How Banks are Slowly Losing their Position in Global Finance

Since 2007, economic growth all over the globe has been persistently slow. Simply put, money is not going to places where it should be. 

For this reason, the banking industry is in great doubt. There are bigger compliance costs and a drop in margins which has pushed banks towards more consolidation. When there are fewer banks, then there will definitely be a drop in competition. 

This has far-reaching effects on the end users of the financial services and the banks themselves. For starters the banks will be more fragile and will depend greatly on the governments to underwrite their lending practices.

This is just one of the many changes that are being noticed in the financial system. It is gradually changing. People are favoring hedging activity over real investments thanks to widespread uncertainties. 

At the same time, there is the growth of the FinTech frontier. This one is further degrading the banking system’s traditional income streams. The banks are going to have a really hard time surviving in the market pretty soon. 

The only way that they will remain relevant is if they take time to reconsider ways of capturing new customers, transacting and engaging with the new and current customers. 

Banks losing opportunities

Getting new customers is very important in the growth of any business. Growing new business and stimulating the economy of the world is vital for the banks. 

Close to two billion people all over the world remain under-banked or completely unbanked. This is a great lost opportunity for the banks. For these individuals, the lack of access to financial and banking services means that they have a hard time growing businesses and taking up new ventures.

Banks try to make as much profit as possible without landing themselves into debt. 

For that reason, the banks have always been reluctant to offer services to this segment of customers. 

They have an unknown risk profile, their income is low and wealth limited. Geographic dispersion of the potential customers makes work even more difficult. They are simply too expensive to provide service to.

Opportunities for other individuals

This might have been true a few years ago, but now targeting these individuals has become so much easier and more profitable. 

Consider businesses like Lending Club, Ant Financial and M-Pesa (a mobile money transfer service offered by Safaricom in Kenya). These are among the most profitable businesses in the world of finance. 

Safaricom is a telecommunications company with M-Pesa as part of its brands. M-Pesa currently generates close to 60% of the whole company’s revenue. 

The thing about these businesses is that they are targeting the individuals at the grass root level. They are able to access financial services with more ease. 

Whether it is getting loans, making payments, transferring money or saving up for a project, people are able to do that with such ease now. This is where FinTech has brought the world.

Banks are not going to benefit much from acquisition of these startups. This is mainly because of the data integration processes. 

The banks will be able to acquire the FinTech startups but then they will not be able to integrate the technology into their legacy systems that fast.

The new face of global finance is the internet-based banking services. They are at a better capacity of integrating the FinTech startups into their businesses. It is no wonder online business is booming as much as it is. 

These online banking facilities make it possible for people to carry out transactions of all kinds online. Even if one does not have the time to go to their bank to place a money transfer order, they are able to send it to use their cards online. 

This is where global finance is headed, everything is done from home.

8 Hobbies that Will Boost Your Creativity

Whether you consider yourself a creative or not, having a hobby that stirs your creativity can enrich your life in many ways. 

A creative hobby can help you reduce stress, express your emotions, and see the world in an entirely new way. And even if it’s a hobby you aren’t skilled at, the simple act of practicing some form of creativity regularly is going to increase your creativity. 

Here are eight hobbies that you might consider picking up if you want to invite more creativity into your life.

Photography

Photography has a way of helping you hone your “artistic eye.” As you practice composing photos and identifying good shots, you’ll begin to see the world in a more artistic way. 

You don’t have to be a photo expert to take up photography, either. With the conveniences of digital photography and high capacity memory cards, photography has truly become a no-pressure hobby that you can practice for hours on end, without draining your wallet on expenses like film and film processing. 

In addition, with dSLRs, compact system cameras, action cameras, drones, and point-and-shoot cameras, consumers have more camera options to choose from than ever before. Find a camera that you feel you can learn with and grow into, and start shooting!

Reading

Reading is a timeless hobby that just about anyone can enjoy—when they choose the right books to read, that is. And as this article points out, with nearly 130,000,000 published books to choose from, you’ll never run out of reading material. 

