Latest news with #financial stability
Yahoo
4 days ago
- Business
- Yahoo
7 Ways You Can Still Go Broke While Earning a High Salary
When you scroll through the job market, you typically aren't looking for the best places to make friends, but rather where you will make the most money. Your earning potential post-graduation and pre-retirement is largely dependent on your career path and years of experience, but also on how you manage your finances. Find Out: For You: High salaries are often linked with financial stability and wealth accumulation that allow you to easily pay off your student loans and credit card debt while still having enough left over to invest and live comfortably. However, earning a high salary doesn't automatically shield you from financial woes or even having to file for bankruptcy. Unfortunately, there are several ways you can find yourself struggling financially, even after years of raking in a substantial income. Here are the pitfalls that can lead to financial instability despite a high salary. You Mismanage Your Money The cornerstone of financial stability is effective money management and the ability to develop good spending habits. High earners often fall into the trap of poor budgeting, or don't bother tracking their spending to see where they are hemorrhaging cash needlessly. Without a clear understanding of where their money is going, they may end up spending more than they earn, leading to a gradual erosion of their bank accounts, emergency funds and more. If you feel like you need some help in this area, you can get a fresh start by seeking out the help and guidance of a financial advisor. Investing, saving and retirement planning can be complex, and high earners are not always equipped to manage their finances effectively. Not seeking professional advice can lead to missed opportunities in investments, tax planning and wealth management, resulting in less-than-optimal financial growth or even losses. Up Next: Lifestyle Inflation Creeps In A common issue for high earners is lifestyle inflation, where their spending increases with their income instead of living beneath their means to save. This might include buying a more expensive home or car or indulging in luxury vacations. This is not to say you can't treat yourself with what you've earned. However, though these expenses may seem manageable on a high salary, they create a financial burden that can be unsustainable in the long run, especially if the income level changes. If you accrue a lot of debt with high interest rates and then suffer a job loss, you may have to seek out a bankruptcy lawyer sooner than you would think. Lifestyle inflation is also often a direct consequence of keeping up with the Joneses. High earners are frequently subjected to social peer pressures that can lead to unwise financial decisions. This includes keeping up appearances, engaging in expensive activities or purchasing luxury items impulsively. Such behaviors can lead to significant financial drains. Unlike planned luxury spending, which can be accommodated within a budget, impulse purchases and constantly giving in to social expectations can create a pattern of spending that outpaces even a high income. You Don't Save or Invest Nearly Enough for the Future Despite a high income, you might ignore the importance of saving and investing, or think you can just start doing that more later. Failing to set aside a portion of your income for the future in a high-yield savings account or emergency fund can lead people to go bankrupt should they suffer a financial shock. You Neglect Retirement Planning A high salary can create a false sense of security, leading some to neglect saving for retirement. Without adequate savings and investments earmarked for retirement, you could have to work well past the age of 65. It's never too soon to start investing in 401(k) plans, IRAs or other retirement accounts. You Can't Dig Your Way Out of Debt High earners are not immune to debt, and in some cases, their high income can lead to overconfidence in borrowing or spending. If you think the gravy train will never run out and you are swiping your credit card like there is no tomorrow, you could be in for a rude awakening financially. Significant amounts of debt, such as credit cards, car loans or a substantial mortgage can lead to high-interest debt and repayment obligations that quickly become a money pit from which you can't escape. You Have Inadequate Insurance Insurance is often overlooked as a crucial part of financial planning. If you make a lot of money, that doesn't mean you aren't susceptible to life's uncertainties such as a medical emergency or natural disaster. Without proper insurance coverage, you could find yourself facing hefty bills due to health issues, accidents or property damage, which can rapidly deplete your finances. You Ignore the Tax Man One critical aspect that high earners often overlook is the management of their tax obligations. If the IRS can bring down Al Capone, than even a higher income won't protect you if you don't pay your taxes properly. Remember, with a higher income, the tax liability also increases, sometimes significantly. Failure to plan for taxes or to understand the nuances of tax laws can lead to hefty dues and penalties. This negligence can erode wealth quickly, as a substantial