enough". They are only compelled to fulfill a contract, not add value.

Free financial planning builds a foundation of honesty. By exemplifying their services and not simply fulfilling an obligation, the financial professional must earn the customer ' s trust, raising the likelihood of the highly client receiving objective recommendations. Granted, many financial professionals believe themselves to be of the highest integrity, but the only way for the consumer to be sure of this is for the advisor to put their money where their mouth is. You would be surprised how many financial advisors who pride themselves on their virtues would magically change their tune when their recommandations (aka: their time and effort) must result in implementation to ensure their income.

The two main objections that a financial planner may have against free financial planning are that their time and their credibility may be compromised. To begin, it is true that a business owner ' s time is their most valuable asset. In fact, their time may be more valuable than money itself. The argument follows that if they are spending their time putting together recommendations for customers who may not implement them, it can severely cut into their profitability. This ideal is flawed on many levels. First and foremost, if an advisors is lacking the confidence to offer free services in fear that their work may not be accepted, it demonstrates that the bottom line and not the customer well being is paramount above all else. Thus they lack the confidence to properly represent the client ' s needs and fulfill their objective.However, the most obvious reason for an advisor or planner to offer financial planning as a free service is monetary. In their offering financial planning services for free, a financial planner is establishing a relationship of trust and honesty with their client. This strong foundation will inevitably result in a multitude of referrals for the advisor, which are the life blood of their business and the ultimate maximization of their time and effort. The small percentage of income that a financial planning provides fee for the advisor blades in comparison to the financial gains experienced by a steady stream of high-quality referrals. Indeed, when a financial professional stops concentrating their efforts on instant gratification and begins to operate an honest and trustworthy business, the long-term benefits will assuredly follow.

Here, the idea that free financial downgrades the financial planning professional ' s credibility is defeated.An advisor may believe that they are devaluing themselves in the eyes of the prospect by offering their services for free. However, true credibility is established by providing exemplary service, not by the fee that is charged. The truth of the matter is that by offering their financial planning services for free, the financial professional is maximizing their time and legitimizing their credibility. If they do not succeed using this method, then they are not going above and beyond for their client, and do not deserve their business nor their referrals. It is a win - win for all parties. The client receives the objective advice they deserve, and the advisor maximizes his time and effort.

If I call my doctor with what I believe to be heart burn, I do not want to pay for cardiovascular surgery ahead of time. I want to be properly evaluated, given a professional diagnosis, and then billed accordingly. In something as vital as an individual ' s personal finance, business should be completed in a similar fashion.It is mandatory that year bought individual receive the most objective possible advice in regards to their financial future.By giving and receiving later, financial the first professional is more likely to provide that objective advice and will go above and beyond to fulfill the customer ' s needs.Consequently, by providing the client with the services they deserve, the advisor will be rewarded with a reputable and highly profitable business.To be sour, the public should let the experts have the opportunity to perform des droits et leur.However, as with the majority of other professions, they should at least earn the individual ' s trust through hard work and exemplary service.

Regulation of financial markets in the region of Africa South - current status and developments

The success of the financial sector is a key component for economic development

The financial markets sector is one important area of public concern in Africa. The need for adequate regulation and supervision of Financial Markets as an important mechanism for the promotion of economic development in African countries cannot be overemphasized. Financial markets regulation remains a very sensitive and complex activity when it comes to governmental policy development, with relation to defining strategic options pertaining to financial regulation. This article reviews the current status of financial farkets, the legal and regulatory frameworks in the Southern African region, with a special focus on selected countries.

The topic under investigation relates to the regulation of financial markets by governments within the Southern African countries both at national and international levels. It attempts to grasp its rationale, objectives, approaches and the practical ways of defining a regulatory framework for a modern African financial market and system. At a time many experts are calling for liberalization of financial services in Africa, it is important to analyze what are the rationale, advantages and implications of financial markets regulation for Southern African countries under the light of new international instruments and standards, such as the Basle II Framework and the WTO Agreement on Financial Services of 1994, whose operational modalities are is still under negotiations on various key aspects.

This paper attempts to examine the institutional and regulatory framework for the financial markets operations in order to understand the underlying principles of financial markets regulation development; to develop a concise outline of financial markets regulation framework within the South African countries; and provide as much as possible a clear understanding of policy development, key issues and challenges relating to the regulation of financial markets in the Southern African region.
The terminology used in the financial markets jargon is considered to be highly technical and can some times be confusing. While we attempt to keep a non technical language through out this paper, it is quite impossible to avoid the specific concepts used in the financial profession. For some key concepts, a concise glossary of most of the technical words is provided at request by the author.

The Southern African region: geographic coverage and scope

The broad Southern African Region considered under the present study is defined with reference to the SADC membership, currently comprising 14 countries, i.e. Angola, Botswana, Congo (the Democratic Republic of), Lesotho, Malawi, Mauritius, Mozambique, Namibia, Seychelles, South Africa, Swaziland, Tanzania, Zambia and Zimbabwe. However, our scope is limited by the criteria of readily available data, and the level of financial markets development in the countries under investigation. Angola and the Democratic Republic of Congo are emerging from long wars and are still rebuilding their economies and financial systems. Both have no formal financial market. Accurate and reliable data is very limited on their systems. The study covers a period of 10 years (1994-2004).

Background overview on Financial Markets

The regulation of Financial Markets, taken as a broad concept, is the process that encompasses regulation, (i.e. the establishment of specific rules of behaviour), the monitoring (i.e. observing whether the rules are respected) , the supervision (a more general observation of the behaviour of financial institutions and operators), and the enforcement (ensuring that the rules are complied with) of the established laws.

