New Year’s resolutions are notoriously difficult to keep, but if you stick to the following 12 financial resolutions you should end the year wealthier, healthier and wiser:
1. Build a healthy future
New Year’s resolutions to quit smoking, cut out chocolate or party less are not just good for your health – they can be good for your finances as well. But only if you put the savings to good use by investing it for the future. If you trimmed just US$100 a month out of your everyday spending and invested it instead, after 20 years you would have nearly US$47,000, assuming 6 per cent growth after charges.
2. Draw up a financial plan
Everybody should have a financial plan, but too few of us get around to it, says David Hughes, the divisional manager for PIC (Middle East) in Dubai. “Whether you’re starting a family, buying a property, moving country or saving for retirement, the sooner you start planning the better.”
If you haven’t started your pension planning, 2014 is the year to do it, Mr Hughes adds: “Start by working out how much you spend today, then remove the items you won’t need after you stop working. This will show you how much income you need in retirement.”
If you need to take independent financial advice, make a resolution to find a good adviser this year.
3. Shrink your mortgage
Your mortgage is probably your biggest monthly expense, so get the best rate you can. Top deals start at 3.99 per cent for two years and 4.24 per cent for three years, says Warren Philliskirk, the associate director at Mortgage International Business Dubai. “Always check how much you will pay after the initial offer ends. Many banks entice customers with a low introductory rate, only to charge 7 per cent or more when that rate expires. Also check whether there are penalties for switching, some lenders charge as much as 5 per cent of your outstanding balance.”
You can also reduce your mortgage burden by paying down your debt ahead of schedule, say, giving you a cushion for when interest rates finally start rising, Mr Philliskirk adds. “It’s a great way of using your bonus.”
4. Tackle your debts
If you have run up debts, tackle them now before they run out of control. Make a resolution to draw up a monthly budget, curb your wilder spending and pay off your debts, starting with the most expensive first.
If you have several outstanding debts, such as car or personal loans, credit cards and an overdraft, consider rolling them into a consolidation loan, says Ambareen Musa at Souqalmal.com. “That should give you lower, more manageable monthly repayments, but don’t use this as an excuse to run up more debts, or you will just end up in deeper trouble.”
Watch out for hidden fees when refinancing. “You may have to pay a 1 per cent arrangement fee for processing the loan. Some banks also charge early repayment fees of 1 per cent, but others don’t, so shop around,” Mrs Musa says.
5. Get cheaper motor insurance
Do not just extend your car insurance policy at renewal, shop around to see if you can get a cheaper deal elsewhere. Checking the latest rates on a price comparison site could easily save you hundreds of dollars.
You can get a series of quotes within minutes by filling in just one online form, Mrs Musa says. “Your premium will vary according to factors such as the type and value of your car, driving experience, and previous claims.”
Don’t just go for the cheapest policy you find. “Make sure that the policy has everything you need, including extras such as off-road coverage,” she adds.
6. Take out life insurance
If you have a family or other financial dependents, resolve to protect them in case you die, says James Thomas, the regional director at Acuma Wealth Management in Dubai.
You should take life insurance for a minimum of four times your income, preferably a lot more than that, to give your family long-term protection. “Do the sums to work out how much coverage you need to secure your family’s lifestyle well into the future,” Mr Thomas says.
How much you pay for coverage depends on factors such as your age, health, nationality and whether you smoke.
As a rule of thumb, a 40-year old British man would pay about $22 a month for each $100,000 of coverage over a 20-year term, doubling to about $40 if he smoked (another good reason to quit).
7. Get a better credit card
With plenty of credit cards to choose from, make sure you get the best one for you, Mrs Musa says.
“ADIB Etihad Guest Visa Cards gives you guest miles every time you spend on Etihad Airways. ADIB also offers cards with up to 1 per cent cash back on all your retail purchases, and no annual fee for the first year.”
Citibank and Emirates Islamic offer credit cards with Skywards miles, which you can use for free tickets or upgrades.
The Standard Chartered Titanium Credit Card gives cash back on movies, school fees and grocery shopping.
The Citi Life Infinite Visa Credit Card offers a rewards programme, while Citibank World Privileges offers dinning and shopping discounts, and complimentary golf.
8. Boost your pension
If you do not save for your future, nobody will do it for you, says Chris Ferguson, the managing director for the UAE at Guardian Wealth Management. “If your employer will match any contributions you make to its workplace pension, contribute all you can to take full advantage.”
You should supplement this with a regular savings vehicle such as a personal pension plan from an insurance company, Mr Ferguson says.
Ever year you delay is a year wasted. If you invest $500 a month into a pension from age 30, you will have $709,000 in your pot by age 65, assuming 6 per cent a year growth after charges. If you start just one year later, you will have just $663,000, an incredible $46,000 less.
