7 financial sharks to protect your money from
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- Category: SME toolkit
- Written by with Bridget Olotu
- Hits: 1406
It is not enough to make much money, it is also important to protect your money legally from financial sharks. The world is full of people who are only looking for an opportunity to prey on the rich.
As you aim to improve your financial life, you must also be prepared to protect your estate from coming under attack by financial sharks. Michael Jackson, Mike Tyson, Sylvester Stallone, Whitney Houston, et al, are good examples of wealthy people who suffered mercilessly in the hands of different financial sharks. Why do you have to watch it? Nigeria is gradually becoming very sophisticated and our hitherto traditional society is wearing a modern look with the attendant consequences of having more conmen or women, swindlers, fraudsters and litigants stalking our towns and cities looking for unwary fat pockets to empty.
Let me also say that even some attempts to fleece money off you might even be legal, for instance through excessive taxation. If you live in Lagos, you’ll discover that the tax regime of the state government is vigorous and functional. And the Federal Government is also working frantically to improve its tax system as a way of generating more revenue for government expenditure. As an entrepreneur and/or investor, you therefore need to arm yourself with the requisite knowledge to protect your wealth or money from being bungled from people or organisations we think are on our side and are standing behind us.
The 8 financial sharks we should keep an open eye on are as follows:
1. Bureaucrats.
I am never against taxes and will never be. Taxes are an expense for living in a civilised society. Nigeria is just beginning to reposition its tax system and give teeth to legislation against tax evasion. This is a step in the right direction. What I am against, and entrepreneurs and investors have to watch this, is excessive taxation. Our state and federal governments in a bid to increase their income generation drive are coming up with tax regimes that may result in cold comfort for business activities.
Therefore, smart organisations should employ accountants who are knowledgeable about our tax system or they should work directly with tax consultants or professionals to enjoy certain provisions in our tax system not open to the “uninitiated” and to protect their businesses from predatory taxation. Also, people should, aside having earned income, also begin to grow their passive and portfolio income. The taxes on these types of income are less.
2. Bankers.
Bankers are supposed to protect your money and that is what they do. But recent events have confirmed the fears of people that banks and mutual fund institutions can also turn out to be financial sharks preying on the monies entrusted in their care. The case of Bernard Madoff and Allen Stanford still remain clear examples of a breach of trust between the investing public and financial institutions.
Can you imagine how many billions of dollars were lost to Madoff’s Ponzi scheme? Can you imagine how many people committed suicide as a result of their investments lost in that large-scale fraud? The last interview he gave in the prison few weeks ago, Madoff remarked that he never knew the fraud would last that long.
Therefore when you bank your money, peel your eyes and make sure your life savings are safe. Thank God for the bank consolidation in Nigeria. But you as an investor have to be very careful with your money. We have to watch these retirement fund providers, pension scheme programmes, fund managers and investment bankers, and even bank charges!
3. Brokers.
A broker is another word for a salesperson or agent. In the world of money, there are brokers for stocks, bonds, real estate, mortgages, insurance, businesses, etc. One of the problems today is that most people are getting their financial advice from salespeople, not rich people. Warren Buffett had this to say to that effect, “Wall Street is the place people drive to in their Rolls-Royce to take advice from people who ride the subway (train).”
As Robert’s Rich Dad put it, “The reason they are called brokers is because they are broker than you are.” While I do not discountenance the fact that we need brokers and that there are very good brokers around, finding the good ones is a difficult task. This is because good brokers are busy working with their higher net worth clients. So watch the broker you have. They can make you sink or swim financially!
4. Businesses.
All businesses have something to sell. The question we should ask ourselves is, “Is this business’s product or service making me richer or poorer?” “Is it making me healthier or a better person?” Some people buy products that make them poorer or sicklier. They patronise companies whose products or services push them further into debt.
When what you do is borrow to buy a product that does not put money in your pocket and spend years paying for that product, then you’re not being financially intelligent. Robert Kiyosaki says, “I like spending money on products or services that make me richer.” What about you?
5. Brides and Bridegrooms.
We all know that some people marry for money. Both men and women marry for money rather than love. Like it or not, money plays an important role in marriage. But some people are attracted to men and women and marry them, not because they love them, but because they love their money.
