It’s a brand New Year, and as is tradition, many persons make New Year resolutions to start saving, investing, develop healthier eating habits, more exercise and the list can go on and on. We are already in March, have you started any of your New Year resolutions yet, more importantly your investing resolution?
There is currently a lot happening around us locally, regionally and internationally. We are still in the Covid-19 pandemic, although it’s being stated that we are entering the endemic phase of the virus; the Russia/Ukraine situation and continuous rising costs driving up inflation. The effect of rising inflation impacts your purchasing power and disposable income. The inflation rate as at December 2020 was 0.60% and December 2021 was 3.50%. Source: Central Bank of Trinidad & Tobago. With rising inflation and interest rates also set to increase during the course of this year, there is no better time than now to start making your money work for you!
To get you motivated to start your investment journey this year, there are a few investment vehicles available through local investment firms that can be used to achieve this first step.
Some of these are Non-Discretionary and Discretionary accounts. These accounts provide the flexibility to own investments in different asset classes, such as bonds- corporate and sovereign, stocks- local and international, commercial paper, mutual funds etc., with the potential to create a diversified portfolio. Today, we will focus on the Non-Discretionary Account.
What is a Non-Discretionary Account?
Simply put, a Non-Discretionary account as the name suggests, gives you the client, full autonomy in the selection of investments for your portfolio. This type of account is most suited for individuals who are knowledgeable with the different types of investments. An example, you may be interested in stocks; the investment firm will facilitate and execute this purchase for you and vice versa if you require the sale of these stocks thereafter. It therefore takes away the hassle of having to deal with an arbitrary broker company, as there would be a developing or established relationship with your Wealth Manager, who can also provide advice. The same applies to other types of investments that you may want to invest in, such as bonds, trade receivables and structured products to name a few.
Investing through a Non-Discretionary account will help in bolstering the performance of your overall investment portfolio, as well as help in mitigating the effects of rising inflation.
To learn more and obtain further details on investing via a Non-Discretionary Account, feel free to contact one of our Wealth Creators.