How to Get Billionaire Benefits, Even If You Don’t Have a Billion Bucks!
It takes money to make money, and the more you have the more negotiating power your money gives you. So, if you have J$100,000 how can you reap billionaire benefits? Simply pool your money with other investors so the volume of funds can purchase assets at reduced prices and give you other billionaire benefits too. Your answer is to invest in a unit trust. Here are some strategies that billionaires employ.
- Minimize Their Fees – Every time you trade individual asset you will pay a fee, so if you trade frequently the fees can negatively impact your profitability. Billionaires minimize their fees in two ways; investing for the long term and negotiating lower fees. Unit trusts help you to reduce your fees in two (2) ways:
a. the volume of funds commands discounts when it purchases assets; and
b. you are not charged for each trade made on your behalf.
Depending on the unit trust you may be charged an annual management fee. However, it is normally less expensive than paying a fee per trade.
- Minimize Their Taxes - If, like billionaires, you love getting tax breaks, unit trusts are another great option. Most assets require that you pay withholding taxes on their earnings whether they are: coupons from bonds, dividends from stocks, and/or rental from property. However, there are some unit trust that are tax free. Two examples of these are JMMB Optimum Capital and JMMB Income and Growth Funds with heavy concentrations of real estate and stocks respectively.
- Diversify Their Portfolio -David Swensen grew Yale University’s university endowment fund from $1 Billion to $23.9 Billion. According to him, “. . . spreading your money across different investments decreases your risk, increases your upside returns over time, and it doesn’t cost you anything.” Unit Trust are already diversified across stocks, real estate as well as J$ and US$ denominated bonds etc. However, if you want even more diversification, you can purchase into several unit trusts since each one is designed to protect you from a different type of risk. For example, JMMB’s Optimum Capital is comprised heavily of real estate because in the long-run real-estate will out-perform inflation. However, JMMB’s Real Value Fund, comprised mainly of US$ denominated bonds, is designed to outperform the depreciation of the J$ dollar.
- A Financial Manager – Missed opportunities can be very costly. Imagine not getting the time to sell a stock before its price plummeted or missing out on a huge profit/capital gains. Thanks to their financial advisors Billionaires are often able to seize windows of opportunity. You can too, if your unit trust is actively managed, as are all JMMB’s unit trusts.
Are you ready to start investing like a billionaire? Then you need to start doing what they do, this include taking immediate action! Please give us a call on 876-998-JMMB/5662. You have nothing to lose and so much to gain!
Written by: Michelle Sinclair-Doyley, Corporate Manager, Group Financial Partnership Support & Financial Education