The ultimate economic function of financial markets is to mobilize and allocate resources through financial intermediation in order to accelerate the process of economic growth. This function is performed through two distinct but interrelated components of the financial markets, i.e. the money market and the capital market. It provides channels for transferring the excess funds of surplus units to deficits ones. They constitute the mechanism that link surplus and deficit units, attracting funds from savers in the surplus sector and channeling these to borrowers for the purposes of profitable investment.

For the purpose of providing a clear understanding of this topic, it is profitable to present a wide overview of a typical financial system and the place of the financial markets holds within this framework. As a practical illustration, we provide in a table of Annex I, the Conceptual Framework of a typical financial market system (the Case of South Africa).

Financial Systems and Financial Markets development

The financial system in the Southern African region consists of providers and users of financial services. The typical financial system consists of a variety of institutions, instruments and markets that facilitate the flow of financial resources between borrowers and lenders. The financial institutions include moneylenders, banks, insurance companies, leasing companies, venture capital funds, mutual funds and pension funds, brokerage houses, investment trusts and stock exchanges.

Financial instruments involved range from currency notes and coins, cheques, mortgages, corporate bills, bonds and stocks to futures, swaps and other complex derivatives. The markets for these instruments may be organized or may be informal. The users of the markets may be households, businesses and the government. Compared to those of developed countries (Europe, Asia and America), the typical financial markets in the Southern African region are characterized by the absence or a limited number and quality of the financial services providers, the absence of many of the instruments and the lack of depth in the markets.

Financial Markets typology and structure

The financial markets play a very important part in the economy of a country and the well-being of every person. They interact with other markets and have an influence on issues such as wealth, inflation and economic stability in a country. The financial markets have their own characteristics and to be able to regulate them or operate in them, it is important to comprehend these characteristics.

Classification of Financial Markets

Financial Markets can be classified into different categories depending on the characteristic of the market or instrument used to create categories. There exist two ultimate distinctions of financial markets. The primary market, i.e. for the sale of new markets, and the secondary market for already existing securities. The capital market, which is the market for the issue and trade of long-term securities, on one hand and the money market, i.e. the one of short-term securities, on the other hand,
In general terms, the money market is the market where liquid and short-term borrowing and lending take place. The lending of funds in this market constitutes short-term investments. In a certain sense all bank notes, current accounts, cheque accounts, etc. belong to the money market.
In financial market terms, the money market exists for the purpose of issuing and trading of short-term instruments, that is, instruments where the term remaining from the date when trading takes place to the date of redemption of the loan represented by die instrument (commonly referred to as the "term to maturity"), is of a short-term nature. In theory, this term for classification as a money market instrument is given as one year. In practice, however (especially in South Africa), instruments with a term to maturity of three years or less are normally classified as money market instruments although this is not a hard and fast rule.
For the purpose of regulation, the classical typology of Financial Markets recognizes the following major distinctions :

the inter-bank and credit markets the Money Market ; the Equity Market ; the Foreign Exchange Market ; the Bond Market (for Government bonds, Corporate bonds, Eurobond market, structured bonds, etc.) ; the Derivatives Market: ( for Futures, Swaps and Options)

Apart from the above mentioned categories, an other important distinction is established between the domestic financial markets and the international financial markets.

The institutional framework for the regulation of Financial Markets.

A financial system cannot be effective without an adequate regulatory framework. For a financial system to be effective and promote healthy economic development, it is important to put in place a sound legal and institutional framework. Various strategies and approaches are generally considered by experts for the development of financial systems. Two major strategies commonly considered are the "evolutionary" and the "proactive" approaches. Other experts have made a distinction between the "go slow" versus the "big bang" approach.
The pro-active strategy provides legal, regulatory and prudential framework which accelerates financial market development through mechanisms, institutions and financial instruments set up for this purpose. This strategy is considered as the appropriate approach for African and other developing countries for three main reasons:

Inadequate neutral incentive environment and market forces that are insufficiently strong for financial markets to develop by themselves. Lack of institution-building capacity to determine the pace and strength of financial markets development. Need for flexibility to allow for the use of the most efficient institutional set-up, required training infrastructure and choice of technology that is most suited to the local conditions and level of development.
The Rationale, Principles and Objectives of Financial Markets Regulation

1. The necessity for a Financial Market Regulation

Why regulate Financial markets? This question is central to the subject under investigation in this paper and before we attempt to grasp the rationale and objectives of financial markets regulation, it is important to understand why such regulation should exist in the first place. The necessity for a financial market regulation finds its basis in the same principles applied to the financial sector in general. Borrowing and lending of money create certain risks, namely : That the borrower will not be able to repay the money ; That the lender is receiving a fixed rate on his investment while market rates fluctuate in such a way that the yield on his initial investment is now below current market related rates ; That the value of the capital invested could decrease due to movements in the market. In order to clearly define the rights and obligations of investors, borrowers, operators and intermediaries involved in a financial system and who operate under contractual relationship, it is of the highest importance to develop a cohesive and comprehensive legal and regulatory framework.

The stakes involved in the running of a country's financial markets are very high and it would be deeply irresponsible to apply the rule of "laisser-faire" in this very sensitive sector. In case some thing would go wrong or the financial system could undergo a serious crisis, it would result into a total collapse of the entire economy.

Such a framework should encourage discipline and timely enforcement of contracts, fostering responsibilities and prudent behaviour on both sides of the financial transaction. For a country's market to develop and operate efficiently, the legislative and regulatory framework should incorporate rules on trading, intermediation, information disclosure as well as strict sanctions against defaulters and cheaters.

