Irish Financial Review

Putting the time value of money to work for you

Picture this. It is the winter of 2045, you are retired and you have had enough of the cold winter days and long dark evenings. You would love to turn the lock on your front door for a few months and head south to the sunshine, perhaps inviting some friends to join you for Christmas lunch on the veranda, overlooking the sea.

Value of Euro about to be shredded

How much money will you have when you retire


Or perhaps you are a traditionalist, and you like the idea of spending Christmas at home, but wouldn’t it be lovely to treat the grandchildren to something special, like a trip to Lapland to see Santa and his reindeer.

For many  people reading this article, these options will be out of their reach in 2045, primarily because they will lack the financial resources to make it happen.

Today, the average person in their thirties or forties can expect to live to 90 and beyond, and surely it is worth spending a couple of hours understanding how your future will unfold over the following decades. The rewards could be well worth your while, giving you real choices which you can only dream about right now. The alternative is to find yourself locked into an existence where you will have plenty of time to look back and regret the decisions you made.

As an example, a bar of chocolate in 1985 cost 30c and today it costs about €1. By the time 2045 comes around you can expect a chocolate bar to cost say €3. Clearly you should take this rise in prices into account when planning for your future, otherwise you are going to be very disappointed when you get there.

Wouldn’t it be great if there was some way for ordinary people to realistically understand how much the money they are saving today will really buy them in the future. In fact there is such a method and it is known as the Net Present Value (NPV) technique. It has been in existence since the 1930’s and today it is widely used by businesses to help them make long term investment decisions. In fact this technique should also be used to help you plan for the future.

MoneyWhizz has developed a suite of short videos which show you how to assemble the data and make the NPV calculations which help you make better long term investment decisions. Remember that it is the same technique that is used both at a business and at a personal level. Therefore if you learn this method you can apply it immediately within your current business to help choose the best business projects,  but also you can use it at a personal level to optimise how your personal investments perform. So learning how to carry out the NPV calculation could be good for your short term career, which in turn will lead to higher remuneration, which you can then invest with an eagle eye, to make your dreams come true.

How frugal living and patience are keys to growing personal wealth

Ronald Read  lived in rural Vermont and pumped petrol for a living. But on his death, friends were surprised by his wealth.

Personal Wealth Management Key to Long Term Financial Success

Personal Wealth Management Key to Long Term Financial Success

Mr. Read, a longtime resident of Brattleboro, Vt., died in June at the age of 92. His friends were shocked when they learned his estate was valued at almost $8 million. Long widowed and with two stepchildren, he left most of his money to a local hospital and library.

So how did he manage to pull it off? Besides being a good stock picker, he displayed remarkable frugality and patience—which gave him many years of compounded growth.

He lived modestly, working as a maintenance worker and janitor at a J.C. Penney store after a long stint at a service station that was owned in part by his brother. Those who knew him talk of how he at times used safety pins to hold his coat together and sometimes parked his 2007 Toyota Yaris far from where he was going to avoid having to feed the parking meter.

When he died, Mr. Read left behind a five-inch-thick stack of stock certificates in a safe-deposit box. The shares represented the bulk of his estate, and his executor and Wells Fargo still are working to determine their exact worth.
To Have and to Hold

Friends say Mr. Read typically bought shares of companies he was familiar with and those that paid out hefty dividends. When dividend checks came in the mail, he deposited the money back into more shares.

Physically holding stock certificates became passé for investors more than a decade ago, but Mr. Read held onto his.
In recent years, as investing shifted to electronic platforms, firms began imposing fees for ordering the actual certificates. So Mr. Read turned to a more thrifty option, agreeing to have his purchases held by the official record-keeper for share ownership—known as a transfer agent—that each public company employs. That likely saved him from $25 to several hundred dollars per transaction, says Peter Duggan, a senior vice president at transfer agent Computershare.

By buying shares this way, he likely also paid low fees, even compared with those charged now by many online brokerages for do-it-yourself investors. The average fee for buying shares in a so-called direct-stock purchase program is about $3 at Computershare, Mr. Duggan says.