If you leave it five years, you will have just $503,000, an incredible $206,000 less. Your early contributions are most valuable because they have so much longer to grow in value.
9. Switch your savings account
Rates on cash have been dismal for years, so fight back by shopping around for a better rate.
If you don’t need the cash immediately, you can get a high return from a fixed-deposit account. Union National Bank, Citibank, Mashreq and Standard Chartered all offer accounts paying rates of between 3 per cent and 5 per cent, according to Souqalmal.com.
The ADIB Ghina Savings account gives you the chance to win Dh2 million every four months. As your savings grow, so do your chances of winning a prize.
10. Check your currency risk
Currency risk is a challenge for every expat, says Steve Gregory, the managing partner at the financial services company Holborn Assets in Dubai. “Most UAE expats have to juggle several currencies, including their home currency, the currency they are paid in, and the currency of the where they plan to retire.”
If you need to switch money between different currencies, you should take advantage of any sharp shifts in your favour to transfer money.
You also need to decide which currency you want your investment funds to be denominated in. This is most likely to be your country of retirement, although investing in a spread of global funds with exposure to different currencies can reduce risk.
11. Start inheritance planning
Too many people prefer not to think about planning their inheritance, says James Thomas at Acuma. "But if you don't do it, more of your hard-earned wealth could end up in the hands of the taxman, rather than your loved ones."
What counts is your country of domicile, rather than country of residence. “Even though you live in the UAE, you could still face an inheritance tax charge on your worldwide assets back home.”
Consider gifting some of your assets either directly to relatives or through a trust, Mr Thomas says. “This is a complex area and you may need specialist tax advice.”
12. Write your will
There is a simple reason for UAE expats to make a will, says Nita Maru, the founder of inheritance and succession specialists TWS Legal Consultant.
“Where there is no will in place, UAE courts will adhere to Sharia. So if you die intestate, the local courts will distribute your estate in fixed shares according to … Sharia. While this may work for some, it may not be right for many.”
All personal assets, including bank accounts, are frozen until liabilities had been discharged, she says. “A wife who has children will qualify for only one-eighth of the estate and, without a will or estate planning in place, this distribution will be applied automatically.”
Make your will sooner rather than later. “Living and working in the Middle East could turn into a financial disaster in the event of unplanned death,” Ms Maru adds.
business@thenational.ae
The rules on fostering in the UAE
A foster couple or family must:
- be Muslim, Emirati and be residing in the UAE
- not be younger than 25 years old
- not have been convicted of offences or crimes involving moral turpitude
- be free of infectious diseases or psychological and mental disorders
- have the ability to support its members and the foster child financially
- undertake to treat and raise the child in a proper manner and take care of his or her health and well-being
- A single, divorced or widowed Muslim Emirati female, residing in the UAE may apply to foster a child if she is at least 30 years old and able to support the child financially
UPI facts
More than 2.2 million Indian tourists arrived in UAE in 2023
More than 3.5 million Indians reside in UAE
Indian tourists can make purchases in UAE using rupee accounts in India through QR-code-based UPI real-time payment systems
Indian residents in UAE can use their non-resident NRO and NRE accounts held in Indian banks linked to a UAE mobile number for UPI transactions
In numbers: PKK’s money network in Europe
Germany: PKK collectors typically bring in $18 million in cash a year – amount has trebled since 2010
Revolutionary tax: Investigators say about $2 million a year raised from ‘tax collection’ around Marseille
Extortion: Gunman convicted in 2023 of demanding $10,000 from Kurdish businessman in Stockholm
Drug trade: PKK income claimed by Turkish anti-drugs force in 2024 to be as high as $500 million a year
Denmark: PKK one of two terrorist groups along with Iranian separatists ASMLA to raise “two-digit million amounts”
Contributions: Hundreds of euros expected from typical Kurdish families and thousands from business owners
TV channel: Kurdish Roj TV accounts frozen and went bankrupt after Denmark fined it more than $1 million over PKK links in 2013
UAE currency: the story behind the money in your pockets
