EKOnomia oszczędzania

Jakiś czas temu oglądałem nagrany przez NETFLIX i dostępny za pośrednictwem tej platformy dokument pod tytułem „Ścigając Koralowce”. Film ten opowiada historię biologów morskich badających rafy koralowe i przedstawia postępujące umieranie gigantycznych powierzchni niesamowitego podwodnego świata – w ciągu ostatnich dwóch lat umarło 25% Australijskiej Wielkiej Rafy Barierowej, a proces obumierania korali, stanowiących schronienie dla niezliczonych gatunków ryb, zachodzi na całym świecie. Proces spowodowany jest wzrostem temperatury wody, co z kolei jest wynikiem zwiększonej zawartości gazów cieplarnianych w atmosferze.

Przyznam szczerze, że podczas ponad 30 nurkowań zakochałem się w tym magicznym, świecie, będącym kilka(dziesiąt) metrów pod powierzchnią wody. Czasem wśród znajomych nurków żartujemy, że James Cameron kręcąc „Avatara” nie nakręcił filmu fantasy, a dokument o podwodnym życiu – tak bardzo kolorowy i bujny jest świat na głębokości 8-10 metrów. Oglądając umierające koralowce pękało mi serce i przez dłuższy czas nie mogłem dojść do siebie uświadamiając sobie jak bardzo nasze codzienne decyzje przekładają się na zdrowie naszej planety.

Po kilku dniach rozmyślań i drastycznego przemodelowania swoich nawyków zakupowych (ograniczając do niezbędnego minimum wykorzystanie materiałów nie podlegających recyklingowi i decydując się na produkty zapakowane raczej w surowce dające się ponownie wykorzystać, niż jednorazowe opakowania) włączył się mój zmysł finansisty. Zastanowiło mnie, ile więcej będę musiał zapłacić za moje ekologiczne podejście – przecież EKO nie może być tanie! Jakież było moje zdziwienie, gdy odkryłem, że wbrew pozorom EKO może być korzystne dla portfela. Postaram się to zobrazować na kilku przykładach.

Zacznijmy od przysłowiowej bomby. Półtoralitrowa butelka wody w sklepie osiedlowym potrafi kosztować nawet około 2 PLN. Nawet przyjmując, że kosztuje ona 1,5 PLN, metr sześcienny (1.000 litrów) wody butelkowanej kosztuje 1500 PLN. Wypijając 3 litry wody dziennie (2 butelki) płacimy zatem 3 PLN, czyli w skali roku 1095 PLN. Metr sześcienny wody, według portalu cena-wody.pl kosztuje średnio 10,9 PLN, miejscami dochodząc do 18 PLN (ceny brutto, uwzględniają koszty odprowadzenia ścieków). Zatem przyjmując wypijanie trzech litrów wody kranowej dziennie, zapłacimy maksymalnie 13,14 PLN. Co ważne jak donosi portal http://pijewodezkranu.org, woda z kranu jest nie tylko bezpieczna, ale i zawiera te same mikroelementy, które występują w wodzie butelkowanej. Zatem dostarczając naszemu organizmowi takiej samej jakościowo wody w skali roku oszczędzamy ponad 1000 PLN. Efektem ubocznym jest mniej plastiku, a to z kolei przekłada się na niższą ilość odpadów w koszu i jest korzystniejsze dla środowiska. Przykładów, takich jak opakowanie wody można mnożyć: sery, wędliny, ryby, mięsa – wszędzie, gdzie pojawia się dodatkowe opakowanie musimy za nie zapłacić!