portion of income may go toward settling unexpected tax bills, rather than being saved or invested. Final Take To GO The bottom line is that a high salary is not a guaranteed safeguard against financial instability. It requires prudent financial management, planning and an awareness of the potential pitfalls. The economy can be unpredictable, and high-paying jobs are not always secure. Economic downturns, job loss, industry shifts, medical expenses or company downsizing can lead to unexpected loss of income. High earners without a financial safety net can find themselves in a precarious position very quickly so make sure you plan for the worst while making the most. More From GOBankingRates Mark Cuban Warns of 'Red Rural Recession' -- 4 States That Could Get Hit Hard 6 Popular SUVs That Aren't Worth the Cost -- and 6 Affordable Alternatives Mark Cuban Tells Americans To Stock Up on Consumables as Trump's Tariffs Hit -- Here's What To Buy This article originally appeared on 7 Ways You Can Still Go Broke While Earning a High Salary Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Reuters
4 days ago
- Business
- Reuters
Croatia's Fortenova seals a 550 mln euro refinancing deal with Unicredit, Zagrebacka bank
July 25 (Reuters) - Croatia's largest food producer and retailer, Fortenova Grupa, has agreed a 550 million euro ($645 million) refinancing deal with Unicredit and Zagrebacka Bank ( opens new tab, the company said on Friday. "With this arrangement, which represents the largest private corporate financing in Republic of Croatia arranged by one banking group, Fortenova Group makes an important step in further stabilisation and strengthening of its financial position," the company said. Formerly known as Agrokor, Fortenova is one of the biggest companies in southeastern Europe. It was saved from bankruptcy in a restructuring deal with local and foreign creditors in mid-2018. The company said this was its first banking financing since it was founded in 2019. "Since ... 2019 we have cut gross debt from 2 billion euros to 650 million euros and at the same time more than doubled the Group's EBIDTA," said CEO Fabris Perusko. The effective date for the debt refinancing is October 1. ($1 = 0.8526 euros)
Yahoo
7 days ago
- Business
- Yahoo
I just won $120K from a lawsuit. I need a car and to pay off $5K in debt — how do I make the most of the rest?
It's not every day you suddenly come into a large sum of money and figuring out what to do with it smartly can feel overwhelming. Still, it can happen: some of us might one day receive a sizable payout from a lottery, inheritance or legal settlement. Imagine this scenario: You've just won a lawsuit and after taxes and lawyer fees, you're expecting about $120,000 as payout. You have $5,000 in debt you want to clear and you need to buy a car for work since you don't currently own one and it would simplify and reduce your commute. You also have a stable job with a decent income, but no real savings or investments because of past financial missteps. How can you make the rest of that money go as far as possible? While $120,000 is a meaningful amount of money, it can disappear fast if you're not careful, deliberate and strategic with your spending. Here's how to make sure that one-time payout sets you up for lasting financial stability. If you don't keep a budget, now would be a good time to start one. Don't miss Thanks to Jeff Bezos, you can now become a landlord for as little as $100 — and no, you don't have to deal with tenants or fix freezers. Here's how I'm 49 years old and have nothing saved for retirement — what should I do? Don't panic. Here are 6 of the easiest ways you can catch up (and fast) Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan 'works every single time' to kill debt, get rich in America — and that 'anyone' can do it Immediate next steps Paying off any debt should be one of your first priorities and with $120,000, that $5,000 balance can be addressed easily. Once you pay off that amount, you instantly free up funds you would've had to spend on monthly interest payments. If you don't have an emergency savings fund, that becomes priority number two. Put away at least three to six months' worth of expenses into an accessible, high-yield savings account for any unexpected costs. Let's say this amount comes to $25,000, leaving you with $90,000. Once you pay off the debt and set up an emergency fund, it's time to think about a vehicle purchase. While that settlement money makes the price of a shiny new car seem affordable, remember that the costs don't end at the sticker. Cars lose value quickly and things like insurance premiums and property tax bills will add up. Consider a reliable used vehicle that can combine longevity, efficiency and low maintenance costs. Certified pre-owned models, for instance, can give you the feeling of 'new' while lowering your cost and coming with an extended warranty. Begin investing After paying off your $5,000 debt, padding your emergency savings at $25,000 and buying a nice, reliable $25,000 used car, you've got $65,000 left from your winnings. It may be time to start investing, thinking about tax-advantaged accounts. A Clever Real Estate survey found that 40% of respondents said they'd blow through a $10,000 windfall without saving any of it and nearly 84% said they'd make unnecessary