2. The Rationale of Financial Markets Regulation

The rationale underlying the financial market regulation is the general philosophy and ideological background pertaining to a specific country's economic orientation, and the type of economic system adopted by the country's leadership. At present, most of the countries covered by the study are characterized by a "market oriented " economy. However, some of these countries have been under a centrally planned economy until the 1990s when they dramatically changed their economic orientation. It is the case of Tanzania, Mozambique and Angola. The changes were particularly due to persistent deficits in public budget and their inability to support the considerable burden of state owned companies unable to achieve the target economic performance. This new orientation facilitated the development of more diversified and active financial systems, leading to the creation of Financial markets in Tanzania and Mozambique. Financial Markets have their own unique characteristics and financial operators differ from one country to an other. The financial market framework should facilitate rather than impede the efficient operation of the financial system.
The Principles of Regulation

In theory, there is a distinction between general and specific principles. The following general principles are widely recognized for the formulation of an effective regulatory process:

Every regulatory arrangement should be related explicitly to one or more objectives identified; All regulatory arrangements should be justified with respect to their cost-efficiency; The cost of regulatory arrangements should be distributed equitably ; All regulatory arrangements should be sufficiently flexible, in the sense of being amenable to changes in markets, competition and the evolution of the financial system ; Regulatory arrangements should be practitioners- based.

Specific principles are identified as follows:

a. Principles related to the regulatory structure: What is the adequate structure for financial markets regulation. One major issue in Financial markets regulation relates to the number of regulatory and supervisory agencies involved. The issue of the choice between a single regulatory authority or multiple specialized agencies is generally resolved according to the following principles: there is a need to adopt a "functional" as well as an "institutional" approach ; the coordination of regulation by different authorities and agencies will help to achieve consistency ; there should be a presumption in favour of a limited number of regulatory agencies /authorities.

In practice, the institutional and functional approaches need to be employed in parallel because regulatory authorities are concerned with the soundness of institutions, as well as the way in which services are provided.

b. Principles related to the market efficiency :

These are principles designed to contribute to the promotion of a high level of efficiency in the provision of financial services. They are : (a) the promotion of a maximum level of competition among market participants in the financial system, and (b) the securing of competitive neutrality between actual or potential suppliers of financial services. Competitiveness is likely to enhance market efficiency, which in turn causes the removal of restrictive practices that could impair trading in financial assets and the rationalization of market activity.

c. Principles related to market stability :

These principles are expected to contribute to the promotion of a high measure of stability in the financial system and an appropriate degree of safety and soundness in the financial institutions. There should be incentives for proper assessment and management of risk. It is necessary to impose acceptable minimum prudential standards to be observed in respect of risk management by all financial market participants.

d. Principles related to conflict conciliation :

Conflict conciliatory principles are designed to resolve potential conflicts arising between regulatory principles themselves. They would involve an integrated approach, aiming at the simultaneous achievement of regulatory objectives, and a target-instrument procedure for the selection of key regulatory instruments in order to facilitate the implementation of an integrated approach.

The Objectives of Financial Markets Regulation

For a Financial Markets system to perform to its highest capacity and level, regulation need to be both effective (i.e. to achieve its objectives) and efficient (i.e. to be cost effective in the use of its resources).

The economic dimension of a financial markets system requires that regulation should not impose unwarranted costs on the economy and consumers, nor impair the efficiency of financial markets. It is therefore necessary to consider a cost-benefits analysis exercise to assess the regulatory requirements.

The more complex a financial market is and more business operators increase, the regulatory process becomes more demanding and requires more specific objectives. Efficient financial regulation requires a multi-dimensional approach and a more optimizing process.

1. The overall objective of financial markets regulation:

The ultimate objective of financial markets regulation is to achieve the highest degree of economic efficiency and the best consumer protection in the economy.

2. Specific objectives:

The following Specific objectives can also be highlighted: to secure the stability of the financial system. It is important for a country's economy to run smoothly and the financial sector must be protected against internal or external shocks which might be caused for instance by ineffective or inefficient trading clearing and settlement systems or a major lack of market liquidity ;

to ensure institutional safety and soundness.The regulatory framework should be extremely cautious and avoid to impose obstacles or barriers that would impair the safety and soundness of financial institutions, which need to be profitable and have sufficient capital to cover their risk exposure and face global competition ;

to promote consumers' protection:

It is crucial for a financial market to impose integrity, transparency and disclosure practices in the supply of financial services.



Concluding Remarks

In all Southern African countries, as it is in all countries of the world, the financial system is more regulated than any other industry. On the consumer protection grounds and others highlighted in this study, it is universally accepted that this should be so. Existing empirical evidence suggests that regulatory arrangements have a powerful impact on the size, structure and efficiency of financial systems, the business operations of financial institutions and markets, and on competitive conditions in the systems.

The success of a financial markets regulation depends basically on the capacity of the regulators to define the objectives of the regulation and also on the way the regulatory arrangements are related to their objectives.

Some of the countries in the Southern African Region which were able to promote a dynamic and effective regulatory framework, such as Botswana, Namibia, Mauritius, Zambia, Zimbabwe and in particular South Africa, are benefiting from the positive development of financial markets, with an unprecedented flow of capital from foreign investors.

However the financial systems in the region are still limited, in terms of the number of operators, quantity and quality of instruments and the depth of the systems. And there is still need to develop regulatory institutions, structures and mechanisms that can maximize the explicit objectives of regulation while minimizing the costs of services.