Mr. Read relied in part on print publications for his investment research and, while he subscribed to The Wall Street Journal and Barron’s, he also made use of the local library. He also chatted about investing with those he knew, including a neighbour who also was his Wells Fargo adviser in Brattleboro. He regularly sought advice from this adviser and kept a brokerage account at the firm, but it held only a small portion of his investments, according to Mr. Read’s attorney, Laurie Rowell.

For today’s investor, using Mr. Read’s exact approach could be somewhat cumbersome. The fees now charged for paper certificates make that kind of trading expensive, and having purchases held by a transfer agent puts an added burden of research and record-keeping on the investor. Most low-cost investors these days favour the ease of online trading platforms and the ready accessibility of research on the Internet.

From Anna Prior, Wall Street Journal

Protecting against fraud and exploitation in retirement

By Frank Conway

A lot of what I have written about as well as content in media in general focuses on financial topics for those in the 20 – 50-something age bands. These include mortgages, investing and savings.

Personal Wealth Management Key to Long Term Financial Success

Protecting against fraud and financial exploitation is key to a successful retirement

One area that I have noticed that receives less coverage is financial planning for those already in retirement. No, I am not talking about financial planning in the strictest sense, rather I have focused in the area of loss prevention.

I have published a new e-book that provides high level tips to those in retirement already about how they can protect themselves against fraud and exploitation.

If you know of someone that may benefit from my Protecting Against Fraud and Financial Exploitation in retirement, please feel free to make contact and request a copy.

Teaching our future generation how to handle money

It’s taken a while to get here but MoneyWhizz is about to go live across Ireland. Already, over 50 schools have signed up for the programme and will shortly be receiving their unique login and password details to get them started (the programme is also available in the US and UK).

This has been a really important project for me and one that I feel very strongly about. Teaching our youth how to manage money is a critical life skill.

If you have an area school that would benefit from MoneyWhizz, let them know about the programme. This is sure to make a lot of difference in the lives of our students and young adults.

You can access further details at

Five ways for small business owners to improve their financial performance

For small business owners, a deep understanding of their company’s financial situation will significantly improve their chance of long-term success. When they know exactly where they stand in terms of their financials, they can plan for the future and avoid common financial management pitfalls.

money talk

Financial literacy skills for small business owners are critical for success in todays global economy


Unfortunately, the fact remains, business owners struggle to get a grasp on their finances. In a recent North American study, 46 per cent of owners rated their knowledge of financial management as sufficient or less, while one in 10 surveyed believe that a lack of financial management knowledge is the greatest barrier to small business success.

Around the world, a common mistake made by owner-managers is to assume that accountancy is finance – nothing could be further from the truth. Accountants are financial historians whereas in business finance, this involves a very high degree of forward planning.

The following tips have been compiled to provide some general guidance to assist owner-managers take greater control of business finances, improving financial literacy and taking their company to the next level:

1. Do the sums. Do you know how much money it takes to run your business? Determine the true costs of your products and services, including wages, transportation, rent, marketing, insurance, phone, internet, utilities, taxes, and whatever else you require to function. That’s just the beginning. You need to learn how to effectively track money in and out of your business, a first step of which would be setting invoicing periods.

2. Uncover those other costs. Have you ever needed to obtain license? Even securing an online presence requires time and this costs money. The expense of these things can start adding up, especially when you factor in the cost of legal services, your own salary, return on investor capital, and capital for future expansion. Don’t forget to add the cost of borrowing money and the interest and debt you may have already accrued. Then start thinking ahead: once you can put numbers to everything that takes money out of your business, you can plan how much you will need to grow going forward.

3. Don’t avoid the necessary. A major challenge for business owners (this is true for large and small firms) is that if they don’t fully understand the figures, they assume someone else will…and will also look out for them. This is a major mistake. Not because of any trust issue but because owners with even a good level of financial knowledge can challenge costs and the impact costs can have on the performance of the company. This includes knowing and using of – income statements and balance sheets, understanding inventories and learning to manage cash flow and supply chain.

4. Take the landscape view. Become familiar with the general state of your immediate marketplace. Analyse your competitors and ascertain how your company stacks up against them in terms of goods, services, and pricing. Do a SWOT analysis and determine competitors’ strengths and weaknesses and identify opportunities therein. Additionally, work on deepening your understanding of your customers and figure out if they could and would spend more for what you provide (there are some easy – and free online tools that can assist you here).