Część z naszych Czytelników czyta ten felieton wieczorem, przy sztucznym świetle. I to właśnie ono jest bohaterem naszego kolejnego przykładu. Nie tak dawno temu postanowiłem wymienić wszystkie żarówki w mieszkaniu na energooszczędne LEDy. Nie dość, że zużywają znacznie mniej prądu niż klasyczne, to jeszcze mają zdecydowanie wyższą trwałość. Żarówka LED, z racji swojej konstrukcji, wykorzystując diodę dającą światło już przy niewielkim poborze energii, zużywa ułamek prądu dając tyle samo światła, mierzonego w lumenach (przyjmując pewne uproszczenia, im wyższa jest wartość wyrażona w lumenach tym więcej światła daje żarówka). Dla przykładu, zgodnie z danymi jednego z wiodących producentów oświetlenia LED, aby osiągnąć 800 lumenów potrzebujemy tradycyjnej żarówki o mocy 40 W, podczas gdy LEDowa żarówka dostarczy tyle światła przy mocy zaledwie 6 W. Oznacza to, że jedna żarówka LED po 6,5 godzinach świecenia zużyje w przybliżeniu tyle samo prądu co jedna żarówka 40 W w ciągu godziny.  Załóżmy teraz, że mamy w domu 10 żarówek o mocy 40 W. Koszt wymiany żarówek w zależności od miejsca zakupu jest różny, ale żarówki renomowanego producenta w najtańszym sklepie Internetowym powinny nas kosztować w sumie 160 PLN. Oznacza to, że przy sumarycznym czasie pracy 23h dziennie (czyli jeśli zapalimy 2 żarówki na raz czas sumaryczny wyniesie 12,5 h, a przy zapaleniu wszystkich dziesięciu zaledwie nieco ponad 2 godziny), już od drugiego roku zaczynamy oszczędzać. Może nie dużo, bo 156 złotych rocznie, ale jest to kolejny krok do dokonywania bardziej świadomych wyborów. Biorąc zaś pod uwagę fakt, iż żywotność zwykłej żarówki to około 1.500 godzin, a żarówki LED 15.000 godzin oszczędności w skali żywotności żarówki są znaczne. Dodatkowo, zakładając koszt 4 PLN za zwykłą żarówkę, w czasie żywotności jednej LED wydamy dodatkowo 40 PLN na żarówki konwencjonalne. Technologia LED pozwala nam nie tylko dbać o planetę, ale też o portfel. I tu znów przykładów jest wiele: Lodówka, płyta kuchenna, piekarnik, pralka… Wszystkie urządzenia zużywające mniej mediów przekładają się na korzyść dla portfela i planety… Już kilka złotych oszczędności dziennie może dać pokaźny zysk w długim terminie – więcej na ten temat w artykule „Co kawa i procenty mają wspólnego z oszczędzaniem”. Pamiętajmy tylko o recyklingu zużytych urządzeń.

Jak zatem widać, czasem wydając trochę pieniędzy i zadając sobie odrobinę trudu jesteśmy w stanie uzyskać znaczny zwrot z takiej inwestycji w długim terminie – podobnie jest w przypadku przedsiębiorstw, które najpierw inwestują na przykład w nową fabrykę, a następnie zarabiają na wyprodukowanych w owej fabryce dobrach. Jak głosi maksyma, prawa ekonomii w przypadku sklepu spożywczego nie różnią się od praw ekonomii obowiązujących korporacje – inna jest tylko skala działalności. Ta sama zasada dotyczy finansów osobistych, czy inwestycji. Kluczem do podejmowania dobrych decyzji jest świadomość ich konsekwencji. Jak głosi lekcja płynąca z „Ekonomii w Jednej Lekcji” Henry’ego Hazlitt’a – wybitnego amerykańskiego ekonomisty: „Sztuka ekonomii polega na tym, aby spoglądać nie tylko na bezpośrednie, ale i na odległe skutki danego działania czy programu; by śledzić nie tylko konsekwencje jakie dany program ma dla jednej grupy, ale jakie przynosi wszystkim.

Check Whether or Not You Invest in a Pyramid Scheme

Every once in a while, we hear about funds that offer very high returns, but which later fall from grace and which fail to pay investors anything. In Poland, the most famous case was Amber Gold, and in the United States the most famous case was the Bernie Madoff Affair, swindling investors for sixty-four million dollars. In spite of this, we still hear about pyramid schemes collapsing like houses of cards from time to time, mainly because there are still those who willingly become engorged by the lure of such organisations. Indeed, greed without forethought is more conniving and quicker at the helm than other humanly desires, and ultimately may compel some individuals to put their money in pyramid schemes.