Financial management and accounting - overview

This article deals with a brief overview of some of the differences between the accounting financial accounting and management systems. But first let understand us what accountant is.
What is accounting? Accountant may be defined as a collection system, summerising, analysis and reporting financially, information about a business organization.Includes as understood today, corporate accounting, accounting and management comptable.Ces two parts of the system business have something in common, and there are therefore differences.
For accounting of business enterprises, these two two mutually differs in many respects.
The first difference is in its structure or format of presentation of the information. financial accounting has a single unified structure of presentation, which means that commercial enterprise system information are more or less presented as finished products uniforme.Les financial accounting are its three basic financial statements, and they are:
-The balance sheet.
-The profit and loss account/result.
-Statement of changes in financial position.
The balance sheet presents the financial situation of an organization at any time. Profit and loss statement would contain the financial performance of the Organization over a period of time, which is usually one year.CHF and the output of the financial resources of the Organization for a period of time is reported in the statement of changes.
Prepared financial statements are based on an equation or a template, which implies that all organisations submit their financial statements on the basis of a uniform structure.This would mean that financial accounting has a unified structure.
Financial statements are usually intended primarily for people outside of the Organization, as shareholders, creditors, Government, general public and, as of other .these people also get these reports from other organizations, and to maintain uniformity in these statements, financial accounting system uses a system of unified structure.
On the other hand, the accounting management is primarily concerned with internal management.Given that the accounting statements are used internally, it varies in the structure of an organization to organization, depending on the circumstances and the requirements for individual use. Therefore, accounting management is adapted to the needs of particular organization management.
The difference is in generally accepted accounting principles.Financial accounting is prepared in accordance with generally accepted accounting principles, which, in brief, is known as GAAP.Whereas in accordance with the following GAAP financial statements preparation ensures that account presentations have been prepared on a standard basis according to the General guidelines issued by the law.
On the other hand, accounting management is internal and is for the exclusive use of the organization management.These statements of management accounting are never made available to foreigners and hence could be formulated as desired as management internal.
The third difference between the financial accounting and accounting management is explained above comptes.Comme establishing statutory requirement, financial statements are prepared only to persons outside of the Organization, who have interests in the operation of the activities of the organization.There are shareholders, who would use the information contained in the Financials, to decide to invest in the organization or non.Par law, it is required to prepare these statements, and is a legal obligation.In fact, the corporate law not only makes it compulsory to prepare these accounts, it has also fixed structures, that these financial statements shall be prepared.
The fourth difference is a reflection of historical accounts.As mentioned above, there are three types of financial accounting are préparés.Dans these three, while the balance and the account of profits and losses report financial position on a particular date and the results of the operation of the organization in a specific period, respectively, the statement of changes in financial position reports the influx and exit resources over a significant period of temps.Par, Financials store historical data .d ', the accounting will not save any financial history of the organization.
The fourth door on the Financials sectorielle.Comptabilité difference relates to business as a whole, although some organizations segment such accounting for its various .but operating centers, as and when financial statements are presented, it shows the enterprise in its ensemble.Contrairement this, management accounting system may submit declarations on a segmented basis.
Finally, financial and accounting management accounting differs from their ultimes.La accounting objectives is prepared specifically for external reporting, where - as management accounts are only for internal use.
In this brief introduction, it became very clear how accounting differs with preparing account gestion.Deux accounting systems are vital to any business scenario and are mandatory requirements in an enterprise environment.
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Retirement - who needs financial planning and financial planning?

When it comes to financial planning, there are many reasons people often give for not making a financial plan. They can range from "I don't have any money" type objections to "I don't have any time right now" excuses. But, in today's turbulent financial world, you must be very careful. Many Middle-Class Americans are one month away from living on the street. The perceived security and safety of a job is illusory (just ask any unemployed American).

Why Do You Need Financial Planning?

In short: life requires self-generated, goal oriented action - a plan. This extends to every area of our lives, including financial. The degree of our planning will determine - at least in part - the degree to which we are successful. And, although a financial plan does not guarantee success, it is necessary for it (at least in the long-term).

Those who scoff at this need to realize that life is motion. It will not stop or slow down for you. If you do not consciously make a financial plan, you will make one for yourself perhaps subconsciously, and randomly, and usually to your own detriment.

Consider the case of "John", who sees no need to meet with a professional financial advisor or learn anything about financial planning. He believes himself to be "small potatoes", or he perceives financial planning as "unnecessary" or "boring" and thus he avoids it - at least for a while. However, what John does not realize (or was not paying attention to) is the fact of reality that life demands that we make decisions every day in a variety of different ways and in different areas of our life.

Money happens to be one of those areas that we are forced to deal with almost constantly, and usually multiple times throughout the day. How do we make the decision to grab a cup of coffee from the local donut shop in the morning vs. putting that money back into our pocket and simply make it at home instead? For John, this decision making is done pragmatically, and emotionally. Whenever he feels like buying a cup of coffee from the local donut shop, he will. If anyone asks him why he spends so much on coffee every day, he rationalizes it: "$1 isn't that much." he tells himself (and anyone that dares to ask).

But John's statement is void of any context. Consider, if we were to put that $1 spent on coffee into an investment yielding 8%, that $1 would become $1,500. Strategically placed at 20%, it balloons to well over $20,000 after 30 years. Would you consider $20,000 to be "not that much money"?

But to be completely honest, this isn't about whether John should or should not buy that cup of coffee, it's about his reason for doing so. His disastrous "reasoning", which attempts to replace a truly objective approach to his financial life, can very easily spill over into other areas of his life. The coffee issue is "small potatoes". The line of "reasoning" is not.

Coffee is not John's problem. What if we were to take a look at another common dilemma in John's life (as well as many other American's lives)? Suppose the decision is whether John and his wife should pay off their mortgage as quickly as they can so that they can be rid of that "evil" mortgage payment and all of the interest that they are paying. As a result of his upbringing, or some in vogue article his wife read in a magazine, or just on a mere whim, John arbitrarily decides that paying off the mortgage quickly is a good thing. He and his wife have a 15 year mortgage, and are making payments on it as quickly as they can. They don't realize that they are losing many hundreds of thousands of dollars by financing a home this way. John is confronted by either a friend or a financial planner who tries to show him how would be better off if he just held onto that mortgage and invested the difference.

