Before you tread on investing waters, it is helpful to know the most common pitfalls which every aspiring investor must avoid at all costs.
1. Doing nothing. Waiting for the grass to grow will not help you achieve a comfortable retirement.
2. Starting late. Procrastinating on an investment is the second biggest mistake to make. The earlier you start investing, the better off you will be.
3. Investing with unresolved credit card debt. Before even dreaming of a career in investing, pay off your credit card debt first. If you have $5,000 to investment and roughly the same amount owed to credit card companies, investing will surely be counterproductive.
4. Short-term investing. Invest money on shorter-term and safer havens for short-term goals. Invest the rest of what you have that you do not need for at least three years on the stock market.
5. Refusing free money. Never turn down a dollar offered provided it has no strings attached. Take advantage of what your company offers such as a 401(k) or similar tax-advantaged retirement savings plan with an employer match.
6. Playing it safe. This is a sin if you are young and you are missing out on investing in stock. Youth has its privileges. Be more of a risk-taker and reap long-term profits in stock. You have time on your hands to survive whatever the dips in the stock market and can choose to transition into bonds later.
7. Playing it scary. Being a daredevil is not always profitable. Do not risk all your money into a doomed investment.
8. Believing collectibles are investments. Collectible memorabilia or paraphernalia will not provide for you in the years to come.
9. Trading in and out of the market. Stick to a long-term investment for bigger profits. Trading in and out will burden you with fees later on and slice away your returns.
Friday, October 23, 2009
Friday, October 16, 2009
Goodbye, Bruce Wasserstein
I was saddened by the news of the financial mogul, Bruce Wasserstein. He was a legend in the private equity industry. Bruce Wasserstein led Lazard during its some of its most difficult times, and transformed the firm into a modernized, streamlined powerhouse. Here are some links to some articles about Bruce Wasserstein's passing:
Lazard Tribute to Bruce Wasserstein, veteran of 1,000 mergers (Guardian)
Remembering Bruce Wasserstein (Newsweek)
Lazard Tribute to Bruce Wasserstein, veteran of 1,000 mergers (Guardian)
Remembering Bruce Wasserstein (Newsweek)
Monday, September 28, 2009
Budgeting Basics for Lazy People
Let’s face it. Most people find budgeting an unenjoyable activity. Many keep putting this task off until the next day, and end up never doing it. Are you that kind of person? If you are, Dayana Yochim of Fool.com has written a simple technique for the budgeting lazybones.
1. Know exactly how much you spend: To appreciate the virtue of saving, you must be personally aware of the excesses in your spending. List all your expenditures and categorize them. People who use cash can write down their expenditures on a day-to-day basis. Those who use credit or debit cards may get data from monthly bank statements. Input the data into a spreadsheet and be amazed.
2. Make your spending plan. After you get over the initial shock, you can start making your “spending plan.” The idea is to make a list of the most important purchases you need to make within the next three or six months. Include the physical purchases and financial plans you need to pay. This list will guide and direct your spending
3. Compute money to set aside. Single out the items on the list that will run you every month (ex. new tires), divide the total amount for that item with the number of months until you need them anew.
4. Put your savings on autopilot. To ward off surprise expenditures, hide your money from yourself. Open a separate savings account from the one you use for expenditures. You already computed how much money you need to put away monthly in
5. Instruct your bank to program recurring cash transfers from your main account to your separate savings account.
6. Discipline yourself. Use the “envelope method” to prevent mindless overspending. Compute the total weekly amount you need to spend on essentials. Categorize them and insert the allotted budget inside the envelope. This is the money you’re allowed to spend each week.
1. Know exactly how much you spend: To appreciate the virtue of saving, you must be personally aware of the excesses in your spending. List all your expenditures and categorize them. People who use cash can write down their expenditures on a day-to-day basis. Those who use credit or debit cards may get data from monthly bank statements. Input the data into a spreadsheet and be amazed.
2. Make your spending plan. After you get over the initial shock, you can start making your “spending plan.” The idea is to make a list of the most important purchases you need to make within the next three or six months. Include the physical purchases and financial plans you need to pay. This list will guide and direct your spending
3. Compute money to set aside. Single out the items on the list that will run you every month (ex. new tires), divide the total amount for that item with the number of months until you need them anew.
4. Put your savings on autopilot. To ward off surprise expenditures, hide your money from yourself. Open a separate savings account from the one you use for expenditures. You already computed how much money you need to put away monthly in
5. Instruct your bank to program recurring cash transfers from your main account to your separate savings account.
6. Discipline yourself. Use the “envelope method” to prevent mindless overspending. Compute the total weekly amount you need to spend on essentials. Categorize them and insert the allotted budget inside the envelope. This is the money you’re allowed to spend each week.
