In the first post, I wrote that you should not follow previous habits and that you should first and foremost solve the time or periods when you can’t or no longer want to make money. This post starts much better.
First, I promise not less than long life. (No, there’s no free beer, at least for now.)
According to the latest WHO data published in 2018 life expectancy in Hungary is: Male 72.3, female 79.4 Although the retirement age will rise in the coming decades, we can live as a pensioner for more than 12 years. Great views! If you’re reading this from abroad, here’s where you can find out your country:
Unfortunately, however, there is a good chance your pension will not be enough to maintain your current standard of living, and even in less fortunate cases to make a living. Moreover, the amount of the pension may be much lower for women as it stands because of wage differences.
If we assume that in 20 years’ time Hungary will be characterised by the current situation in Western Europe, still do not expect much good. The difference between women’s and men’s pensions in Western Europe is currently doubles the pay gap and reaches 40%, the Financial Times wrote, citing a 2017 survey by Mercer.
Google this expression: state pension calculator + your country (France or UK) and you will get some very basic view about your chances.
“It’s unpleasant, but there’s nothing we can do about it, let’s keep going,” he said. Well, wait for a sec!
When you started the last lifestyle-change program (you stopped drinking coffee, cigarettes, evening feasts, dropped 3 or 30 kilos or anything like that), I guess you assessed your weaknesses and the causes of past failures first. This is the best way to reach more success than in the previous ones. Let’s go together.
Why don’t you watch your finances?
First of all, no shame, you’re not alone. According to recent surveys, most of the population still expects the state pension system as a major source of income. At least three quarters of them do not have an emergency plan, which would apply if, for some reason, before retirement, they would lose their regular income. Downsizing, longer illnesses in the family, unexpected legal case, a more complicated leg fracture with surgeries, and there’s already trouble. Let’s make sure this does not happen.
Second, because no one taught me or if they taught me, they didn’t tell me it was important. In fact, it’s IMPORTANT. Our generation has never seen any fun financial educational films. Even when we took out our loans, the small letters could not be read without glasses. No socialization, no drive, no motivation. How much do you know more about the pros and cons of the Atkins diet, the straws that threaten the wildlife of our Earth than about short-term investments or which credit will be best for you in 15 years?
Third, because we are afraid to grow old, just as we fear that we will be sick and incapable of looking after ourselves. And what we don’t think about is non-existent! “Right? Don’t make silly jokes…. The last time you were able to calm with this argument your child was when he was 4. That’s why face the financial bogeyman, because it’s really under your bed.
Finally, it’s because our brains are furnished to be afraid of failure. Otherwise, the saber-toothed predator would have eaten us, and we wouldn’t have hunted him down. If resources are limited and the dangers are significant, we respond by delaying, postponing. We’re trying to push the threat to the end. In this case, it’s the worst tactic.
Since we’re already close to the kitchen psychology, we should take at least this very useful advice:
It is best to cut the task into parts.
So let’s not move on now than making a schedule. In the following few steps you will reach the holy grail. (but up to at least one well-structured financial portfolio) Here’s how I plan it:
- Financial planning, financial situation assessment: what and how much?
- Where to turn: institutional system, investor protection, retirement savings
- How to choose?
- Performance measurement, redesign
Can we get started? Of course, it’s impossible to become a well-trained and experienced financial professional after reading a few blog posts, but below I’ll show you some good examples that I trust. I will teach you how to choose well-trained and experienced financial professionals for your side. Come back, we will go on.