Schroders arrived in Bermuda in 1969 when an investment management subsidiary was created to focus primarily on the institutional and private wealth growthunder a very robust legal framework that had English common law at its historical heart. The local business quickly established itself expanding into international trust work with a focus on private equity, and subsequently private equity administration. 

Worldwide Schroders was going from strength to strength as the Schroder family, in its sixth generation of involvement since its formation in 1804, remained closely involved with the business in all areas. The Schroder family, led by its then current patriarch – Bruno Schroder, was very involved with the Bermuda operation having fallen in love with the island.

In 2000 Schroders decided to re-focus its global business and sold its investment banking arm to Salomon Smith Barney, part of Citigroup.  While this affected most Schroder business around the world, the investment hub in Bermuda continued to thrive.  Private wealth management was introduced providing those local clients with an international feel with a service that drew upon the worldwide expertise of the group. By this time Schroders was operating in more than 30 countries across the globe with a fabulous brand that was fast approaching its 200^th year birthday.  This was celebrated in 2004 with the Schroder family visiting every office across the now significant empire to remind all of the value of not just the family name – but also the importance of taking a long term view.

Now as a global investment and private wealth manager, we help institutions, intermediaries and individuals meet their goals, fulfil their ambitions, and prepare for the future. But as the world changes, so do our clients’ needs. That’s why we have a long history of adapting to suit the times and keeping our focus on what matters most to our clients.

Doing this takes experience and expertise. We bring together people and data to spot the trends that will shape the future, providing us with a unique perspective which allows us to always invest with conviction. We are responsible today for $536.7 billion of assets for our clients who trust us to deliver sustainable returns. We remain determined to build future prosperity for them, and for all of society. Today, we have 5,000 people across six continents who focus on doing just this.

We are a global business that’s managed locally. This allows us to always keep our clients’ needs at the heart of everything we do. For over 200 years and more than seven generations, we’ve grown and developed our expertise in tandem with our clients’ needs and interests. Explore our interactive timeline to see how we’ve been shaping financial futures since our very beginnings.

Our current business in Bermuda continues to reflect all of the values mentioned above, enshrined in our drive for excellence, integrity, innovation, teamwork and passion in all that we do for clients. Our employees all continue to recognise the importance of taking a long term view – at the heart of all family relationships. Further, all also know that it is a privilege, particularly in today’s fast moving and short term thinking world, to be able to look to the long term. Schroders is proud to have been in Bermuda for 50 years.

Article by: RG Business in conjunction with Schroders (Bermuda) Limited

www.schroders.com 

This article was originally posted in the May 2019 edition of the RG Business Magazine.

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by Jessica Maiato

Coming from a small loving home with hard-working parents, we never heard of the words “Life Insurance”. What is Life Insurance? How would it benefit my family and me? Do I really need another bill right now?

Life Insurance is an uncomfortable topic because it usually involves thinking about an unpleasant worst-case scenario, living through the death of an extremely close loved one; therefore, many people just avoid the subject altogether. When I search the meaning of “Life Insurance”, it says “Insurance that pays out a sum of money either on the death of the insured person or after a set period.” What does that really mean to a family that is working pay check to pay check in Bermuda? “Another company that wants my “hard” earned money.” “Another scam”, were the exact words that I received from someone I spoke with last week.

You have no idea when you will need insurance, which is why it is essential to plan ahead. The day you die your income stops, however, your family will still have to pay rent or a mortgage, groceries, cell phone, cable, and electricity bills, etc. Purchasing a policy at a young age is the way to go. The younger you are, the less expensive your premiums will be.

There are two main factors in determining the cost of life insurance. The first one is the applicant’s age. As you age, it becomes more likely and more imminent that an insurance company will need to pay beneficiaries, resulting in higher premiums for those that purchase a policy in later years. To mitigate that risk, insurance companies will charge higher premiums for older first-time applicants. If you are a 20-something, you are more likely to be single and childless, but that doesn’t mean you will stay that way. You may decide to settle down, and at that point, the appeal of life insurance may become clearer. The downside, however, is that by waiting to buy, you will be facing higher premiums. As a general rule life insurance for young adults is less expensive.

What types of Life Insurance do you need? In terms of options, life insurance for young adults generally falls into two categories: Term and Permanent Life Insurance.