Now, John and his wife can rationalize their actions (being afraid to admit to having made a mistake at all) by saying "yeah, well...we just like the idea of having our home paid for". Yet, if pressed for a more thorough answer, they don't have one. When the facts of reality confront them that dumping their 15 year mortgage and carrying a big long mortgage instead (even well into retirement) and investing the difference is much better for them financially, they squirm and cringe and retreat into a mental fog. They no longer have any idea why they like the idea of having their home paid off.

John had decided long ago that he didn't need financial planning. That he had a handle on everything. Now perhaps John, like many other Americans do, continues to ignore or simply continues to dismiss the idea that financial planning is like any other subject - it needs to be learned. What are the consequences of not taking responsibility and the initiative to meet with a financial advisor (one that can teach them how to prepare for financial uncertainty as well as teach them sound financial planning strategies)? Well, in John's case, he eventually retires and without a mortgage. He has lots of equity in the home, but virtually no savings. His home has appreciated and depreciated with the real estate market, but even if he wanted or needed to cash out the money, he would have to take out a loan and pay it back (or sell the house). John and his wife were able to scrape together something that resembles a savings, but because they didn't pay much attention to the real effects of inflation, their nest egg is substantially smaller than what they had hoped for.

In addition to all of this, it's looking like John's wife's health is deteriorating, and she may need long-term care (statistics from major life insurance companies - like Met Life - suggest that 1 out of 2 people - 50% - will need long-term care at some point in their lives). Or expensive medication. Where do they get the money to pay for these things? Perhaps they go without. Perhaps they die prematurely because of it, taking to the grave the erroneous idea that financial planning never could have helped them. Never could have saved them. Never could have helped them live a better life. Yet the truth is the opposite. It could have helped them, and it could help you too.

Financial Planning As Practical

Many people don't think in terms of financial planning as being "practical", yet this key mistake is what keeps many individuals from becoming financially successful. Unless we make it a point to study it in school, our only formal education in finance and economics is perhaps from the worst of all teachers - the Government.

Governments do not induce better money management habits. The concept of deficit spending and the growing national debt that is a result are prime examples of why. They aren't very good at teaching individuals the value of investing either, and the ill-fated Social Security program is a good demonstration of what happens when Government allegedly invests our money for us.

Banks and certain other financial institutions regularly fail during recessions despite the fact that they are heavily regulated by the Government. In fact, at least for the banking industry, it is the Government that promotes such reckless lending and investing policies that lead to such failures. By forcing everyone to comply by the same irrational rules, chaos is inevitable.

The fact that these institutions are supposed to represent the hallmark of good money managers, it should be no surprise that many individuals are completely lost when it comes to personal financial planning. The folks who are supposed to be the experts can't even do it themselves.

The only individual that can help them is the financial advisor. By the very nature of the profession, financial advisors promote thrift, savings, and sound, rational investments and speculations. These are the essential concepts that are necessary for an economy to grow and thrive. If a nation is conserving it's finances instead of consuming them, it has a much better opportunity for growth.

For the individual, the financial advisor promotes personal growth - personal financial growth. And, without growth the only thing open to us is death.

Financial planning - a fascinating career option

Dreaming about a career that gives you a secure, renamed, money, work satisfaction and career developments? A career as a financial planner may be your ideal career option. As a financial planner, you need to work with numbers and people. Financial planning training teaches you how to save, spend, and smart investment.

History of financial planning

The financial services sector has come a long way over the last decade.Earlier it divisions separate in the industry such as banks, brokers, agents, employees of mutual funds and thus of suite.Pour an individual is required to access the Bank for the implementation of loans, visit brokers for investments. Mutual funds have been a completely different industry.

This makes people long for a holistic approach to financial planning.There was need for planning for the education of children, pension, emergencies, etc.Thus, financial planning, a relatively young, émergé profession.

Financial planning professionals takes a holistic approach to financial planners .the individual financial resources management recommendations for growth and preserve wealth, reduce tax, retirement benefits, insurance, planning investment - and much more, depending on the financial situation of the customer.

Financial planning - an overview.

"Financial planning is the process of managing the financial resources of an individual, a way to save and invest wisely."As a financial planner, you need to interact with people and know their needs.

Based on the financial strength of each, you will need to provide for their savings, taxes, retirement planning, investment and thus financial suite.Planification team lets you create an overall strategy to manage financial resources.

A good financial planner has extensive knowledge of the investment, taxes, problems of pension, insurance, benefits and more encore.Un most important assets of a financial planner is the ability to listen.

Work contour

A financial planner helps its clients understand their financial needs and develop a strategy to respond to these besoins.Les various responsibilities include:

Defining the customer-planner establishing data collection of client-planner for customer relationship that analyzes financial resources relationship assessment of the financial situation of the client developing and present strategies Financial Planning visualization of financial strategies implemented policy of monitoring the level of growth fund to provide advice on investments and savings

Financial planners must constantly interact with advisors, lawyers, accounting, trust officers, investment banking and tax officers.

Financial planning is a stressful-based profession on peripheral intensive.Plans financial planners many global research for their clients, manage a specific interest and a financial target, planning for retirement, buy a House, investment, taxes, etc.

A financial planner using questionnaires and interviews to mount a client.Le profile profile includes details on issues such as financial goals, current income, investment, risk, charges, tax, insurance, retirement programs plans for succession, inheritance, benefits and more.

Educational qualifications

If no formal criteria is set to become a financial planner, a Bachelor of business administration accounting, statistical, or funding is considered bon.Une thorough knowledge of statistics, economics, accounting, budgeting, financial and commercial analysis is essential.