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Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
A MINECRAFT MOVIE
Director: Jared Hess
Starring: Jack Black, Jennifer Coolidge, Jason Momoa
Rating: 3/5
The specs
Engine: 3.8-litre, twin-turbo V8
Transmission: eight-speed automatic
Power: 582bhp
Torque: 730Nm
Price: Dh649,000
On sale: now
UAE v Gibraltar
What: International friendly
When: 7pm kick off
Where: Rugby Park, Dubai Sports City
Admission: Free
Online: The match will be broadcast live on Dubai Exiles’ Facebook page
UAE squad: Lucas Waddington (Dubai Exiles), Gio Fourie (Exiles), Craig Nutt (Abu Dhabi Harlequins), Phil Brady (Harlequins), Daniel Perry (Dubai Hurricanes), Esekaia Dranibota (Harlequins), Matt Mills (Exiles), Jaen Botes (Exiles), Kristian Stinson (Exiles), Murray Reason (Abu Dhabi Saracens), Dave Knight (Hurricanes), Ross Samson (Jebel Ali Dragons), DuRandt Gerber (Exiles), Saki Naisau (Dragons), Andrew Powell (Hurricanes), Emosi Vacanau (Harlequins), Niko Volavola (Dragons), Matt Richards (Dragons), Luke Stevenson (Harlequins), Josh Ives (Dubai Sports City Eagles), Sean Stevens (Saracens), Thinus Steyn (Exiles)
Results:
CSIL 2-star 145cm One Round with Jump-Off
1. Alice Debany Clero (USA) on Amareusa S 38.83 seconds
2. Anikka Sande (NOR) For Cash 2 39.09
3. Georgia Tame (GBR) Cash Up 39.42
4. Nadia Taryam (UAE) Askaria 3 39.63
5. Miriam Schneider (GER) Fidelius G 47.74
57%20Seconds
%3Cp%3E%3Cstrong%3EDirector%3A%3C%2Fstrong%3E%20Rusty%20Cundieff%0D%3Cbr%3E%3Cstrong%3EStars%3A%20%3C%2Fstrong%3EJosh%20Hutcherson%2C%20Morgan%20Freeman%2C%20Greg%20Germann%2C%20Lovie%20Simone%0D%3Cbr%3E%3Cstrong%3ERating%3A%20%3C%2Fstrong%3E2%2F5%0D%3Cbr%3E%0D%3Cbr%3E%3C%2Fp%3E%0A
Key facilities
- Olympic-size swimming pool with a split bulkhead for multi-use configurations, including water polo and 50m/25m training lanes
- Premier League-standard football pitch
- 400m Olympic running track
- NBA-spec basketball court with auditorium
- 600-seat auditorium
- Spaces for historical and cultural exploration
- An elevated football field that doubles as a helipad
- Specialist robotics and science laboratories
- AR and VR-enabled learning centres
- Disruption Lab and Research Centre for developing entrepreneurial skills
BULKWHIZ PROFILE
Date started: February 2017
Founders: Amira Rashad (CEO), Yusuf Saber (CTO), Mahmoud Sayedahmed (adviser), Reda Bouraoui (adviser)
Based: Dubai, UAE
Sector: E-commerce
Size: 50 employees
Funding: approximately $6m
Investors: Beco Capital, Enabling Future and Wain in the UAE; China's MSA Capital; 500 Startups; Faith Capital and Savour Ventures in Kuwait
The specs
AT4 Ultimate, as tested
Engine: 6.2-litre V8
Power: 420hp
Torque: 623Nm
Transmission: 10-speed automatic
Price: From Dh330,800 (Elevation: Dh236,400; AT4: Dh286,800; Denali: Dh345,800)
On sale: Now
The specs
Engine: Four electric motors, one at each wheel
Power: 579hp
Torque: 859Nm
Transmission: Single-speed automatic
Price: From Dh825,900
On sale: Now
Election pledges on migration
CDU: "Now is the time to control the German borders and enforce strict border rejections"
SPD: "Border closures and blanket rejections at internal borders contradict the spirit of a common area of freedom"
Bio:
Favourite Quote: Prophet Mohammad's quotes There is reward for kindness to every living thing and A good man treats women with honour
Favourite Hobby: Serving poor people
Favourite Book: The Alchemist by Paulo Coelho
Favourite food: Fish and vegetables
Favourite place to visit: London
If you go
The flights
Emirates flies from Dubai to Seattle from Dh5,555 return, including taxes.
The car
Hertz offers compact car rental from about $300 (Dh1,100) per week, including taxes. Emirates Skywards members can earn points on their car hire through Hertz.
The national park
Entry to Mount Rainier National Park costs $30 for one vehicle and passengers for up to seven days. Accommodation can be booked through mtrainierguestservices.com. Prices vary according to season. Rooms at the Holiday Inn Yakima cost from $125 per night, excluding breakfast.
Analysis
Members of Syria's Alawite minority community face threat in their heartland after one of the deadliest days in country’s recent history. Read more
8 traditional Jamaican dishes to try at Kingston 21
- Trench Town Rock: Jamaican-style curry goat served in a pastry basket with a carrot and potato garnish
- Rock Steady Jerk Chicken: chicken marinated for 24 hours and slow-cooked on the grill
- Mento Oxtail: flavoured oxtail stewed for five hours with herbs
- Ackee and salt fish: the national dish of Jamaica makes for a hearty breakfast
- Jamaican porridge: another breakfast favourite, can be made with peanut, cornmeal, banana and plantain
- Jamaican beef patty: a pastry with ground beef filling
- Hellshire Pon di Beach: Fresh fish with pickles
- Out of Many: traditional sweet potato pudding