For the first 30 or so years of working, saving and investing, you’ll be first in the mode of getting out of the hole (paying down debt), and then building your net worth (that’s wealth accumulation.). But don’t forget, wealth accumulation isn’t the ultimate goal. Decumulation is! (a separate category here at the Hub).
By Billy and Akaisha Kaderli, RetireEarlyLifestyle.com
Special to Financial Independence Hub
Once someone learns that we retired at the age of 38 in 1991 and have been traveling the world ever since, they ask, “How could you afford such a lifestyle? It must cost a fortune for airfare, to live in guesthouses, hotels, apartments and eating out!”
When we tell them that this lifestyle hasn’t cost us anything — in fact, we made money — they’re floored. Remember, it’s a lifestyle, not a vacation.
When we left the conventional working world in January, 1991, the S&P 500 Index was 312.49. Today it is over 5300. That’s an average of roughly a 10% per year return including dividends. See the calculator below.
Sure, we had expenses, but our net worth has outpaced both spending and inflation because we created a money machine.
The cost of not retiring
Whenever we’re considering a trip, we ask ourselves, “Can we afford it?” Our answer shocks some: “We can’t afford not to go.”
We’re no spring chickens at 72. We’ve experienced enough in life to know that we will be more disappointed if we don’t try new things than if we make mistakes at the ones we attempt. We’re only getting one shot at this life, and find that our travel list is getting longer, not shorter.
Over the years many of our friends have passed on: some who never got a chance to retire from their jobs, and they had plenty of money. For the last 3 decades we have been spending about $30,000 per year. We have mentioned a few times about loosening the purse strings and this is what we have done.
We have seen dozens of countries, stayed in resort hotels, purchased new computer equipment and digital toys, refreshed our wardrobes countless times, drank fine wine, had maids, gardeners, and ate at some of the most fashionable restaurants in the world. We have hiked, biked, and scuba’d, lived on tropical islands and in million dollar homes, lived with the Maya, met musicians and magicians and generally enlarged our perspective about the world.
After all this traveling, spending and inflation, our net worth is still higher than when we retired.
Business finances are important for any company to pay attention to, but perhaps more so for small- and medium-sized enterprises (SMEs) given their limited capital and their need to make the most out of every single buck.
Errors or miscalculations in an SME’s financial records can potentially lead to disastrous consequences, such as an untimely shortage of funds, inefficient business decisions due to wrong financial forecasts, and — if worse comes to worst — a state of being in the red.
One of the best safeguards against troubles like these is a full financial audit. To that end, here is a quick guide on what financial audits entail, why they’re a must for your small business, and how to prepare for one.
Accounting vs. Auditing
To rookie entrepreneurs who are just getting a handle on their business finances, accounting and auditing may seem like the same thing: and the latter may even seem unnecessary. However, these processes actually serve different purposes.
While accounting is concerned with the regular record-keeping of a business’s financial transactions, auditing is a less frequent procedure meant to check if those records are indeed accurate and error-free. In addition, given that a financial auditor is typically an independent party, their services are invaluable for providing an unbiased look into a business’s finances and giving an entrepreneur a more objective appraisal of their company’s financial standing.
What are the Benefits of a Full Financial Audit?
To those who know the process better, getting a full financial audit yields multiple benefits for small businesses. One is that it helps spot any inconsistencies or errors made during the bookkeeping and accounting process. As mentioned above, identifying and correcting those mistakes are crucial for ensuring that an entrepreneur is basing their business decisions on accurate data.
Having an audited financial statement on hand can be helpful when dealing with various financial institutions, such as some business banking Philippines providers, just in case they happen to need exhaustive documentation about the business’s financial standing. If you’re exploring a banking solution like the Philippines’ Maya Business Deposit or financing through Maya Flexi Loan, it would be a good idea to complete a full financial audit of your SME first.
A financial audit can also be beneficial for cost-cutting measures, as the process will allow you to identify areas where you might be overspending and pinpoint expenses to be streamlined.
Lastly, having your business audited will make it easier for you to spot fraudulent activities from bad actors in your company. That means that you’ll also have better chances of neutralizing them quickly and, overall, improve the integrity of your financial processes.