Examples abound all over the world like in America where a 50% divorce rate is prevalent leading to frequent divorces and 50% asset-sharing between spouses. While we may not be facing this type of problem in Nigeria or Africa yet because of our patrifocal social structure, there is and can be a mild damage done to anyone’s finances when your spouse is in the relationship for pecuniary reasons. So watch out for love predators as a young man, woman or rich person.
6. Brothers-in-law.
Death is the final exit. It is another time when financial sharks appear. If you are rich, not having financial intelligence can be very expensive. Michael Jackson was saved the embarrassment when initially they thought he had died intestate (without a will) only to discover that he had one prepared for him in 2002. Family, friends and the government show up at funerals when the deceased individual is rich.
Your fourth cousins, distant uncles, aunts, etc, and people you’ve never met, suddenly become family and come to cry at the funeral. If you have financial intelligence, the percentage of your money these grieving relatives receive will be controlled by you, even after you have moved on. Those with a high financial intelligence have wills, trusts, and other legal means of protecting their wealth and final wishes from death predators.
7. Barristers.
Do you know somebody once sued MacDonald’s claiming the coffee was too hot? That is an example of a financial predator. And you know what, lawyers are ready and will be willing to defend such financial predators? Millions of people are waiting for any excuse to use a lawsuit to get rich. There are lawyers whose sole purpose in life is to take you to court and take your money.
Knowing these financial sharks or predators are lurking in the shadows waiting for an opportune time to pounce on you, should make you do the following:
1. Keep nothing of value in your name. Don’t have your houses or properties in your name rather in your company’ name.
2. Buy personal liability insurance immediately. People in this part of the world toy with insurance. You need to also insure your assets.
3. Hold assets of value in legal entities like limited liability or public limited liability companies and limited liability partnerships. There are also bad legal entities such as sole proprietorships and general partnerships. Ironically, most small business owners are bad legal entities.
As you can see, protecting your money is not an option but a must for you. There are financial sharks prowling everywhere looking for whom to pounce on. When I started these write-ups, I have also had encounters with some of them calling and emailing me with phoney businesses and offerings that are laid with jagged traps.
God will save us. But we have a part to play in protecting ourselves from these sharks so we can live respectable lives and leave our families in comfort when we exit this earth.
Articles
7 financial sharks to protect your money from
Category: SME toolkit Written by with Bridget Olotu Hits: 1406
It is not enough to make much money, it is also important to protect your money legally from financial sharks. The world is full of people who are only looking for an opportunity to prey on the rich.
As you aim to improve your financial life, you must also be prepared to protect your estate from coming under attack by financial sharks. Michael Jackson, Mike Tyson, Sylvester Stallone, Whitney Houston, et al, are good examples of wealthy people who suffered mercilessly in the hands of different financial sharks. Why do you have to watch it? Nigeria is gradually becoming very sophisticated and our hitherto traditional society is wearing a modern look with the attendant consequences of having more conmen or women, swindlers, fraudsters and litigants stalking our towns and cities looking for unwary fat pockets to empty.
Let me also say that even some attempts to fleece money off you might even be legal, for instance through excessive taxation. If you live in Lagos, you’ll discover that the tax regime of the state government is vigorous and functional. And the Federal Government is also working frantically to improve its tax system as a way of generating more revenue for government expenditure. As an entrepreneur and/or investor, you therefore need to arm yourself with the requisite knowledge to protect your wealth or money from being bungled from people or organisations we think are on our side and are standing behind us.
The 8 financial sharks we should keep an open eye on are as follows:
1. Bureaucrats.
I am never against taxes and will never be. Taxes are an expense for living in a civilised society. Nigeria is just beginning to reposition its tax system and give teeth to legislation against tax evasion. This is a step in the right direction. What I am against, and entrepreneurs and investors have to watch this, is excessive taxation. Our state and federal governments in a bid to increase their income generation drive are coming up with tax regimes that may result in cold comfort for business activities.
Therefore, smart organisations should employ accountants who are knowledgeable about our tax system or they should work directly with tax consultants or professionals to enjoy certain provisions in our tax system not open to the “uninitiated” and to protect their businesses from predatory taxation. Also, people should, aside having earned income, also begin to grow their passive and portfolio income. The taxes on these types of income are less.
