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To continue to live a life that you have grown accustomed to

By Raoul Ruiz Martinez features@algarveresident.com

Raoul Ruiz Martinez is a consultant for Finesco Financial Services Ltd., Glasgow and regulated to advise on capital investments in both the UK and throughout Europe under the MiFID regulation.

It’s taken the dire combination of an escalating sovereign debt crisis in Europe, revolution through Northern Africa and the Middle East and the shock of natural disasters in Japan to remind us how fragile our world is.

As in 2008, the world can become a very dark place within seconds where only the brave can face up to the fact that sometimes we have no control over what happens around us.

I was mulling over this summary in my mind very recently when I happened to be sitting in an airport lounge awaiting a flight.

At the same time, I became engrossed in a financial journal article. It began with the statement that in certain European countries over 50% of their population are going to be over 50 within the next 10 years.

It went on to explain in no uncertain terms that this will alter society and presently the ageing population is already having an impact, where their children face longer working lives in order to save enough money to have any hope of the comfortable retirement their parents enjoy.  

For a moment I looked up to check whether or not there was any progress on boarding the flight, when I began scanning for a moment as to what others were reading.

One young woman in her 30s was reading a high profile fashion magazine and a man, slightly older, was also reading a man’s sports/fashion magazine.

I am not writing this to compare the quality of content as many financial articles can be boring or ridiculously speculative, but rather highlight the fact that the younger population who have been born out of decades of debt don’t see the point of saving for the future and continue to drive towards a “spend” culture.

These 30-40 year olds are not too far away from becoming part of this growing population, I thought to myself. In fact, if the article’s statistical predictions are in fact correct, these 50 year olds are the 30-40 year olds of today!

Could there be another looming economic and financial problem (it could even be dubbed “crisis”)?

While there are many things we need to live our lives, such as mortgages and healthy income, there are many things that we do not need (or that clever marketing make us believe) that drives this incessant culture of spending and borrowing.

Accompanied by this era of austerity measures, we do not have the budget today to resolve tomorrow’s problems in the same way we have come to expect over the years. 

So, more than ever, we have to ensure that we are comfortable in the later years and also to help our children as they face more years at work and debt loads.

Those fortunate enough to have close family members with financial support can maybe take some of the strain off of the financial pressure by providing a deposit for a home or even provide a savings facility for them.

For others, saving is at the complete opposite end of the spectrum but necessary to prepare for a long and hard future that will eventually pay off.

A simple place to start at is to do a constructive income and expenditure analysis to fully understand what your disposable income is and understand what you can afford to spend and what you can afford to save. How you save is another matter and is based on a number of criteria to make it worth your while and should be well thought through. 

Wars and disasters will always cause a shock to the system but prepare your savings now to make life easier for you and your family’s future to endeavour to continue to live the life you have grown accustomed to.

This article is intended to provide a general review of certain topics and its purpose is to inform but NOT to recommend or support any specific investments or course of action. 

Raoul Ruiz can be contacted at the offices of euroFINESCOs.a. either by telephone on 289 561 333 or on email raoul.ruiz@finesco.com

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