I want to get my finances in order. This means paying off my credit card debts and saving and investing more efficiently. At 30, I spend too heavily, save too little and invest nothing. What's the best strategy to kick-start my new financial outlook? BW, Dubai
Expert: Steve Cronin, founder of Wise (wiseuae.com), a non-profit organisation to help expats invest their own wealth
If you have a regular income, then this challenge is entirely mental: to increase saving and spending discipline, resist temptation, learn a bit about personal finance and avoid investing in bear traps. Here’s how to go about it:
• Mental attitude
Aim to think positively (fin-ancial freedom) rather than negatively (this will be tough on my social life), focusing on the future benefits. They will come sooner than you think if you get your credit card debt paid off. Enlist support and accountability from others. Practise saying no to expensive events, clothes etc. Accept that some people will not appreciate your new outlook. Make lifestyle changes gradual and sustainable – there is no need to be a hermit.
• Spending
You have to fix your spending patterns and pay off your credit card debt before thinking about saving and investing. Force yourself to go through your recent credit card statements and understand what categories you are spending on the most. Tackle the big items first – do you really need that health club membership? Check for things that add up over the month, like dinners and shopping. If spending is a bit out of control, set yourself a monthly budget for social events, clothes, food etc. Immediately write down everything you spend over Dh200 – it might make you think twice. There are also some great mobile apps for tracking budgets.
• Credit card management
Credit card debt has a very high interest rate, which can make it balloon fast if not paid off. Dh1,000 on a card charging 3 per cent a month becomes Dh1,426 after a year, with interest on interest. If you have multiple cards, always pay off the card with the highest interest rate first. If you can’t pay off the complete debt within three months or so, consider asking your bank to convert the debt to a loan, which will have a much lower interest rate. A consolidation loan can cover the debt from multiple cards. For your new monthly card spending, make sure you pay it off fully before the due date to avoid late fees and expanding debt. Set aside 10 to 20 per cent of your salary as soon as it comes in, using it to pay off your card debt or loan.
• Cash buffer
Once you have paid off your debt, you can focus on saving. As a general rule, pay off any debt with annual interest above 5 per cent before saving, as it’s not guaranteed your investments will make more than this every year. Place 10 to 20 per cent of your salary in a separate savings account (with as high a rate as possible). Create a cash buffer of at least three months, factoring in all your expenses, including rent.
• Investments
Once you have saved around US$5,000 to $10,000 on top of your cash buffer, open an investment account with an offshore broker like TDDI (Luxembourg), Interactive Brokers (US), Saxo Bank (Dubai) or SwissQuote (Dubai). Invest monthly or quarterly in passive index tracker ETFs and try to look at your account as little as possible – at most once per quarter. A good mix for an average 30-year-old would be 80 per cent international stocks (eg HSBC HMWO or Vanguard VWRD) and 20 per cent bonds (eg iShares SDIG or IGLO). Finally, don’t invest in a long-term savings plan or life insurance policy with a savings component. The high hidden fees will slow your savings growth and you won’t be able to take the money out if you need it.
Next question:
How is commission paid to financial advisers on a long-term savings plan. Can you break it down for me? I have a 25-year plan and want to understand exactly how an adviser is paid and how that money is clawed back from the policy? SU, Dubai
Every three weeks The National features a reader's personal finance problem. If you have an issue or want to suggest a solution for another reader's concern, write to pf@thenational.ae.
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Maestro
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FIGHT CARD
1. Featherweight 66kg
Ben Lucas (AUS) v Ibrahim Kendil (EGY)
2. Lightweight 70kg
Mohammed Kareem Aljnan (SYR) v Alphonse Besala (CMR)
3. Welterweight 77kg
Marcos Costa (BRA) v Abdelhakim Wahid (MAR)
4. Lightweight 70kg
Omar Ramadan (EGY) v Abdimitalipov Atabek (KGZ)
5. Featherweight 66kg
Ahmed Al Darmaki (UAE) v Kagimu Kigga (UGA)
6. Catchweight 85kg
Ibrahim El Sawi (EGY) v Iuri Fraga (BRA)
7. Featherweight 66kg
Yousef Al Husani (UAE) v Mohamed Allam (EGY)
8. Catchweight 73kg
Mostafa Radi (PAL) v Abdipatta Abdizhali (KGZ)
9. Featherweight 66kg
Jaures Dea (CMR) v Andre Pinheiro (BRA)
10. Catchweight 90kg
Tarek Suleiman (SYR) v Juscelino Ferreira (BRA)
Brief scoreline:
Crystal Palace 2
Milivojevic 76' (pen), Van Aanholt 88'
Huddersfield Town 0
Email sent to Uber team from chief executive Dara Khosrowshahi
From: Dara
To: Team@
Date: March 25, 2019 at 11:45pm PT
Subj: Accelerating in the Middle East
Five years ago, Uber launched in the Middle East. It was the start of an incredible journey, with millions of riders and drivers finding new ways to move and work in a dynamic region that’s become so important to Uber. Now Pakistan is one of our fastest-growing markets in the world, women are driving with Uber across Saudi Arabia, and we chose Cairo to launch our first Uber Bus product late last year.