Friday, September 25, 2009
Vikram Pandit
Vikram Pandit is the CEO of Citigroup Inc., a New York-based American financial services company that holds the world's largest financial services network and controls over 200 million customer accounts in over 140 countries. As of 2008, the company became the world's largest bank by revenues.
Born to a well-to-do Maharashtrian family in Nagpur, India on January 14, 1957, Vikram Pandit seemed to have the world at his feet. After graduating from the Dadar Parsee Youths Assembly High School, Vikram Pandit flew to the United States to attend Gannon University.
Vikram Pandit chose to further his education at Columbia State University where he received his Bachelor's Degree in 1976 and his Master's Degree in 1977. In 1986, he received his PhD in Finance from the Columbia Business School.
Before his success at Citigroup Inc., Vikram Pandit worked as a professor at Indiana University Bloomington. It was not until 1990 that Pradit built his ties with Morgan Stanley, a diversified group of corporations, governments, financial institutions, and individuals. He became managing director and head of the US Equity Syndicate until 1994.
In 1994 he became head of head of Morgan Stanley's institutional securities division. At Morgan Stanley, Vikram Pandit was instrumental in the introduction of electronic trading as well as the creation of services that helped cater to hedge-funds. By 2005 he had served at the company as President of Institutional Securities, Chief Operating Officer of Institutional Securities, and Member of Management Committee. The Indian government gave him recognition with the Padma Bhushan award in 2008.
In 2007, Vikram Pandit joined Citigroup Inc. In December, the company appointed him as CEO. At present day he is the Head of Alternative Investments, Chief Executive Officer, and Member of Operating and Management Committee at Citigroup Alternative Investments. He is also the Chief Executive Officer of Citigroup Inc. Vikram Pandit is Co-Founder of Old Lane, LP.
Born to a well-to-do Maharashtrian family in Nagpur, India on January 14, 1957, Vikram Pandit seemed to have the world at his feet. After graduating from the Dadar Parsee Youths Assembly High School, Vikram Pandit flew to the United States to attend Gannon University.
Vikram Pandit chose to further his education at Columbia State University where he received his Bachelor's Degree in 1976 and his Master's Degree in 1977. In 1986, he received his PhD in Finance from the Columbia Business School.
Before his success at Citigroup Inc., Vikram Pandit worked as a professor at Indiana University Bloomington. It was not until 1990 that Pradit built his ties with Morgan Stanley, a diversified group of corporations, governments, financial institutions, and individuals. He became managing director and head of the US Equity Syndicate until 1994.
In 1994 he became head of head of Morgan Stanley's institutional securities division. At Morgan Stanley, Vikram Pandit was instrumental in the introduction of electronic trading as well as the creation of services that helped cater to hedge-funds. By 2005 he had served at the company as President of Institutional Securities, Chief Operating Officer of Institutional Securities, and Member of Management Committee. The Indian government gave him recognition with the Padma Bhushan award in 2008.
In 2007, Vikram Pandit joined Citigroup Inc. In December, the company appointed him as CEO. At present day he is the Head of Alternative Investments, Chief Executive Officer, and Member of Operating and Management Committee at Citigroup Alternative Investments. He is also the Chief Executive Officer of Citigroup Inc. Vikram Pandit is Co-Founder of Old Lane, LP.
Monday, September 21, 2009
Marc Lipschultz (KKR)
(This is my fifth article on the leaders of KKR. Be sure to check through my archives to find other KKR notables). -Stan
Being pioneers of the business, it is easy to assume that to replace Henry Kravis and George Roberts is something that the firm would rather not think about, especially now that the business is booming and opportunities seem to appear in every corner. KKR still looks ahead with gusto to the future with the two founders still at the helm of the ship.
But to give credit where credit is due, the two founding partners are not just resting on their laurels. Little by little, the two have taken steps in future-proofing their firm; in making sure that whenever they decide to give up the driver’s seat, they will be leaving the steering wheel at the hands of capable drivers. Many critics doubt that anyone can replace what the pioneers have done with regards to the business industry. But with these potential, one can see that they have at least a strong fighting chance to do so. One of the up and coming minds that play secondary captains to KKR’s ship is Marc Lipschultz.
Marc Lipschultz is one of the leaders of the energy industry group at KKR and was involved in all aspects of KKR's investment in International Transmission Holdings and the announced agreements to invest in UniSource Energy Corporation and Texas Genco. A graduate of Stanford University and the Harvard Business School, Marc Lipschultz also serves as member of the board of directors in companies like Amphenol Corporation and The Boyds Collection Limited. He also serves as a special advisor along with Henry Kravis for the company Accel KKR.
Dubbed as the rising star of KKR, Marc Lipschultz joined KKR 12 years ago, coming from Goldman Sachs. At 38, he has already been involved in many of the firm’s big company acquisitions like the $45 billion purchase of TXU, a Texas-based energy group.