In turn, this could elevate the reputation and credibility of your business: especially among potential investors, as they can be assured that you’re constantly on top of your finances.
Tips for Overseeing a Smooth Audit
Philippine businesses whose gross annual sales have reached or exceeded a sum of PHP 3 million are required by the Bureau of Internal Revenue (BIR) to submit an audited financial statement (AFS) every year. If your small business happens to meet that threshold, then you’ll need to work with a third-party auditor to conduct a financial audit on your business for full compliance with the country’s laws.
To make sure that the auditing process goes smoothly, have all the pertinent records prepared beforehand. Include your ledgers, financial statements, tax-related documents, and other accounting records. You can lessen the burden of collating all these documents by ensuring that your day-to-day record-keeping is transparent and organized, so that there won’t be a need for a last-minute scramble to locate what’s necessary. Continue Reading…
It’s been two years since Elon Musk acquired the former Twitter, now X. That led to a steady Xodus (sorry!) of hundreds of thousands or millions of formerly loyal users to new platforms like Mastodon and, the following summer, Facebook’s Threads.
Since last week’s shocking re-election of Donald Trump, another wave of X users has left for bluer pastures, this time for BlueSky, founded in part by former X co-creator Jack Dorsey, and some venture capitalists.
There is also a surge of Xpatriates moving to the decentralized Mastodon service. Mastodon creator Eugen Rochko posted Friday on Mastodon that it has benefited from the Xodus as well. Official “app downloads are up 47% on IOS and 17% on Android.” Sign-ups are up roughly 27% compared to the previous month, with 90,000 new accounts.
Thus far, though, Bluesky has drawn more media attention this week. Bluesky has been around since 2021 but had a slow start, beginning with an “invitation-only” approach to big names or those with massive followings. It is now wide open and free to all comers.
But the floodgates have really opened since last week’s election and Musk’s infiltration of the new Trump 2.0 administration. A million new users flocked to BlueSky in the last week alone, bringing the total user base to 15 million, according to Time. I am one of them, joining on Remembrance Day.
Truth to tell, (certainly not Truth Social!) I had NOT planned to join BlueSky, as I am already on Mastodon, Threads and — oh yeah — Linked In and Facebook. Since I have not yet left X, I felt 5 or 6 social media platforms was probably two or three too many. Even so, some contacts at X the past week suggested I try Bluesky as well, saying the new rush of sign-ups was reminiscent of the good old days of early Twitter.
So, somewhat reluctantly, I signed up, using the same handle as on most of my other accounts: @JonChevreau. I guess part of my reasoning was that when it comes to handles it’s a bit of a land grab and I didn’t want someone else posing as me at BlueSky. That appears to have happened to Mad Money’s Jim Cramer.
Now I’d be the first to say it’s ridiculous to be active on half a dozen social media accounts. It would be nearly impossible for someone with a full-time job and long commute but as I am semi-retired and work from home, it is (barely) manageable. Like most journalists, I’m a bit of a news junkie, though my focus is primarily financial (hence this website) and secondarily, politics (on the theory that politics is always going to impact our personal Financial Independence).
Social media splitting into Red and Blue Silos
Many journalists on X have been agonizing about staying there as standards have slipped under Musk and the site is rife with misinformation, most of it right of centre. In fact at Mastodon, we generally refer to X as “the Hell site.” I see broadcaster Don Lemon just announced his departure from X and arrival on Bluesky.
The problem is of course that many of us have spent the better part of 10 or 15 years building a large network of followers on X. In my case, I restrict most of my X posts to financial content, if only to promote the latest blog from this site. To the extent site sponsors like to see their guest blogs on the site promoted as much as possible on various social media, it’s hard to make the break. It takes years to build up a following in the tens of thousands.
But between Musk buying X and now joining the incoming Trump administration, the die seems to have been inevitably cast. Social media has fragmented into political siloes. X is now a Trump propaganda machine that amplifies what Trump’s own Truth Social was doing. It’s in effect Pravda for the incoming Republican White House. Call it the Red Silo. That was likely the main reason Lemon finally departed.