5. Learn how to use financial training software. Business owners no longer need to take long journeys or days out of the office to improve essential financial skills. New online resources such as Ablata can provide valuable up-skill services that can assist owner-managers improve their financial skills significantly for a fraction of traditional in-class settings. Whether you have a good understanding of finance or are just starting to learn, pioneering software options can be structured to help owner-managers become proficient in the language of business finance in as little as 12 hours.

Worth isn’t just about price or what to charge – it’s about the true value of your business, which involves a combination of factors: your products, services, competitive landscape, and the value your business brings to customers. By educating yourself on your financials, and working with the correct tools and credible professionals, you’ll be on your way to a lifetime of success – without leaving anything to chance.

Irish motorists could be stripped of licences under new EU laws

The European Commission is proposing to ‘harmonise penalty points’ in move which could see Irish motorists stripped of their licences if they are caught speeding while they are abroad

Irish Financial Review - Speed Cameras

New rules could extend penalty points across EU


Irish motorists caught speeding or committing other motoring offences in Europe will face fines and could even lose their licences under new EU laws.

At present motorists using their own vehicles abroad avoid punishment if they are caught by speed cameras. They only face fines if they are stopped by a police officer at a roadside.

The European Parliament is on Wednesday expected to vote in favour of new measures that will give police forces the power to issue fines across Europe and to pursue offenders in courts abroad.

The new rules are expected to be supported by the vast majority of MEPs, and cover penalties for speeding, ignoring red lights, drink and drug driving and driving while using a mobile phone.

Next year the European Commission will also, under the same legislation, review whether it should introduce “harmonisation of penalty points”, under which motorists who commit motoring offences abroad will get points on their licence.

How most students are being cheated when it comes to money

Secondary school students are studying up on mathematics, physics, advanced chemistry, and world history, but most aren’t learning fundamental money lessons to help them financially navigate the real world.


MoneyWhizz - money samples

Financial education provides lifetime benefits to students


Such is the case with students all over Ireland who struggle with the basics of personal finance. Even in so-called ‘top rated schools, students are being neglected when it comes to basic personal finance.

The assumption is that somebody else will teach it” said Mr. Frank Conway, Founder of, the personal money management and personal budgeting service.

Across the globe, there is a growing chorus of influencers calling for the introduction of financial education to be introduced into the curriculum. Both the OECD and UNICEF have been calling for such material to be introduced at school level for years.

What is really concerning are the findings of a study carried out by Harvard University which reveals that even smart students don’t have an understanding of personal finance” said Mr. Conway.

Growing complexity that parents and teachers couldn’t be expected to fully understand

Part of the problem is that the financial system has become increasingly complex. New rules, new products, new technologies have made many areas of personal finance more and more abstract. For example, many people no longer fully understand how complex mathematical models track how they borrow and repay their debts. These can have life-long implications across a range of areas ranging from credit to employment. Also, for students that may live and work abroad, personal credit scores will impact their insurance costs, ability to rent property and in some cases, whether or not they get admitted into hospital.

Personal credit reports have become our most important social media profile yet nobody teaches this stuff to students” said Mr. Conway.

Deemed preserve
Interest is there, opportunity in not. In a US poll, 84 percent of high school students desire more financial education. Among 16- to 18-year-olds, 86 percent said they would rather learn about money management in the classroom than make financial mistakes in the real world.

Irish parents have also expressed concern, as have grandparents. In 2011 – 2013, Cents & Sensibility – a financial guide for young adults sold out in a matter of weeks at Ireland’s top book store. This was despite the fact the book was marketed via word of mouth and testament to the emotional appeal of teaching finance to the next generation.

There is a market demand for personal finance knowledge but too often, there are few answers to solve the lack of training” said Mr Conway.

New programme
MoneyWhizz is a new, non-profit programme developed specifically for students aged 16 – 20. It teaches 10 essential money lessons that every student will require knowledge of as they become financially independent.
In Ireland, a number of schools are beginning to buck the trend with gradual introduction of personal finance to students. But the major difficulty for teachers and schools is the lack of financial resources.

Free, Independent, Commercial-free
MoneyWhizz offers 10 core money lessons that have been specially written and edited for students. Schools that would like to avail of the MoneyWhizz programme can contact


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