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December 23rd, 2015

UTC New Year


Recommitting to your financial success in the year ahead

Part 1 of a 2-part series on aligning lifestyle goals and financial planning/investment.

As we approach the end of 2015 more people will begin making their New Year’s resolutions. Popular choices for resolutions often include commitments to improve one’s health, family life and spiritual well-being, but we forget to include another important aspect of our lives: our finances. Committing to financial planning and investment can help you to achieve your future lifestyle goals and a year free from financial uncertainty. 

“Financial peace isn’t the acquisition of stuff. It’s learning to live on less than you make, so you can have money to invest,” says American financial author Dave Ramsey. But that doesn’t mean you’ll have to give up on everything you love. With some careful planning, you’ll still be able to play mas when February comes around!

Chipping down the road to good financial health

You’ll need to take a moment before the New Year rolls in to assess your financial position. Do an analysis on your current financial state. Are you spending too much? Keep in mind that you should be aiming to invest at least 10% of your net salary (after taxes and deductions) each month.

Here are a few questions you can ask yourself to ensure your finances are in order.

  1. Do you always pay the rent/mortgage and utility bills on time?
  2. Do you keep three months net income in reserve for emergencies?
  3. Is the return on your investments ahead of inflation?

Chances are, if you answered yes to all of the above, you probably have an established monthly budget. Budgeting teaches you discipline which is an important step in achieving financial success. A simple budget could be an outline of how your income is divided between savings, different categories of expenditure and debt repayment.

A good way to determine how much money ends up going into the different categories of your budget is to firstly track your expenses over a period of time. You’ll gain a very accurate picture on how much you usually spend on food, entertainment, transportation and other areas which may vary from month to month. You can then make an informed decision on imposing spending caps in the various categories.

Set financial goals to achieve a sound financial future

With any good plan, you’ll need to determine what you hope to achieve at the end of it. For your financial plan this comes in the form of setting financial goals. This stage of the process is perhaps the most crucial and the most exciting as it allows you to envision the ideal lifestyle you’ll like in a few months or years.

Goals can be both short and long term and can include anything from paying a down payment on your first home to purchasing your costume from your favourite Carnival band. It’s important to know what you want your money to be able to do for you in order to know how much you’ll need to invest. You also need to determine the practicality of your goals, and outline their investment horizons.

Time is a crucial factor when it comes to successful investing. Our TT$ and US$ Income Funds offer interest rates which are compounded daily, allowing investors to earn interest on the accumulated interest thus making your deposit grow at a faster rate. Postponing investments in mutual funds like these can mean missing out on higher future returns – i.e. the income received on your investment. In other words, the shorter the investment horizons for your goals, the less they’ll benefit from compounding.

Getting your finances in order for 2K16 and beyond!

For any investor, the key to investing is to ensure that yourportfolio is well diversifiedandmutual funds are a great way of doing just that.

Diversifying your assets allows you to limit your risks by reducing the effect of a possible decline in the value of one asset or security. That way, if one asset class or security underperforms the others can help to offset any impact.

All investments come with risks but as an investor you can take steps to limit those risks. What’s risk? It’s the chance of loss on the capital you have invested. Remember, however, that the likelihood of loss can be lessened through diversifying the assets or securities you invest in.

This is in line with the UTC’s investment strategy for value creation for our unit holders. We are the only collective investment scheme provider that is mandated by UTC Act to never exceed more than 10 percent holding in any one issuer. This means that our investment strategy is not one that allows for high levels of concentration.

We therefore manage risk in a way that ensures that investors have the best opportunity for consistent, competitive returns, aiming to give you financial peace of mind when you investat the UTC.

Our $US Income Fund is no exception, aiming for capital preservation for unit holders whilegiving them easy access to their money. The fund is made up of a range of government, corporate and money market instruments, providing investors with a diversified portfolio in which to invest.

A new financial outlook forthe New Year!

The path to successful investing takes time, serious study of investment options and the economic environment, disciplined effort and, most importantly, patience. Our professional portfolio managers can help investors achieve their financial objectives by sticking to our goal of value creation.


  • Keep spending under control so you’ll have money to invest in the New Year.
  • Make a plan! Set financial goals as a way of determining what you hope to spend your money on.
  • Diversify your investments. This is a good way of limiting the associated risks.