Interpersonal skills

Qualified financial planner, apart from being responsible must also have some interpersonal skills base:

It should be a self-confidant, mature listening and understanding must be able to work independently ability to work under diplomatic pressure & energetic good conversation skills
Career opportunities

US News and world report rates the career of a financial planner as one of the ten professions earlier today.

Investments increased by businesses and individuals are expected more rapid employment growth in average for financial planners in 2012.En addition, improving the quality of life and people started on retirement planning.

Financial planners can earn several façons.Certains in fees charged to individual customers, some earn commissions on investments; some receive a salary from their employeur.Toutefois, qualified planner may earn by all three of these ways i.e. a combination of fees, commissions and wages.

Wages for financial planners can vary widely, from $ 18,000 to $ 1,20,000 for those entry-level planners établies.Dans a recent financial survey, certified financial planners gain medium salary of about $ 70,000 per year.

The experience of the financial regulation of markets in the region of Africa South - part 2-

The State of Financial Markets in the Southern African Region

Up to the end of 1994, there were 14 stock exchanges in the entire African continent. These were Cairo (Egypt), Casablanca (Morocco), Tunis (Tunisia) in North Africa; Abidjan (Côte d'Ivoire), Accra (Ghana), and Lagos (Nigeria) in West Africa and Nairobi (Kenya) in Eastern Africa. In the Southern African region, they were Windhoeck (Namibia), Gaborone (Botswana), Johannesburg (South Africa), Port Louis (Mauritius), Lusaka (Zambia), Harare (Zimbabwe) and Mbabane (Swaziland). In 2005, most of other countries in Southern Africa have developed their own stocks exchange markets. They are Maputo (Mozambique), Dar-Es-Salam (Tanzania) and Luanda (Angola).

With the exception of the Johannesburg Stock Exchange, and at a different level, the Zimbabwe Stock Exchange and the Namibia Stock Exchange, these markets are too small in comparison to developed markets in Europe and North America, and also to other emerging markets in Asia and Latin America. At the end of 1994 there were about 1150 listed companies in the Africa markets put together. The market capitalization of the listed companies amounted to $240 billion for South Africa and about $25 billion for other African countries.

In the countries under review, stock markets are particularly small in comparison with their economies - with the ratio of market capitalization to GDP averaging 17.3 per cent. The limited supply of securities in the markets and the prevailing buy and hold attitudes of most investors have also contributed to low trading volume and turnover ratio. Turnover is poor with less than 10 percent of market capitalization traded annually on most stock exchanges. The low capitalization, low trading volume and turnover would suggest the embryonic nature of most stock markets in the region.

We have gathered considerable information on the current state of financial markets in Africa in general, and due to a limited time frame, it was not possible to collate, analyze and harmonize them. The format of this article cannot allow to take into consideration all the data. From the latest information, it becomes clear that with the ongoing reforms within the financial sectors in the countries under investigation, a lot of progress has been achieved in terms of regulatory and institutional capacity building. We could expect more results with the promotion of more open investment regulations, allowing more financial flows in the region.

The Experience of Financial Markets Regulation in the Southern African Countries

The financial systems of Southern African countries are characterized by high ownership structure resulting in oligopolistic practices which create privileged access to credit for large companies but limited access to smaller and emerging companies. The regulatory framework must take into account all the specific characteristics of these systems, and at the same time keep the general approach inherent to every regulatory instrument.

Financial systems in Southern Africa are also noted for their marked variations. Some systems, such as those in Mozambique, Angola and Tanzania were for a long period, dominantly government-owned, consisting mostly of the central bank and very few commercial banks. Up to date, Angola has not developed a money and capital market, and the informal money markets are used extensively. Other systems had mixed ownership comprising central banks, public, domestic, private and foreign private financial institutions. These can be further sub-divided into those with rich varieties of institutions such as are found in South Africa, Mauritius and Zimbabwe, and others with limited varieties of institutions as are found in Malawi, Zambia, Swaziland, etc.

Regulatory authorities in most of these countries have, over the years, adopted the policy of financial sector intervention in the hope of promoting economic development. Interest rate controls, directed credit to priority sectors, and securing bank loans at below market interest rates to finance their activities, later turned out to undermine the financial system instead of promoting economic growth.

For example, low lending rates encouraged less productive investments and discouraged savers from holding domestic financial assets. Directed credits to priority sectors often resulted in deliberate defaults on the belief that no court action could be taken against the defaulters. In some cases, subsidized credit hardly ever reached their intended beneficiaries.

There was also tendency to concentrate formal financial institutions in urban areas thereby making it difficult to provide credit to people in the rural areas. In some countries, private sector borrowing was largely crowded-out by public sector borrowing. Small firms often had much difficulty in obtaining funds from formal financial institutions to finance businesses. Finally, the tendency of governments of the region to finance public sector deficits through money creation resulted not only in inflation but also in negative real interest rates on deposits. These factors had adverse consequences for the financial sector. First, savers found it unrewarding to invest in financial assets. Second, it generated capital flight among those unable or unwilling to invest in real assets thereby limiting financial resources that would have been made available for financial intermediation. Coupled with this was the declining inflow of resources to African countries since the 1980s.

A viable financial market can serve to make the financial system more competitive and efficient. Without equity markets, companies have to rely on internal finance through retained earnings. Large and well established enterprises, in particular the local branches of multinationals, are in a privileged position because they can make investments from retained earnings and bank borrowing while new indigenous companies do not have easy access to finance. Without being subjected to the scrutiny of the marketplace, big firms get bigger.

The availability of reliable information would help investors to make comparisons of the performance and long term prospects of companies; corporations to make better investments and strategic decisions; and provide better statistics for economic policy makers. Although efficient equity markets force corporations to compete on an equal basis for the funds of investors, they can be blamed for favouring large firms, suffer from high volatility, and focus on short term financial return rather than long-term economic return.