What exactly is a pyramid scheme?

A pyramid scheme is an institution that promises high returns from investment. The only problem with this is that the institutions do not actually invest our money. Rather, the money of “clients” is given to support the luxurious lifestyles of those who manage the institution. All return on investment exists solely and exclusively on paper. The sort of pyramid scheme that existed for many years in the Bernie Madoff affair was allowed to have a place in the world on the condition that the number of people investing in the fund did not surpass the number of people who demand their returns on investment. The return on assets for people taking out their capital from the fund is made possible by the money of people who are coming into the fold. However, this is only a matter of time. When investors become frightened by market fluctuations, or other events transpire that cause a loss from investment, those who partake in the scheme begin to take out their financial assets, which results in the death of the pyramid scheme. Because the pyramid is not able to hide the outflows of our assets with new inflows from new investors, this becomes the moment when we need to acknowledge our money as forever forgone and lost.

The average lifespan of a pyramid scheme is around six to eight years, even though the Bernie Madoff scheme existed for twenty years. The reputation of the person (Bernie Madoff used to be the Chairman of the American electronic exchange, NASDAQ), as well as the luxurious building on Wall Street (called the Lipstick Building) built trust, which allowed him to sustain the scheme for around twenty years. This is rare, however.

Whilst conducting a lecture touching upon the workings of pyramid schemes many pupils could not believe that the returns from investment, visible through the billings of the scheme, did not really exist. Indeed, a pyramid scheme from the onset does not invest the financial assets of its clients. They write them artificial interest rates, or returns on investment, but it is necessary to understand that physically they do not conduct any investment and we do not obtain any financial products. Everything merely appears on paper and the billings are falsified. Of course, however, this does not mean that investors do not retain anything. After time, when new people bring their money into the pyramid, our returns are paid in accordance with what is shown on paper. But when others stop to invest in the pyramid we have to consider our savings as lost.

Whilst conducting research concerning why people invest in pyramid schemes, many of those responding stated that they hope to manage to take themselves out before the fall of the scheme. The only issue being, when exactly this will take place. Sometimes this is associated with panics in the market arising through a financial crisis (as was the case with the fall of the Madoff scheme), and sometimes this is associated with a very irrational type of situation. However, something that is irrational is not necessarily predictable. So, we have to consider that we will not always be smarter than others.

Pyramid schemes are certain attributes, making them identifiable.

What to look out for?

  1. Above-average returns

Pyramid schemes often offer very high returns in the hope of winning over potential clients: 20% in the course of a month or in the course of a year is standard. Some funds in Poland even offer 300%!!! Even the best “traders” in the world are not able to bring in above-average earnings in the long term (as has been proven by academic research). The sorts of products that offer high returns in the long run are simply not on the market. Why? Investors are smart and start to quickly exploit the situation, which leads to bubbles on the said market, and it inevitably and subsequently bursts. Furthermore, in order to give clients 20% return on investment they have to earn much more in order to sustain their operational costs, which are often very high. Let us remember that in the last several years the market has on average offered 10% gains on investment. If someone tells us that they are in the position to offer higher than the market in the long run, then we should immediately tell them thank you, but no thank you.

  1. Guarantee of returns

Pyramid schemes also often offer guarantees on returns. However, all investment in financial markets carries with it a certain degree of investment risk. It is necessary to realise that if someone begins to guarantee high returns, we should be in disbelief. From our basic assumptions about finance, such a thing is necessarily impossible.

  1. Complication of strategy

When we ask the managers of a pyramid scheme how they generate such high returns we often hear that they make use of very complicated financial strategies, or some set of financial engineering. However, complicated investment strategies do not generate above-average risks whatsoever, and they are often a product of high risk. What is more, many strategies mentioned by managers of such schemes do not exist. Furthermore, these institutions also invest in international instruments in order that people from the home country do not understand the investment portfolio.