What you might call the “Resistance” is Threads, BlueSky and to a lesser extent Mastodon, which together I think of as the “Blue Silo.” But in addition to departures from X, I’m also seeing lots of Threads users moving this week to Bluesky: some abandoning it altogether and others opting to become “dual citizens.” One frustration I have myself with Threads is the current limit of following no more than 7500 people. Because of the still-common practice of “reciprocal following,” that policy also curtails Follower growth to a similar number.
Let me go through my evolving personal strategy for navigating these sites. I’ll list these in the order in which I tend to use them first thing in the morning and periodically throughout the day and often evening.
1.) Mastodon
This is my first port of call, even though my Follower account there after two years is less than 10% of what it is on X. Mastodon seems to me to be a bit of a Blue (i.e. U.S. Democrat) silo, as are the next two sites I’ll list: Threads and Bluesky. Presumably many liberal Canadians are sympathetic to that political orientation although things could change soon.
Why do I give Mastodon priority? For several reasons. First, it’s NOT owned by a single billionaire who can upset the apple cart and change the rules on some arbitrary whim. As I explained in a similar post to today’s when I joined Mastodon two years ago — Life After Twitter — unlike the centralized Twitter platform (or indeed Threads or Bluesky), Mastodon is decentralized.
That’s the first thing you need to know about it when signing on. First you have to pick a server, which is run by volunteers around the world. I often get pushback from people checking out alternatives who are under the impression Mastodon is too technical.
It’s not really: all these platforms behave in a similar way, albeit with subtle differences. The main stumbling block with Mastodon is picking the “instance,” which is another word for server. I picked one of the few (or only?) Canadian ones: mstdn.ca. It’s also called Mastodon Canada and bills itself as being run by Canadians for Canadians. Note too that Mastodon is spelt with the letter o in two places, NOT the letter “a”!
The other big reason I prefer Mastodon is that unlike the billionaire-owned centralized platforms, Mastodon does not use an “algorithm” to steer content in your direction. X, Threads and BlueSky all do this to some extent: either they explicitly ask you what kind of content you want or they gradually infer what you want from the content you appear to gravitate to. Down the road, the danger is they will monetize all this for advertisers or other purposes. When they’re free, remember that YOU are the product! Continue Reading…
In this episode of Two Way Traffic wealth management advisor Darren Coleman — who specializes in cross-border financial issues — discussed IT security with his namesake, Darren Coleman. Darren is founder of Coleman Technologies Inc., which handles IT managed services and cyber services. The latter Coleman – he’s been called Canada’s top IT expert – leads a team of technicians based in Langley, BC and Dallas, Texas. He says hacking is a trillion-dollar industry and business owners should take note.
Podcast host Coleman drew parallels between financial services and cybersecurity. He said he looks for gaps in a client’s financial plan, while in cybersecurity Coleman the IT expert looks for gaps or vulnerabilities in multi-factor authentication, threat protection to ensure business resilience, and endpoint protection (cybersecurity software that protects from viruses, malware and ransomware).
The two agreed what’s necessary in both their industries is prevention and managing risk. Another point is that Canada and the US have different tax regimes, and different laws for regulatory compliance.
“The U.S. government can gain access to your data if they want it,” said IT expert Coleman. “We believe the Canadian government can’t, but there are ways they can get it too.”
Their discussion explored …
Why clients of wealth management firms are good targets for hackers and what to do in a security breach when asked to pay a ransom.
How multi-factor authentication can prevent 99% of email breaches.
Why organizations devote too much security attention to senior management and not enough to everyone else.
Darren Coleman of Raymond James [Darren Coleman or Darren #1 henceforth]
Welcome back to another edition of Two Way Traffic, the cross-border podcast. Today my guest is now, let me see if I pronounced your name correctly. Darren Coleman.
Darren Coleman of Coleman Technologies [Darren C #2 henceforth]
You got it.
Darren Coleman
So you and I are namesakes. You run a firm in Langley, BC called Coleman technologies and do outsourced IT infrastructure. You are a cybersecurity expert. Why don’t you take us through Coleman technologies.