Term Insurance is inexpensive and is used for temporary needs. It has a lower initial cost, but the premium will increase when it’s time for renewal. This kind of policy pays a death benefit to your beneficiaries if you pass away before the term expires. The greatest benefit of a Term policy is that you have the option to convert it to a Permanent Policy after a specific of length time.

A Permanent Policy is very common. It offers a death benefit along with guaranteed cash values. If you pick this type of life insurance policy, you are agreeing to pay a certain amount in premiums on a regular basis for a specific death benefit. The savings element will grow based on dividends the company pays to you.

The question is, how can you afford Life insurance? Let me give you a practical solution, take me, for example: for the price of daily breakfast, I can cover my entire family with Life Insurance. Like many of us I like to have coffee at one of our local coffee shops each morning, so think of it this way: For a Vanilla Latte and a toasted bagel, I could easily spend $11.00 a day.

Now multiply the price of that coffee and bagel by five for the days of the work week and then by four weeks in a month, and just for that Vanilla Latte and toasted bagel I have spent $220.00 per month on something that can be toasted at home and brewed at work for free (thanks to our generous employers!). Therefore, at the age of 30, with that $55.00 per week, a Term Life Insurance policy for 20 years for coverage of $1.3 million can be offered.

Which simply means, God forbid, should something happen to me within the next 20 years, my family will receive $1.3 million dollars, which could cover expenses including my funeral expenses, remaining balance on our mortgage, my son’s school and college fees, replace my salary for a few years and still have something to start a new life without me. This is especially important for parents of young children or adults who would find it difficult to sustain their standard of living if they no longer had access to the income provided by their partner.

Today, we see technology ruling families, and their pockets as every kid wants the latest iPhone and not really thinking about what that thousand dollars for the iPhone X can cover if an unexpected death was to happen. A Life Insurance Policy can be designed to cover the cost of your funeral or cremation expenses when you die. Bermudians are no different than citizens of countries all over the world and fail to realise that funerals can cost upwards of several thousand dollars.  This failure to plan ahead and prepare for such an eventuality can sometimes lead to financial hardship on families or loved ones who must cover the costs.

We don’t know when we’ll pass away. It could be today, tomorrow or 50 years from now, but it is one of the few certainties we face, it will happen eventually. Life is uncertain, and life insurance can be an essential element of a sound financial plan. Buy what you can afford, and buy it as early as possible, but only after receiving proper and professional advice.

I would like to leave you with a short poem that I believe will hit home for many Bermudians:

“Because he loved me,

He did the dishes,

Rubbed my feet,

Surprised me with tulips,

Took me to musicals even though he didn’t like them,

Carried my bags while I did the shopping,

Held my hand.

He died of cancer four years ago.

Because he loved me,

I can stay in our home.

I can be here for our children,

I can afford to pay for their college education.

I can worry about the other things in life besides money. He still loves me. And he still shows it.

Life Insurance. You do it for love.”

Jessica Maiato is a Life Insurance Sales Agent at Freisenbruch-Meyer.  She is a talented sales professional who builds loyalty and long term relationships with her customers.

This article was originally published in the February 2019 edition of the RG Business Magazine.

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KPMG’s Budget snapshot provides highlights across Bermuda’s national debt, revenues and expenditures, payroll taxes and other taxes, new incentives, and economic substance. They also provide the firm’s points of view on these components of the Budget.

For the full document, click here. 

The post A Snapshot of the Bermuda Budget 2019/20. You’re Welcome! appeared first on RG Magazines.

The “Just Good Business” campaign (http://www.goodbusiness.bm/) highlights efforts underway by the government, responsible authorities, and Bermuda-based international and local businesses to ensure the island meets the highest standards for anti-money-laundering (AML) and anti-terrorist-financing (ATF).

The campaign is supported by the National Anti-Money Laundering Committee (NAMLC), Bermuda Monetary Authority (BMA), and Bermuda Business Development Agency (BDA), along with numerous major industry groups. These include: the Association of Bermuda International Companies (ABIC), the Association of Bermuda Insurers & Reinsurers (ABIR), the Bermuda Bankers Association (BBA), the Bermuda International Long Term Insurers & Reinsurers (BILTIR), Bermuda Insurance Management Association (BIMA), Bermuda Chamber of Commerce, and the Bermuda Stock Exchange (BSX).

As well as educating on the importance of AML/ATF measures—such as filling out “Know Your Customer” (KYC) documentation at banks and other paperwork—the campaign is also a call to action: individuals and organisations are encouraged to find out what their legal obligations are and to report suspicious financial activity. Authorities depend on this information, known as “suspicious activity reports,” or “SARS.”