purchases to 'treat' themselves. It's best to get that settlement money into a spot where it's safe from any temptation to spend recklessly. Read more: Americans are 'revenge saving' to survive — but millions only get a measly 1% on their savings. You may not be able to easily access it, but investing will allow you to reap compound interest over time. Consider a diversified index fund or ETF portfolio that can spread your money — and risk — across multiple stocks or an index. Since you may be investing tens of thousands of dollars, consider speaking to a financial advisor to help you make the best investment decisions for your particular situation. You may also want to set aside some of that cash for a Roth IRA to bump up your retirement savings. Note that you can invest up to $7,000 a year tax-free, or $8,000 for those 50 and older. And now that you're really doing some financial planning, consider setting a budget for at least the next year or two. Determine your monthly expenses and bills before you add any of the award money; more often than not, the best way to approach a large windfall is to act like you don't have it. It's okay to have a little fun While it's usually best to put most of that money somewhere you can 'set it and forget it,' don't be afraid to budget a small one-time expense for yourself if your priorities allow. That could mean saving for a concert, vacation or upgrading your technology — whatever adds a little joy without derailing your plans. You may also want to consider spending on whatever provides a solid return-on-investment. For example, as Warren Buffet said, 'The best investment by far is anything that develops yourself, and it's not taxed at all.' So, while it's not traditional investment advice, you may want to spend any 'fun money' on expanding your knowledge, skillset or self-improvement. The bottom line is that by the end you should still have a solid chunk of your award money left to serve as a financial cushion or to help you jumpstart future goals. What to read next Robert Kiyosaki warns of 'massive unemployment' in the US due to the 'biggest change' in history — and says this 1 group of 'smart' Americans will get hit extra hard. Are you one of them? How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you'll need a substantial stash of savings in retirement Rich, young Americans are ditching the stormy stock market — here are the alternative assets they're banking on instead Here are 5 'must have' items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you? Stay in the know. Join 200,000+ readers and get the best of Moneywise sent straight to your inbox every week for free. This article provides information only and should not be construed as advice. It is provided without warranty of any kind. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Daily Mail
22-07-2025
- Business
- Daily Mail
Bank of England Governor Andrew Bailey hits back at Rachel Reeves over regulation
Andrew Bailey yesterday put himself at odds with Rachel Reeves over the Chancellor's outspoken attack on regulation. The Bank of England Governor made clear that he did not share Reeves' recent claim that the enforcement of red tape acted as a 'boot on the neck' of business. Speaking to MPs on the Treasury select committee, he urged caution over a proposed shake-up of the ring-fencing system that separates traditional lending and deposit-taking from riskier investment banking. The comments appear to be a shot across the bows of the Chancellor as she seeks to unravel some of the reforms put in place during the financial crisis in a bid to boost growth. They suggest she may face an unwanted battle with Threadneedle Street to add to friction with Labour backbenchers over spending cuts and the battle to balance the books, amid dismal economic growth and deteriorating public finances. Reeves took aim at regulators during her Mansion House speech to the City earlier this month. Cautious: Andrew Bailey (pictured) made clear he did not share Rachel Reeves's claim that the enforcement of red tape acted as a 'boot on the neck' of business But Bailey chose to dissociate himself from the 'boot on the neck' comments. He said: 'It's not a term I'd use. 'I think there are areas that we clearly should look at it – we've announced a whole range of things we're doing, and that's a good thing. But we can't compromise on basic financial stability and that would be my overall message.' Reeves has also promised 'meaningful reform' of the ring-fencing regime – something being demanded by the bosses of a number of major banks who say they are a drag on business. But Bailey said he favoured keeping the rules. He told MPs: 'I do think that the ring-fencing regime is an important part of the structure of the banking system.' Bailey said the rules make it easier to deal with banks that get into trouble in a way that spares consumers, businesses and households. He added: 'I'm sure there are things that can be improved and we will work constructively to get through that process. 'I think it has established itself as part of the system and to me it would not be sensible to take it away at this point.' Asked how he would respond if the Treasury seemed to be going 'too far' in stripping back regulation, Bailey said he and Bank officials would 'start by making our views very clear'.