Today we are taking the next step in this journey—well, it’s more like a leap, and a big one: in a few minutes, we’ll announce that we’ve agreed to acquire Careem. Importantly, we intend to operate Careem independently, under the leadership of co-founder and current CEO Mudassir Sheikha. I’ve gotten to know both co-founders, Mudassir and Magnus Olsson, and what they have built is truly extraordinary. They are first-class entrepreneurs who share our platform vision and, like us, have launched a wide range of products—from digital payments to food delivery—to serve consumers.
I expect many of you will ask how we arrived at this structure, meaning allowing Careem to maintain an independent brand and operate separately. After careful consideration, we decided that this framework has the advantage of letting us build new products and try new ideas across not one, but two, strong brands, with strong operators within each. Over time, by integrating parts of our networks, we can operate more efficiently, achieve even lower wait times, expand new products like high-capacity vehicles and payments, and quicken the already remarkable pace of innovation in the region.
This acquisition is subject to regulatory approval in various countries, which we don’t expect before Q1 2020. Until then, nothing changes. And since both companies will continue to largely operate separately after the acquisition, very little will change in either teams’ day-to-day operations post-close. Today’s news is a testament to the incredible business our team has worked so hard to build.
It’s a great day for the Middle East, for the region’s thriving tech sector, for Careem, and for Uber.
Uber on,
Dara
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
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Cricket World Cup League 2
UAE squad
Rahul Chopra (captain), Aayan Afzal Khan, Ali Naseer, Aryansh Sharma, Basil Hameed, Dhruv Parashar, Junaid Siddique, Muhammad Farooq, Muhammad Jawadullah, Muhammad Waseem, Omid Rahman, Rahul Bhatia, Tanish Suri, Vishnu Sukumaran, Vriitya Aravind
Fixtures
Friday, November 1 – Oman v UAE
Sunday, November 3 – UAE v Netherlands
Thursday, November 7 – UAE v Oman
Saturday, November 9 – Netherlands v UAE
How to watch Ireland v Pakistan in UAE
When: The one-off Test starts on Friday, May 11
What time: Each day’s play is scheduled to start at 2pm UAE time.
TV: The match will be broadcast on OSN Sports Cricket HD. Subscribers to the channel can also stream the action live on OSN Play.
Pupils in Abu Dhabi are learning the importance of being active, eating well and leading a healthy lifestyle now and throughout adulthood, thanks to a newly launched programme 'Healthy Lifestyle'.
As part of the Healthy Lifestyle programme, specially trained coaches from City Football Schools, along with Healthpoint physicians have visited schools throughout Abu Dhabi to give fun and interactive lessons on working out regularly, making the right food choices, getting enough sleep and staying hydrated, just like their favourite footballers.
Organised by Manchester City FC and Healthpoint, Manchester City FC’s regional healthcare partner and part of Mubadala’s healthcare network, the ‘Healthy Lifestyle’ programme will visit 15 schools, meeting around 1,000 youngsters over the next five months.
Designed to give pupils all the information they need to improve their diet and fitness habits at home, at school and as they grow up, coaches from City Football Schools will work alongside teachers to lead the youngsters through a series of fun, creative and educational classes as well as activities, including playing football and other games.
Dr Mai Ahmed Al Jaber, head of public health at Healthpoint, said: “The programme has different aspects - diet, exercise, sleep and mental well-being. By having a focus on each of those and delivering information in a way that children can absorb easily it can help to address childhood obesity."
If you go
Flights
Emirates flies from Dubai to Phnom Penh with a stop in Yangon from Dh3,075, and Etihad flies from Abu Dhabi to Phnom Penh with its partner Bangkok Airlines from Dh2,763. These trips take about nine hours each and both include taxes. From there, a road transfer takes at least four hours; airlines including KC Airlines (www.kcairlines.com) offer quick connecting flights from Phnom Penh to Sihanoukville from about $100 (Dh367) return including taxes. Air Asia, Malindo Air and Malaysian Airlines fly direct from Kuala Lumpur to Sihanoukville from $54 each way. Next year, direct flights are due to launch between Bangkok and Sihanoukville, which will cut the journey time by a third.
The stay
Rooms at Alila Villas Koh Russey (www.alilahotels.com/ kohrussey) cost from $385 per night including taxes.
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FORSPOKEN
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