Darren C #2
I am the founder and CEO. Part of my mission is to help protect a million people from hackers, so being here on your podcast supports that cause. I’ve shared my cybersecurity insights on ABC, Forbes, MSB Success Magazine. I’ve spoken at Harvard, and co-authored some books. So that stuff led my company down the road to be an expert within the cybersecurity realm. But more than that, we provide 24/7, direct-detect, flat fee, IT support to our clients. We really just become your IT department.
Are there off-the-shelf tools?
Darren Coleman
Our firm has a huge IT spend every year, but for a lot of medium and small businesses, can they not just get all the tools off the shelf?
Darren C #2
Not really. You can hire an IT professional, but you’re probably going to hire multiple people because they’re going to want to take holidays. You’re going to be looking at double the cost right there. But you can’t just buy antivirus. Antivirus isn’t good enough anymore. You need endpoint protection, threat hunting, content filtering, and audits. There are things the IT professional may be good at, but there are things you need an expert for. If you’re looking for cybersecurity insurance, the forms are 10 or 12 pages long and require things you might not think about. Continue Reading…
Donald Trump is poised once again to become the president of the United States, becoming only the second president to be reelected after leaving the White House. The last time this happened Grover Cleveland was celebrating his second stint as president from 1893 to 1897.
Two world wars, a Great Depression, and 23 presidents later, it’s safe to say the world looks very different.
Cleveland’s second stint in office began with a decline in the New York stock market in what was known as the ‘Panic of 1893’. Fast forward over 130 years and the U.S. election is still closely linked to the performance of the U.S. stock market. Only this time we’re talking tariffs, tech companies, and cryptocurrencies.
What does Trump’s Victory mean for the U.S. Stock Market?
The general consensus is that Donald Trump’s victory will be good for businesses and the U.S. stock market. If the immediate reaction on the 6th of November is anything to go by, this would be true. Many U.S. shares hit record highs and the S&P surged by around 2.5% as investors bet on Trump’s pro-business policies.
At the heart of this initial boom were companies that stand to benefit from Trump’s hard-hitting tariffs that are to be imposed on international imports. Take the Elon Musk-owned Tesla for example. The world’s richest man acted as the President’s mouthpiece in the run-up to the election, and it’s easy to see why.
Not only do Trump’s policies favor high-net-worth individuals, but his threatened 60% tax on Chinese imports would essentially burden the competition to American-owned businesses. Tesla’s share price subsequently rose to a yearly high as news of Trump’s win filtered in.
On the flip side, Trump’s tariffs might not be good news for all American stocks. Large tech corporations rely heavily on Chinese imports. Increased costs could impact the share price of the “Magnificent Seven” stocks while also seeing the consumer pick up the cost through higher prices for electronic goods.
What does the Trump Victory mean for the Global Stock Market?
Generally speaking, if a Trump victory is good for the U..S economy, it’s good for major global corporations that export to the U.S. Initial optimism across the rest of the world mirrored that in the U.S. However, unlike the U.S., the euphoria was dying out by Wednesday as investors realized the implications of the tariffs mentioned above and what they could mean for international trade.
While China has been threatened with the strictest of Trump’s tariffs, a 10% tax on all U.S. imports would impact Europe too. Take the U.K. for example. Rolls-Royce is one of the world’s biggest manufacturers of aircraft engines and heavily exports to the U.S. While companies like this may benefit from an upswing in the American economy, this could be wiped out by increasing taxes.
This view would line up with performance too. Rolls-Royce Holdings initially rose as the news of a Trump victory filtered in before sharply declining to pre-election prices as investors possibly started to consider the future of international trade.
What does the Trump Victory mean for Cryptocurrencies?
Today, it’s becoming increasingly common for investors to look beyond traditional stock markets when it comes to investing. One of the most common alternatives, and a big talking point throughout the election campaign, is Bitcoin and other cryptocurrencies. Trump was seen as the pro-crypto option, publicly stating his positive view on crypto and even previously being involved in the promotion of NFTs. Continue Reading…
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