The current recessionary phase in the global markets is said to be worst since the days of Great Depression in the 1930s. In such a scenario, it is only normal that the common investors should be worried about the effectiveness of their financial planning procedures. Financial recession lowers the value of money, affects liquidity in the market and can bring about severe credit crunch situations in the economy. Thus, careful strategy-making, matching the dictates of an investment recession economy, is called for. If investors are indeed able to revise their finance plans according to the market conditions, they can still reap rich rewards from their investments.
Most financial planners agree that there are specific ways in which finances need to be planned out at the time of recession. Let us now discuss some of the ways to avoid the potentially adverse effects of financial recession in the markets. These methods can be listed as under:
Preparing well in advance – Just like a booming financial market, investment recession is also a probable situation that might prevail in the economy. As such, investors need to be prepared for such economic downturns. Strategies should be in place to combat such recessionary conditions, and that too, well before recession actually sets in the market,
Career development – Two of the most common effects of financial recessions are job losses and significant cutbacks. Hence, in such cases, individuals need to be continually on the lookout for new, lucrative job opportunities. The curriculum vitae-s of the people should be updated, and care should be taken that the professional careers of people receive the necessary thrusts even at the time of recession.
Securing savings amounts – Since money is available only at a tight leash during phases of financial recession, extravagant spending needs to be avoided during this period. Unnecessary and avoidable expenses also need to be cut down on. All this would be handy in growing a significant savings fund for a person, and
Insurance coverage – If a person does not have suitable medical insurance coverage policies, (s)he runs the risk of going bankrupt in the face of any medical urgency. Hence, insurance policies need to be in place, and particularly so at times of recession. One should also adopt insurance schemes for his/her dependents, including education loans for the latter.
Financial recession, although serious at this time, is not a permanent phenomenon, and the markets would recover in time, according to experts. However, as long as these investment recession trends are prevailing in the market, investors need to tread cautiously while forming their finance strategies. The planning process, if done properly, can ensure that investors continue to earn profits, even in the presence of recessionary conditions.
By: Sambit Sahoo
Posts Tagged ‘Lucrative Job’
Financial Planning at the Time of Recession
February 1st, 2010Financial Planning Salaries
November 7th, 2009
Financial planning is a lucrative job today. With more and more people earning more and more money, it is logical to assume that more and more people will look for advice in planning their financial activities. Basically, a financial planner is someone who helps a person to manage his or her finance in the optimum manner possible. The financial planner finds out suitable investment avenues for a person based on the person’s attitude towards risk and sources of income. Generally, people with MBAs or with some other degree in finance are considered for the job of financial planning. There are plenty of companies in the financial sector today other than the conventional banking institutions. They offer a variety of financial solutions. For example, one can invest in the stock markets of any country, not just in the one’s own country, through certain funds offered by these new-generation non-banking financial institutions. In such situations, a financial planner is inevitable. Also there are independent financial planners who work as consultants. A financial planner should be well versed in financial and taxation laws and should have a thorough understanding of the intricacies of the financial sector.
Financial planners are one of the highest paid executives in financial sector today. In a single year, there has been an increase of around 25% percent in the salary of financial planning professionals. But the industry is experiencing a brief lull at present because of the sub-prime crisis in United States and the plummeting stock-market indices all over the globe. The average annual salary of a senior financial planner has come down to less than $80000/-. It was around $64000/- a year ago and touched $81000/- in January this year.
In the financial planning sector, there are many posts. Examples are given below (average salaries in United States in entry level are given in brackets): certified financial planner ($59000), personal financial advisor ($46000), financial planner ($47000), associate financial planner ($40000), administrative assistant ($30000), administrative manager ($37000), and executive assistant ($40000). As you can see, the salary varies significantly with the nature of the job. A fresher in the financial planning industry is likely to get a salary of around $37000 to $40000 in United States. Naturally, the salary will increase as the financial panning professional gains experience. The general trend is that there will not be a substantial increase in salary in the first four years. But once the person passes that four year mark and gains some experience, the salary hike shifts to top gear.
However, there has been criticism about the increasing salaries of financial planners. The financial sector has been undergoing a mini crisis in the last few months. But most financial planning executives are still drawing high salary. Some financial columnists are arguing that even at the time of crisis, the bank balance of the financial planners in fattening up, while bank balances of their customers are drying up.
By: Ian Pennington