Reading can boost your creativity because it introduces you to other styles of writing, broadens your perspective, increases your knowledge base, and improves your vocabulary. Reading is an especially powerful tool for those looking to improve their writing.

Writing

If any two hobbies were perfect complements of one another, they would be reading and writing. Writing can boost your creativity by encouraging creative thinking and forcing you to think more deeply on the things you are writing about. 

And with social media and blogging so prevalent these days, just about anyone can find a writing platform and format that works for them.

Playing a musical instrument

Since learning to play a musical instrument engages your mental, emotional and cognitive abilities all at once, it stimulates your brain to think out of the ordinary. 

Practicing and learning to play an instrument will require patience for sure, but it will also allow you to engage in creative pursuits like covering popular songs and writing new songs.

Drawing and painting

Drawing and painting have the power to nurture your creativity by showing you color theory in action, encouraging you to come up with creative solutions, and allowing you to think out-of-the-box. 

Many people never pick up a pencil or paintbrush because they don’t consider themselves artists—and drawing and painting are so stereotypically artistic. The thing about drawing or painting, though, is that no one has to be an expert artist in order to pick up charcoal or a paintbrush and take it to canvas. 

If you’re nervous about starting, you might sign up for a local drawing or painting class that is geared toward artists of all levels—or just watch some Bob Ross.

Cooking and baking

You can also express yourself in the form of food. You might delve into a hobby of cooking or baking by first finding a cookbook or food blogger you love and trying out their recipes. 

Then, you might indulge your creative juices even further by creating some recipes of your own. A good place to start when creating your own recipes from scratch is to try to re-create your favorite dishes at your favorite restaurants.

Flower arranging

You don’t frequently see flower arranging as a hobby, but florists will definitely tell you that there is an art to creating bouquets and centerpieces. 

Flower arranging is an art that engages attention to detail, color theory, and skills in balance and composition. As an added bonus, this one hobby that is sure to beautify your home.

Blogging

Just as this article about nurturing creativity discusses, blogging is a highly versatile hobby that offers a multitude of creative outlets. 

You might use blogging to practice your writing skills, or you might use it as an excuse to go out and practice your photography skills. You can also use it to showcase artwork, to review books you’ve recently read, or to try your hand at videography. 

Whatever creative hobby you might have, blogging can help you delve deeper into that hobby and continually find inspiration.

Four Things To Consider For Successful Retirement Planning

Retirement planning is important. Of course, you know that; but that doesn't make it any easier. For one, it is difficult to plan for something you have no experience with. 

For another, thinking about that stage of your life can already be stressful enough. But no matter how difficult it may be, it is, indeed, quite necessary.

And so, with that in mind, here are a few things to remember as you begin working with Rothenberg Capital Management.

Longevity

Obviously, your plan needs to attempt to take into account how long you will live after you retire. 

Modern health advancements and better awareness means that people are living longer these days—even three or more decades past the age of 65—and you will need to account for your lifestyle over those final years. It could be very easy, then, to outlive a savings account without thoughtful and careful planning. 

Read More: Saving vs.Investing

Furthermore, the average government pension benefits—at least, right now—falls just shy of $1,666 a month. 

Even for a full-time working adult, this is not enough to live comfortably in most cities. Thus, effective retirement planning will probably require some kind of dividend interest or annuity account that yields more money over time.

Inflation

While sticking money into an account and letting it mature is a pretty simple concept—and easy to accomplish, for the most part—it becomes increasingly important to consider how inflation will affect your money down the road. 

Since most retirement plans take several decades to mature it can be exceedingly difficult to anticipate the value of your money when you plan to use it.

For example, an inflation rate of 2% would lower the value of an initial $50,000 investment to only $30,477 after 25 years. At the same time, though, something that costs $50,000 today might cost more than $82,000 in the same 25 year period. 

 Yes, it is complicated; unfortunately, it is necessary to learn how to account for all these things—or hire a professional to help you—in order to make sure you cover all your bases.

Volatility

Similarly important as understanding and accounting for inflation, you also need to have ultimate awareness of market volatility. Volatility is the term used to describe the consistent—and sometimes unpredictable—fluctuations of market activity over time. 

