How to Protect Your Investments in an Unstable National Economy

The U.S. economic downturn of 2008 caused investment losses for many, leaving everyone unsure about economic instability. You may wonder how you can keep your investments safe in an unstable national economy. Educating yourself, seeking unique opportunities, avoiding staying too liquid, employing defensive stocks, keeping selling separate from buying, and considering commodities are several ways to keep your investments safe.

Paper with Financials

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Educate Yourself

Proper education is critical for both the investor’s comfort level and investment success. Just as the housing bubble contributed to the Great Recession of 2008, future bubbles could threaten your investments. Recognizing the characteristics of a bubble could help you get out of risky investments. While there is no one formula for determining whether an industry is in a bubble, businesses with small revenues with large market caps should cause concern. Understand that industry bubbles have large-scale impacts on the entire economy.

Understanding other economic indicators is helpful for proper investment selection. Fisher Investments supports investor education. Their YouTube videos about investing outlooks and education offer insight on ways to make the best financial decisions.

Seek Unique Investing Opportunities

Everyone knows that diversifying your investments is a great way to protect them from volatility. However, are you considering unique opportunities? Peer-to-peer lending is unique and can provide an additional investment strategy to keep you protected during an unstable economy. These loans are higher risk because they involve unsecured loans to individuals, but the lending platforms generally bundle loans to decrease the risk of failure. Depending on the loan you choose and your risk level, these can have attractive returns.

Invest for Your Timeline

Your response to economic instability should relate directly to where you are in your investment timeline. If you are close to retirement, you are investing conservatively to protect your assets. However, if you are early in your investing, economic instability should have less bearing on your longterm goals as the ups and downs will level out over time. Continue to exercise caution in an unstable economy but be comfortable taking risks as long as you are comfortable with losing that investment. In a long-term investing strategy, you have time to recuperate any losses from risky investments.

Avoid Staying Too Liquid

In an unstable economy, keeping cash on hand might be tempting. While it is good to keep some cash, too much cash prevents you from enjoying market returns. In an unstable economy, increase cash but do so modestly. This allows for a balance between having a safety net and benefitting from market growth.

Stacks of Money

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Employ Defensive Stocks

Defensive stocks are from sectors that stay consistent despite the economy. Examples of sectors with defensive stocks include healthcare, food companies, utilities, and consumer staples. If another economic downturn occurs, these stocks continue to offer growth. The downside is that these lower risk stocks offer less lucrative returns. Use a diversity model consistent with your investing goals when adding defensive stocks.

Keep Selling Separate from Buying

While common practice tells you to always buy more stocks when you sell, this is not always the best move in an unstable economy. By sticking to the rule that you should only sell when you have something else you want to buy, you may miss opportunities to sell your stocks at their best price. Instead, when your stock hits its target price, sell. You will have other opportunities to buy stocks that align best with your investing goals.

Consider Commodities

Commodities are a possible option for keeping your investments protected. If an unstable economy begins to drive up inflation, people will still need to purchase commodities. A diverse portfolio with commodities allows you to capitalize on this. Because commodities present greater risk, buy according to your investment goals.

There is no foolproof plan for keeping your investments safe during an unstable economy. Incorporate these tips into your investments so that they align with your level of risk and comfort. These steps can lead you towards a better-protected portfolio. What are some other ways to protect your investments in a shaky economy?

Keeping your finances in check over the festive period

Christmas is a time for giving, but it’s easy to let your inner Saint Nick get out of control. If you suffer from an excess of altruism, there are some easy ways to keep your spending under control this festive season.

Plan presents early

Avoiding the last-minute rush for presents is a good start. With consumer confidence rising, retailers aren’t rushing to discount goods – but many have been attempting to encourage early spends with offers and if revenue keeps rising, the discounts may disappear. Planning early also prevents those impulse buys that quickly add up – there’s a reason Santa asks for lists!

Plan meals sensibly

It’s a genuine joy to have a turkey with all the trimmings, but it’s costly and wasteful to throw away your leftovers. Instead of winging it with the turkey, use the wealth of recipes available online, as well as label advice, to get the portions just right. Any leftover turkey can be used in a delicious curry or casserole, which you could even freeze for future use if you need a bit of a detox first. 

Track your spending

If you have credit cards, set one aside specifically for your Christmas spend. That way, you can keep an eye on exactly where the money’s going. There are also several smartphone apps that help store and organise your spending - Expensify, for example, is a handy free app available from both the Apple App store and Google play that allows you to track designated expenses and even stores pictures of receipts.

Choose your financing wisely

When planning a Christmas splurge, many people turn to solutions like ‘Christmas Clubs’ to save ahead of time. However, since these don’t offer interest, it usually represents better value to save or invest your cash as normal. If you need a boost closer to Christmas, find a credit card or loan offering 0% purchase plans or interest free periods to spread payments.

Make use of offers

Cashback deals represent a great way to build small returns (usually between 0.5% and 2%) on your credit card spend, while certain reward schemes give goods and services that could be just the Christmas gift you needed. For supermarket shops, cards like the American Express Nectar Credit Card (representative 25% APR variable) can be a valuable boon if you’re hosting a big Christmas dinner. Of course, in order to really benefit from these you’ll need to pay the bill at the end of the month, otherwise interest payments will negate your gains. Usually, your card application will involve tests that can confirm that your limit corresponds with your spending power, keeping your budget under control.

This post  was brought to you by Eden Smith, a professional business analyst from London.

How to Choose a Company to Help You Sell Your Structured Settlement

Selling your belongings generally isn’t all that complicated until you get into the world of real estate. Selling a car doesn’t generally require any expert advice. Selling unneeded items usually only means having a garage sale. However, things get a bit stickier when you move into the world of financial products, and that includes your structured settlement. There are a lot of things that you need to know about selling a settlement, and the industry can be more than a little murky for those who aren’t sure of their direction. A seller services company can help, but you need to choose the right provider.

Length of Time in the Industry

The structured settlement sales industry is relatively new, but that doesn’t mean you have to work with a company that has no verifiable history. Make sure the company you’re dealing with has a long history (dating back to 2007 or so). Not only does having a verifiable history prove that the company has been around, but it proves that they’re doing what it takes to stay in business.

Your Advocate, Not the Buyer’s

One thing you’ll notice when you start looking to sell your structured settlement is that a number of companies exist to serve buyers, not sellers. That’s certainly not in your best interests. Working with a buyer’s company does nothing to ensure that you get the most money possible for your settlement sale, and there’s the chance that you’ll be taken advantage of by an unscrupulous company. Make sure you work with a company that serves sellers, not buyers. You want an advocate on your side, not someone working for a buyer.

How Much Do You Get?

Understand that selling your structured settlement will not give you access to all of the money you have coming to you. Buyers don’t work that way. The difference between the total value of your structured settlement and the offer you accept is called a discount (it’s the profit that makes buying these settlements worthwhile for a company). However, there’s no reason that you have to accept a mere pittance. Working with a reputable seller services company will ensure that you offer the lowest discount possible (thus, maximizing the amount of your lump sum payment).

Partial Sales Welcome

You don’t have to sell your entire settlement. You can sell as little or as much of the total amount as you like. A reputable seller services company will explain that to you upfront in an attempt to help you make the wisest possible decision regarding your sale and your financial future. For some, selling the entire amount makes the most sense, but for others, selling only a portion and keeping the remainder in reserve is the better decision.

As you can see, working with a reputable seller services company to help you sell your structured settlement is vital. With the brief tips listed above, you should be able to make an informed decision for yourself.