In various countries where domestic bond markets exist, these are generally dominated by government treasury funding which crowds out the private sector needs for fixed interest rate funding. With minor exceptions, the international fixed rate bond markets have been closed to African corporations. Thus the development of an active market for equities could provide an alternative to the banking system.

The development of financial markets could help to strengthen corporate capital structure and efficient and competitive financial system. The capital structure of firms in Southern African countries where there are no viable equity markets are generally characterized by heavy reliance on internal finance and bank borrowings which tend to raise the debt/equity ratios. The undercapitalization of firms with high debt/equity ratios tends to lower the viability and solvency of both the corporate sector and the banking system especially during economic downturn.

Case studies in selected countries of Southern Africa

In all countries under study, both the historical background, the level of financial system development and the importance of financial markets structure and operations have considerably affected the nature of the regulatory framework. However, there are few countries whose objectives of financial market liberalization were the basis for the development of a modern regulatory system. Mauritius and Botswana are examples which, together with South Africa and Zimbabwe, have developed some of the most developed and diversified financial markets systems in Sub-Saharan Africa. There is no doubt that economic and financial conditions of the economies of individual Southern African countries have played significant roles in shaping their financial market's regulatory framework.

1. Financial Markets in Botswana

An informal stock market was established in 1989, managed and operated by a private stockbroking firm (Stockbrokers Botswana limited). In 1995, a formal stock exchange was established under the Botswana Stock Exchange Act. The BSE performed remarkably well in terms of the level of capitalization, the value of the shares and the returns to the shares. The BSE contributed to the promotion of Botswana as a destination for international investment.

In 2004, the number of domestic companies listed was 18 while foreign companies listed were 7, and two in the venture capital market. The Bank of Botswana introduced its own paper, BoBCs, since 1991, for liquidity management purposes, and there is a growing secondary market for the instrument. In 1999, the Central Bank introduced an other instruments, the Repos (Re-purchase Agreements) and the National Saving Certificates with the objective to develop local money market and to encouraging savings. In 1998, the International financial Services Centre (IFSC) was established to promote world quality financial services.

2. Financial Markets in Mauritius

The Government of Mauritius has decided as a priority, to modernize and upgrading the financial system of Mauritius and recently took measures to strengthen the financial sector and to further integrate it with both the domestic economy and the global financial market.
Thanks to a well developed network of commercial domestic banks, offshore banks, non financial institutions and financial institutions, the financial system is one of the most vibrant in the Southern African region.

The Stock Exchange of Mauritius (SEM) started its operations in 1989, with only five listed companies. In 2004, more than 44 companies were listed, and the range of activities has expanded, state-of-art technology is being used in the dealings.

In September 2001, the settlement cycle on the SEM was reduced from five to three days, to be in line with major international stock markets. The short settlement cycle has since helped to improve liquidity and turnover on the market as investors are able to sell their securities three business days after buying the, thus reducing risks and bringing better integration to global markets through strict adherence to international standards.

3. Financial Markets in Mozambique

In 1978, all private banks operating in Mozambique were nationalized and merged into two state owned institutions, the Banco de Moçambique (Central Bank) and the Banco Popular de Desenvolvimento (BPD). After the adoption of a new economic orientation in 1992, the Government implemented an economic reform programme including the financial sector reform. Foreign banks were allowed to invest in Mozambique and the regulatory and commercial activities of the Central Bank BDM were separated. Banco de Moçambique assumed the Central Bank function while Banco Comercial de Moçambique BCM led the commercial banking sector.

The financial sector liberalisation policy allowed new institutions. Apart from the already operating Standard Bank, new banks licensed since 1992 or resulting from liquidation of existing institutions include the Banco Internacional de Moçambique, the Banco Comercial de investimentos, Banco de Fomento, Banco Austral, African Banking Corporation ABC, BMI, UCB, ICB, Novo Banco, etc. There are also investment banks, leasing companies and credit cooperatives. This increased number of financial and non financial institutions resulted in the development of an active financial sector.

In October 1999, the stock market of Mozambique (Bolsa de Valores de Moçambique BVM) was inaugurated. Its regulatory agency is the Central Bank BDM and its operations are still limited. With the technical support of the Johannesburg Securities Exchange JSE and the Lisbon Stock Exchange, plans are underway to develop an international financial services centre, including a state-of-the art information technology system.

4. Financial Markets in Namibia

The Namibian Stock exchange NSX is governed by the Stock Exchange Control Act of 1985. Amendments to the Act have been recently adopted in order to bring the national laws in line with international standards.

The NSX was established in October 1992 and is the most technically advanced bourses in Africa, and also one of few self regulated financial markets in Southern Africa. The Namibian Stock exchange Association, a self regulatory, non profit organization, is the custodian of the license to operate the NSX. It approves listing applications, licenses stockbrokers and operates the trading, clearing and settlement of the exchange. Since 1998, the NSX has used the most technically advanced management tools available on the continent, which enable better surveillance and detailed client protection.

5. Financial Markets in South Africa

The South African Financial Markets system is the most sophisticated and complex with the vibrant Johannesburg Securities Exchange (JSE), the Bond Exchange of South Africa (BESA) and the and the South Africa Futures Exchange (SAFEX).

The Johannesburg Stock Exchange JSE was established in November 1887. Currently, it is governed by the Stock Exchanges Control Act of 1985 [amended in 1998 and 2001]. The JSE is the largest stock exchange in Africa and has a market capitalization of more than 10 times that of all the other African markets combined. The JSE provides technical support and capacity building, skills and information to the following exchanges in the region: Namibia, Mozambique, Mauritius, Tanzania and others in Africa (Nigeria, Ghana, Egypt, Uganda and Kenya). Since 1999, the JSE harmonized its listing requirements with the stock markets of Botswana, Malawi, Namibia, Zambia and Zimbabwe.