Volatility may be easily managed by a high-activity trader with a diverse portfolio who can move, buy, and sell shares several times a day.

Stock investing, though, can be a profitable aspects of retirement planning, despite how uncertain they can be sometimes. And, despite how it might feel at the time, history consistently shows that markets typically recover—but it can take some time. 

For example, right now, data shows that the market has demonstrated positive annual returns 80 percent of the time over the past 35 years; showing an average intra-year decline of about 14 percent.

Balance

Okay, so you have determined how much you think you need and which accounts and investments you think will yield the best results. Your money has been maturing over a decade or so and you are approaching retirement. 

How much can you comfortably withdraw from your retirement account while also maintaining your steady growth?

This probably sounds complicated—and it can be—but it doesn't have to be stressful. In fact, this is just another part of planning. And then you have to be disciplined in how much you withdraw and how you use your money.

6 Things You Should Never Do On Your Own

There is a reason why we are here on this earth with other people — so we can “get by with a little help from [our] friends.” 

While it is important to be independant and self-sufficient, there are just some things that you shouldn’t do alone. Read on to learn more. 

Wedding Dress Shopping

When you go wedding dress shopping, take a trusted friend with you to help you pick the perfect dress. 

They can look at you from all angles, take pictures for you to see, let you know if you’re making a poor choice, but also affirm your decision if you find the perfect dress. Just don’t take too many people with you, or you’ll end up with too many opinions, and potentially choose a dress that you wouldn’t otherwise. 

Always go with your gut. If you fall in love with a dress, don’t let others persuade you to change your mind.

Apartment Hunting

When you’re looking for the perfect apartment, you want an extra set of eyes. Like this blog says, it’s too easy to be distracted by unimportant details (hot tub out back, cute kitchen tile, etc.), but having a friend with you will help you stay focused on the things that really matter. 

It’s also a good idea to take a friend because it will keep you safe, especially if you’re headed into a more dangerous part of town. When you’re apartment hunting, don’t be afraid to snoop around in the apartment (and even use the bathroom!), and drive around the neighborhood to check out the area.

Automobile Shopping

Car dealers are very sneaky people, and as such, you should never go car shopping alone.

They know how to read you like an open book, and they know how to push a sale. When you’re first met by a salesperson, you will be overwhelmed at how charming they are. 

Pretty soon though, they will use that charm to try and convince you to buy just about anything. If you look at a car for too long, the keys are suddenly in your hand, and you’re ready for a test drive. 

They know that if they can get you in the car, you’re a lost cause. They slowly wear you down until it feels ridiculous and almost like you are a bad person if you don’t buy that car.

However, if you bring a friend, you suddenly have someone on your team. When the rest of the dealership teams up on you, you will have someone who can be the voice of reason.  

They can help you say “No” when necessary, or help you negotiate a better deal. Just make sure that you bring the right friend, or you both might end up leaving with new cars that you can’t afford. 

Clothes Shopping

Window shopping alone can be quite dangerous, especially if you’re prone to shop therapy. Having a friend will help you avoid buying too much, or if necessary, from passing up a steal. 

Before you go, communicate your shopping goals — whether you are just browsing or you’re looking for something specific. A friend can help you stay focused and avoid buying things that you don’t need, or convince you to buy something that you’re on the fence about. 

Besides, it’s more fun anyway! Again, make sure that you bring the right friend, or you might be talked into making a lot of purchases you wouldn’t otherwise.

Haunted House

Going to a haunted house alone is a terrible idea. If you are terrified, there is no one to act as a buffer between you and the actors trying to scare you. 

On the other hand, if you’re not afraid of haunted houses, it will be quite a bore if you don’t bring someone who is afraid. 

Other tips for haunted houses include: try to stay away from other groups, go with the right attitude, go earlier in the night, and don’t try to predict the haunt, or it’ll be less fun.

Attending a Concert

Concerts are infinitely more fun with friends. You have someone to fangirl with, scream at the top of your lungs with, and to talk you out of going crowd surfing. Just don’t choose someone who is uninterested in the concert, or you will wish that you never went in the first place.