2. Bankers.
Bankers are supposed to protect your money and that is what they do. But recent events have confirmed the fears of people that banks and mutual fund institutions can also turn out to be financial sharks preying on the monies entrusted in their care. The case of Bernard Madoff and Allen Stanford still remain clear examples of a breach of trust between the investing public and financial institutions.
Can you imagine how many billions of dollars were lost to Madoff’s Ponzi scheme? Can you imagine how many people committed suicide as a result of their investments lost in that large-scale fraud? The last interview he gave in the prison few weeks ago, Madoff remarked that he never knew the fraud would last that long.
Therefore when you bank your money, peel your eyes and make sure your life savings are safe. Thank God for the bank consolidation in Nigeria. But you as an investor have to be very careful with your money. We have to watch these retirement fund providers, pension scheme programmes, fund managers and investment bankers, and even bank charges!
3. Brokers.
A broker is another word for a salesperson or agent. In the world of money, there are brokers for stocks, bonds, real estate, mortgages, insurance, businesses, etc. One of the problems today is that most people are getting their financial advice from salespeople, not rich people. Warren Buffett had this to say to that effect, “Wall Street is the place people drive to in their Rolls-Royce to take advice from people who ride the subway (train).”
As Robert’s Rich Dad put it, “The reason they are called brokers is because they are broker than you are.” While I do not discountenance the fact that we need brokers and that there are very good brokers around, finding the good ones is a difficult task. This is because good brokers are busy working with their higher net worth clients. So watch the broker you have. They can make you sink or swim financially!
4. Businesses.
All businesses have something to sell. The question we should ask ourselves is, “Is this business’s product or service making me richer or poorer?” “Is it making me healthier or a better person?” Some people buy products that make them poorer or sicklier. They patronise companies whose products or services push them further into debt.
When what you do is borrow to buy a product that does not put money in your pocket and spend years paying for that product, then you’re not being financially intelligent. Robert Kiyosaki says, “I like spending money on products or services that make me richer.” What about you?
5. Brides and Bridegrooms.
We all know that some people marry for money. Both men and women marry for money rather than love. Like it or not, money plays an important role in marriage. But some people are attracted to men and women and marry them, not because they love them, but because they love their money.
Examples abound all over the world like in America where a 50% divorce rate is prevalent leading to frequent divorces and 50% asset-sharing between spouses. While we may not be facing this type of problem in Nigeria or Africa yet because of our patrifocal social structure, there is and can be a mild damage done to anyone’s finances when your spouse is in the relationship for pecuniary reasons. So watch out for love predators as a young man, woman or rich person.
6. Brothers-in-law.
Death is the final exit. It is another time when financial sharks appear. If you are rich, not having financial intelligence can be very expensive. Michael Jackson was saved the embarrassment when initially they thought he had died intestate (without a will) only to discover that he had one prepared for him in 2002. Family, friends and the government show up at funerals when the deceased individual is rich.
Your fourth cousins, distant uncles, aunts, etc, and people you’ve never met, suddenly become family and come to cry at the funeral. If you have financial intelligence, the percentage of your money these grieving relatives receive will be controlled by you, even after you have moved on. Those with a high financial intelligence have wills, trusts, and other legal means of protecting their wealth and final wishes from death predators.
7. Barristers.
Do you know somebody once sued MacDonald’s claiming the coffee was too hot? That is an example of a financial predator. And you know what, lawyers are ready and will be willing to defend such financial predators? Millions of people are waiting for any excuse to use a lawsuit to get rich. There are lawyers whose sole purpose in life is to take you to court and take your money.
Knowing these financial sharks or predators are lurking in the shadows waiting for an opportune time to pounce on you, should make you do the following:
1. Keep nothing of value in your name. Don’t have your houses or properties in your name rather in your company’ name.
2. Buy personal liability insurance immediately. People in this part of the world toy with insurance. You need to also insure your assets.
3. Hold assets of value in legal entities like limited liability or public limited liability companies and limited liability partnerships. There are also bad legal entities such as sole proprietorships and general partnerships. Ironically, most small business owners are bad legal entities.
As you can see, protecting your money is not an option but a must for you. There are financial sharks prowling everywhere looking for whom to pounce on. When I started these write-ups, I have also had encounters with some of them calling and emailing me with phoney businesses and offerings that are laid with jagged traps.
God will save us. But we have a part to play in protecting ourselves from these sharks so we can live respectable lives and leave our families in comfort when we exit this earth.