  1. Principle of trust

Pyramid schemes never elaborate on their own investment strategies while – at the same time – making transparent their so-called principle of trust. Current financial regulations require that in order for the client to be well-informed both about which products they invest in, they have to know about the institutions underlying such products as well as the implicit risk of such products. Pyramid schemes never do this, as they are not in the slightest a transparent entity.

  1. High commissions for sellers

Pyramid schemes have a very highly-developed network of sellers and provisional programs for sellers. Amber Gold had departments and stakes in almost every shopping centre, city centre, as well as by every well-known pedestrian zone. How much would someone have to earn in order to hide such high operational costs and at the same time offer 10% returns. Certainly not as much as the market offers. Such financial wizardry simply does not exist.

Furthermore, pyramid schemes often lure people with the opportunity to earn above and beyond. One Polish fund offers extremely high commission on sales (coming to around 20%), provided that someone willingly wants to be committed to investing in it. Nonetheless, the market itself does not offer as much of a farthing of the amounts that would be necessary for this to be possible.

  1. Aggressive internet-marketing

Many pyramid schemes have a preeminent presence on the internet. They entice viewers with a high number of high-quality advertisements. Everything boils down to attracting the most amount of people possible. Aggressive marketing is then one of their key-characteristics.

Your First Million

Money, and especially when in large sums, has always never failed to inspire. The ancients fantasised about it, and the peoples of the medieval age and the renaissance pondered with awe and wonder at the thought of it. Today, modern peoples become preoccupied with the idea of it. In pop-culture, money is the single attribute of success. And however much of it seems unfit to live a “good” life, we have all probably had the opportunity to daydream about what we would do if we managed to make millions.

As Jan Krzysztof Bielecki once claimed: one has to steal their first million. However, old, Polish industrial whispers claim that one grosz of one’s own design is worth more than one million freely given. So how must one therefore earn a million zloty? This perhaps is not so straightforward a question to answer as the answers to twelve questions on a popular television quiz show through the elimination of six winners from forty-nine participants suggests, but the answer nevertheless brings much satisfaction.

Some people dream of riches, not to speak the least of Nick Carraway, the protagonist of the novel by Francis S. Fitzgerald, The Great Gatsby, who won his riches by means of the market. Not one investor starting from zero in the trade of shares was able to make a fortune, and not one lost their fortune. But in the due course of things does the ordinary investor lose? As statistics seems to verify – not necessarily. Everything depends on the strategy taken, and moreover, how we establish three scenarios – assuming that while working we manage to set aside a somewhat lofty sum of 1,000 USD. For the requirements of the experiment we likewise will want to establish that the aforementioned thousand is distributed 10, 20, 30 and 60 years later. How much would we manage to save if we invested all of this money through an index? For the purposes of the experiment, let us assume that the invested sum is put into an index, because the movements thereof are restricted to the risk connected with individual financial instruments. However, at the same time, as has been shown by research conducted by Famy from the year 1970, it is not possible in invest in the long term while at the same time receiving the results achieved by the index – in reality only a very elite circle manages to do so.

However, our equity securities only exist for some time, so for this sort of experiment we will have to concentrate on the American S&P 500, an index that follows the market capitalisation of 500 of the largest American public companies. The first quotes for the index took place on the fourth of March 1957, so on the occasion of its sixty-year anniversary we will assume that it is there that we invest our thousand dollars.

60 years ago, our one thousand dollars upon the establishment of the index would have yielded a return of 3,656.85%, or 36,568.50 USD. These are huge returns indeed. This means that if we would want to have one million in the course of sixty years today we would have then had to invest 26,618.04 USD.

30 years ago, at the beginning of economic transformation in Poland, our thousand dollars invested in the American equity market would yield 6,265.20 of today’s dollars. However, in order to earn a million, we would have had to invest 137,642.64 USD at that point. Today we would have been more than happy to have such gains.

Two decades ago, when for one dollar we paid 3.07 PLN, our one thousand would have multiplied twofold, such that in 2017 it would have more or less doubled the current value of which would have amounted to 1,855.69 USD. In order to make a million, we would have to had put down 350,178.05 USD, however.