The BESA was licensed in may 1996 under the Financial Markets Control Act of 1989 [amended in 1998], and the SAFEX was established in 2001 as a Financial Derivatives Market and agricultural Products division of the JSE.

In June 1996, the JSE introduced the fully automatic electronic trading system known as Johannesburg Equities Trading (JET) and since May 2002, is using the Stock Exchange Trading System (SETS).

6. Financial Markets in Swaziland

The Swaziland Stock Market (SSX) was established in 1990 to promote local investment opportunities. In 2002, five companies were listed. The SSX has developed new listing requirements in line with new international regulatory standards. A new security Bill has been approved in 2002, and should be in force by now. It will allow the licensing and regulation of all securities markets, operations and participants.

7. Financial Markets in Tanzania

The Dar-Es-Salaam Stock Exchange (DSE) was incorporated in September 1996 under the Capital Markets and Securities Act of 1994. Its operations however did not start until April 1998 with the listing of the first company. In October 2002, foreign companies were allowed to operate on the DSE. Its regulatory agency is the Capital markets and securities Authority (CMSA). Plans are underway to facilitate the securing of increased financial resources from global markets.

8. Financial Markets in Zambia

The Lusaka Stock Exchange (LuSE) was created in February 1994 under the 1993 securities Act. It is controlled by the Securities and Exchanges Commission (SEC). Its operations were boosted by the successful issue of the Zambian Breweries, which raised up to US $ 8.5 million to refinance a loan secured for the acquisition of the Northern Breweries in 1998. Most of the listings were the result of the country's privatization program.

A Commodity Exchange, the Agricultural Credit Exchange was also established in 1994, as an initiative of the Zambia National Farmers' Union, after the liberalization of the prices of agricultural commodities. The Exchange provides a centralized trading facility for buyers and sellers of commodities and inputs. It provides also updated prices and some market information for both local and international markets.

9. Financial Markets in Zimbabwe

The Zimbabwe Stock Exchange ZSE, is one of the oldest and most vibrant stock exchanges in Africa. It was established in 1890, but had sporadic trading until 1946. In 2002, it had 76 listed companies. The ZSE operates under the Stock exchanges act, which is being amended to take into consideration new technological requirements and to align its contents with international standards (improve the security of share trading, transparency, central depository system, etc.).

The ZSE is open to foreign investors, who can purchase up to 40 percent of the equity of listed company, a single investor can purchase a maximum of 10 percent of the shares on offer. Foreign investors can invest on the local money market up to a maximum of 25 percent per primary issue of government bonds and stocks, and a single investor can acquire a maximum of 5 percent. Foreign investors are however not allowed to purchase from the secondary market. These investments qualify for 100 percent dividend and interest remittance.

Financial Markets Regulation in Southern Africa: which way ahead ?

The major issue in financial market regulation lies in the fact that the legal and institutional framework of most countries is still inadequate to support modern financial processes. Examples of such inadequacy include outdated legal systems leading to poor enforcement of laws. The following challenges are very interesting for further research opportunities.

A cohesive and comprehensive legal framework is required under the proactive approach in order to use the contracts that clearly define the rights and obligations of all intervening operators. Such a framework should encourage discipline and timely enforcement of contracts, fostering responsibility and prudent behavior on both sides of the financial transactions. Prudent and efficient financial intermediation cannot operate without reliable information on borrowers, and some legislation on accounting and auditing standards, which also ensures honesty on the part of financial institutions, Similarly, for a country's financial markets to develop and operate efficiently, legislation should fully incorporate rules of trading, intermediation, information disclosure, take-overs and mergers.

Because of the role of financial institutions and markets in the development of a sound financial system, additional legislation is normally needed for their operations to complement company law. These are prudential regulations, especially for banks and similar financial institutions that hold an important part of the money supply, create money and intermediate between savings and investment. Company law is an example of the kind of legislation needed. It not only governs the operations of business enterprises but also protects the interests of company stakeholders. Thus, public disclosure of information on the company's activities should be made mandatory on company management in the appropriate section of the Companies Act. Such information, especially that relating to finance and accounting, should also be statutorily required to be subsequently verified and attested to by auditors.

Prudential regulations cover such issues as criteria for entry (listings), capital adequacy standard, asset diversification, limits on loans to individuals, permissible range of activities, asset classification and provisioning, portfolio concentration and enforcement powers, special accounting, auditing and disclosure standards adapted to the needs of the banks to ensure timely availability of accurate financial information and transparency. The objective is to enhance the safety and soundness of the financial system.

There is real need for an important legislation relating to financial markets which require not only favorable policies but also legal and institutional infrastructure to support their operations, prevent abuses and protect investors. Investors' confidence is critical to the development of the markets. Brokers, underwriters, and other intermediaries who operate in these markets therefore have to follow laid down professional codes of conduct embodied in the legislation applicable to such institutions as finance and insurance companies, mutual funds and pension funds.

An other important issue is the independence of regulatory authority, their number and the option to establish self-regulatory agency. All these aspects should take into account the objectives and principles defined by the government, and also the specific development needs in the financial system.

A major challenge concerning the Financial Markets in the Southern African region is the harmonization of the national financial regulation and the compliance with international requirements, including the SADC criteria and the international standards set by international organizations such as the International Organization of securities Commissions (IOSCO), the International Accounting Standards Committee (IASC), the Basel Committee on Banking Supervision (BCBS) and the obligations resulting from the WTO Agreement on financial Services (GATS). These key international instruments are starting to be enforced and individual countries have to keep updating their financial markets regulations and upgrade the technical skills of their staff in charge of regulatory and supervisory operations.