Telegraph
22-07-2025
- Business
- Telegraph
Andrew Bailey warns Rachel Reeves against bonfire of red tape
Andrew Bailey has warned Rachel Reeves against slashing red tape to boost growth, cautioning that looser regulation will increase the risk of a crisis. The Bank of England Governor was asked by MPs on Tuesday if he agreed with the Chancellor's recent claim that regulation is 'the boot on the neck' of business. 'I do not use those terms,' he said. 'There are areas where we clearly should look at [revising regulations]. But we cannot compromise on basic financial stability, that would be my overall message.' His comments come a week after Ms Reeves announced a roll-back of regulation in the City in an effort to boost growth. The Chancellor used her Mansion House speech to urge financiers to ditch their 'excessive caution' and called for regulators covering industries beyond the City to loosen the rules to aid the economy. Mr Bailey hailed the opportunity to ditch EU red tape that was not designed to suit Britain's market, but said Ms Reeves should be wary of going too far. He told the Treasury select committee: 'When I hear people say, 'The financial crisis is now way in the past, we've got passed that, that's all solved, that's all out of the way, move on' ... For those of us who were veterans of sorting the problems of that out, I think we probably all feel in some ways ... erm ... no. 'Yes of course the world moves on ... [But] we had a very serious recession in this country after [the financial crisis]. So I do react to people who say that.' He added: 'Success in financial stability is when nothing happens. The fact we've had market volatility this year and we haven't had a financial stability problem and we're not worrying about banks failing ... is of course a success. 'It's not always easy to point to it and say, look, this is good news. But the UK banking system is very resilient.' Relaxing ring-fencing rules Mr Bailey specifically warned Ms Reeves against relaxing so-called ring-fencing rules, which divide retail banking from the racier world of investment banking. The Chancellor last week announced the ring-fencing regime would be 'reformed' as part of her overhaul. She has instructed the economic secretary to the Treasury to review the policies, 'looking at how changes can strike the right balance between growth and stability'. However, Mr Bailey said: 'The ring-fencing regime is an important part of the structure of the banking system. 'It makes resolution of banks, if they get into trouble, much easier, and it benefits, particularly in terms of UK customers and UK consumers, businesses and households. That is a helpful feature of it, I don't think it hinders banks fundamentally. 'It has established itself as part of the system and to me it would not be sensible to take it away at this point.' Risks are growing in financial markets, the Governor added, with heavy government borrowing in the UK and around the world driving up debt interest costs. High prices in stock markets also pose dangers, he said. He sounded the alarm over American tech stocks, singling out the soaring valuation of chip company Nvidia as a sign of the extent of market enthusiasm. 'In the US, it is a very strong tech-led growth story. The market capitalisation of Nvidia is now larger than the UK's GDP,' said the Governor. 'It is up 20pc this year. That is a pretty striking fact. It is 7pc of the overall market capitalisation in the US.' While Mr Bailey warned Ms Reeves not to go too far on City reforms, he said allowing banks to make more loans worth over four and a half times the income of homebuyers could help tens of thousands first time buyers onto the property ladder. He urged more banks to apply for permission to dish out larger mortgages. He said: 'It is very simple. We have changed the policy overnight. All you need to do is send us an email, ask for what we call a modification by waiver, it is yours.' The Governor said one bank has already obtained that permission, with another going through the process.