Investing one thousand dollars ten years ago we would have had gains of 76.84%, and so in order to have one million we would have had to have had 565,482.92 USD put down. It is important to recognise that all of these calculations are taken into account with due consideration for the changes in the amounts of money due to inflation (the effect of an increase in the prices of ordinary goods with the development of the economy).

As seen by the examples above, the earlier we are able to set aside sums of money, the less amount of money we need in order to realise the riches about which we so often dream. It is important to choose solutions which are appropriate to the needs of the investor. It allows one to reduce the unnecessary nervousness and maximise returns. This sort of a solution is provided by EFTs, because they effectively replicate the behaviour of indices, and those funds we need not take on any additional, unwanted risk, in the long term obtaining the chance for above-average risks as a result.

*The data for the level of returns are taken from DQYDJ.com

Looking to Increase Your Wealth?

From time to time, each one of us complains about having little money. “If I were to have more I would go on vacation, I would send my child to a good school, or have a decent retirement.” However, none of us thinks about how to conduct ourselves in such a way so that we actually have more. Rather, we focus on complaining about miniscule earnings or a lame job, overlooking the fact that only through the intelligent management of our finances can we become richer. It appears to be the case that through the poor management of our finances that we lose our fortune. Both Americans, French, and also Germans calculate that we lose around four percent of our profits annually. This means that if we were set aside 1,200 zł (i.e. monthly setting aside 100 zł) we would lose around 50 zł (1,200 * 0.04). One could say that this is not a lot, but in the course of five years, this would amount to 260 zł, and after ten years 600 zł. In Poland, unfortunately, there is a lack of similar research showing how much we lose through poor financial management, but we can suspect that the amounts are similar.

How then can we begin to increase our wealth? We start today from the presentation of key advice, which will become ever clearer in the coming days of the blog:

First tenant: Set a goal that you want to achieve. The goal must have textbook-like characteristics. In other words, it has to be realistic and it should have a rather large time horizon (from three years and above). It is difficult to effectively manage your savings if you have to recall bits of it from time to time.

Second tenant: Think about how much you can put away every month. Start from small amounts, and later – in accordance with your own abilities – increase this amount. Each zloty that you put aside works for you. It is within this conceptualisation that you should think about savings. In finance, we have a concept called opportunity cost. If you do not invest, then you lose. Think about how much you lose when spending money on unnecessary things, or leaving the money to sit in your bank account. Now think about how these sums can begin to become the gains that reduce the distance between you and your goals.

Third tenant: You will never get wealthier keeping money on deposit. You have to effectively invest your money in order that it works for you. Capital markets can be a reliable means in that regard. However, you have to know in which products it is necessary to invest. That is why we encourage financial education. Research shows that people who are independent in making decision about their savings, that is, they do not make use of financial advisors, earn higher gains than people who do use that kind of help. Today’s widely available amount of information makes possible the sort of education necessary for our own needs. We make use of great blogs as well as financial portals in order to understand basic financial principles.

Fourth tenant: Minimalize risk. With this in mind, you should tread lightly while investing your money. Look for products with low risk, but which at the same time offer levels of gains higher than the rate of inflation. Do not invest all of your money in the same capital class, as with shares for example, and do not invest all of your money in the same economic sector, as in the case of gas. Highly-diversified products prove to be a reliable agent in that respect. And you don’t have to be well-acquainted with finance to do this. You can invest either in balanced investment funds or in exchange-traded funds (ETFs), which have an advantage over normal investment funds due to their low costs of investment.

Fifth tenant: Constrain the costs of investing. Look for products where you don’t have to pay a lofty sum for selling assets or investment fund managers. Everything for which you must pay should lessen the risks of investment. Look for brokerage houses, which offer low prices for accounts as well as fees for transactions. In recent years there has been an increasing number of Fintech companies, which enable investing at a global level for low fees.

The following is a flash card from the calendar of a Financial Advisor, Vanguard, one of the best Fintechs in charge of managing private wealth.

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