How do you recognise suspicious activity? Here are some signs:

• If you work in a money service business and a customer makes regular transactions by cash to different recipients
• If your customer doesn’t know the recipient or purpose of their transaction or only wants to see a particular “friendly” teller/employee
• If you work in property/car insurance and a customer cancels insurance and seeks a cheque as reimbursement after paying in cash
• If you work in the travel industry and a client pays for high-price tickets last minute and in cash

To file a SAR, in confidence, please contact the Financial Intelligence Agency (FIA) at 441/292-3422 or https://www.fia.bm.

This article was featured in the May 2018, RG Business Magazine.

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Your early years (infancy, living with your parents, schooling)
Your working years (making money, looking after a family)
Your retirement years (spending money)

But what a lot of people don’t think about is that the second part – your working years which has to financially fund two-thirds of your life, i.e. your working years and retirement years.
With the Pension Act only coming into effect in 2000, this has given people a mere 18 years of compulsory pension savings, which would lead to the conclusion that many people probably don’t have enough money in their pension to retire on.
The simplest way to build extra money for retirement is through voluntary contributions in your pension plan.
The most important step is to confirm if your company pension plan allows its employees to make additional contributions into the plan. If your company’s pension plan does allow this, then you really should consider choosing this method for saving additional funds for retirement.
The second most important step is to create a budget to ensure you can comfortably afford to shift some of those dollars currently being deposited into your bank account into your pension plan instead.
Think “new year, new budget”, and the easiest and most effective way is with a simple budget spreadsheet: creating a budget with a template will help you take control of your finances and determine how much money can be redirected straight from your paycheque to your pension account instead of your bank account.
Once you have crunched your numbers, determine how much you think you can have additionally taken off your paycheque and put directly into your pension plan. Perhaps it’s only an additional one per cent per month deducted from your paycheque until you are comfortable with a higher amount being redirected into your pension plan.

I personally started with an additional two per cent per month, and whenever I was given a cost of living pay rise, I would increase my pension contributions by that percentage – ALWAYS PAYING MYSELF FIRST. Would I have preferred to keep the additional money from the pay increase instead of directing it into my pension? Yes! But I also recognised that, for myself, my pension will be the majority of my retirement income and I need to be dedicated to the cause.

The great thing about voluntary pension contributions is they are NOT locked in, so if an emergency does arise, you can access those funds without too much trouble. In addition, you can stop and start voluntary contributions whenever you want – so if something comes up and you find things are too tight, stop the voluntary contributions for a few months until things are back on track and then simply start up again.
The third step is to ensure your investment selection for your company pension plan matches your needs: it’s about your investment goals, your investment time horizon, and most importantly, your tolerance to risk.
Considering your time horizon is essential; at what point on your life timeline do you plan on retiring? It could be early retirement starting at age 55, standard retirement at age 65, or even later. It sounds like an easy question, but without an answer, you are not creating an end game and it makes planning for retirement even harder. I plan to retire at age 60, which means I have 18 plus years until I retire; however, I need to make sure what I have at retirement can provide me with 25-plus years of retirement income. The longer your time horizon, the better equipped you are to ride out any market fluctuations and benefit from compounding interest on the investments, and the more time you will have to save more money.
Once you have figured out your time horizon, you must think about how it relates to investment risk – the simple question is: How much risk are you willing to bear for the potential investment reward, and if that investment goes pear-shaped, how much time do you have to recover?

The greater the risk, the greater the potential for a higher reward, similarly, the lower the risk, the greater the potential for a lower reward. If you are closing in on retirement, then taking a lot of risk would not make sense as you don’t have the time to recover from investment fluctuations.

However, if you are 15, 20, 25-plus years away from retirement, then taking more risk for the long-term growth potential would make sense as you have time to recover from any investment downturns.
Putting extra money away in your pension gives you more potential to grow your retirement savings faster and the ability to diversify into investments that may not be available outside of a pension plan.
At the end of the day, whether you earn $50,000 or $150,000 per year, making sure you can dedicate a little more to your pension can only help you in the long term and provide you with the retirement that you deserve.

Carla Seely is the Vice President of Pension and Investments at Freisenbruch-Meyer. If you would like any further details, please contact her at [email protected] or call 297 8686.

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