Through hiring individuals with class like that of Marc Lipschultz, the doubts that the future of KKR after its founders have left will be forgotten in many of the critics’ minds.
Being pioneers of the business, it is easy to assume that to replace Henry Kravis and George Roberts is something that the firm would rather not think about, especially now that the business is booming and opportunities seem to appear in every corner. KKR still looks ahead with gusto to the future with the two founders still at the helm of the ship.
But to give credit where credit is due, the two founding partners are not just resting on their laurels. Little by little, the two have taken steps in future-proofing their firm; in making sure that whenever they decide to give up the driver’s seat, they will be leaving the steering wheel at the hands of capable drivers. Many critics doubt that anyone can replace what the pioneers have done with regards to the business industry. But with these potential, one can see that they have at least a strong fighting chance to do so. One of the up and coming minds that play secondary captains to KKR’s ship is Marc Lipschultz.
Marc Lipschultz is one of the leaders of the energy industry group at KKR and was involved in all aspects of KKR's investment in International Transmission Holdings and the announced agreements to invest in UniSource Energy Corporation and Texas Genco. A graduate of Stanford University and the Harvard Business School, Marc Lipschultz also serves as member of the board of directors in companies like Amphenol Corporation and The Boyds Collection Limited. He also serves as a special advisor along with Henry Kravis for the company Accel KKR.
Dubbed as the rising star of KKR, Marc Lipschultz joined KKR 12 years ago, coming from Goldman Sachs. At 38, he has already been involved in many of the firm’s big company acquisitions like the $45 billion purchase of TXU, a Texas-based energy group.
Through hiring individuals with class like that of Marc Lipschultz, the doubts that the future of KKR after its founders have left will be forgotten in many of the critics’ minds.
Thursday, September 17, 2009
George Roberts: Model Businessman
(This is my fourth article on my series of the people who run KKR. Check out my bios of Henry Kravis, Scott Nuttall, and Bill Janetscheck).
George Roberts is a revered businessman in the realm of financial industry. Heading the successful financial firm Kohlberg, Kravis, Roberts & Co (KKR) with Henry Kravis, he has obtained success through careful and efficient leadership. KKR has been involved in many of the last three decades’ biggest acquisitions, most notably that of RJR Nabisco in 1988. This aggressive yet effective leadership style characterizes George Roberts’ skills as a businessman. For more than three decades, this financial industry leader has influenced many of his colleagues with the way he carries himself and the firm.
George Roberts reveals that the firm’s culture depends on their reputation; that their word is their bond; and both are paramount to their success. These values upheld by George Roberts are reflected in the way their firm operates as a whole. KKR is responsible for many of the world’s largest and most complex private equity transactions worldwide. A reputation for integrity and fair dealing, the firm relies on this reputation to generate and add to their distinguished record of profitable and successful ventures.
Majority of his colleagues in the financial industry see George Roberts as a model businessman. Throughout his career, he has received accolades reflecting how excellently he works not only in his corporate job but also with activities beyond his business. He received his alma mater Culver Military Academy’s Man of the Year Award and has been consistently included in the Forbes List of Richest Americans, merits that are deservedly his to take. Guiding their protégés, both he and his cousin, Henry Kravis, are building up and ensuring the future of KKR. By being an example to the next generation KKR management, George Roberts will be able to retire knowing that he has maximized every opportunity that has come his way.
George Roberts is a revered businessman in the realm of financial industry. Heading the successful financial firm Kohlberg, Kravis, Roberts & Co (KKR) with Henry Kravis, he has obtained success through careful and efficient leadership. KKR has been involved in many of the last three decades’ biggest acquisitions, most notably that of RJR Nabisco in 1988. This aggressive yet effective leadership style characterizes George Roberts’ skills as a businessman. For more than three decades, this financial industry leader has influenced many of his colleagues with the way he carries himself and the firm.
George Roberts reveals that the firm’s culture depends on their reputation; that their word is their bond; and both are paramount to their success. These values upheld by George Roberts are reflected in the way their firm operates as a whole. KKR is responsible for many of the world’s largest and most complex private equity transactions worldwide. A reputation for integrity and fair dealing, the firm relies on this reputation to generate and add to their distinguished record of profitable and successful ventures.
Majority of his colleagues in the financial industry see George Roberts as a model businessman. Throughout his career, he has received accolades reflecting how excellently he works not only in his corporate job but also with activities beyond his business. He received his alma mater Culver Military Academy’s Man of the Year Award and has been consistently included in the Forbes List of Richest Americans, merits that are deservedly his to take. Guiding their protégés, both he and his cousin, Henry Kravis, are building up and ensuring the future of KKR. By being an example to the next generation KKR management, George Roberts will be able to retire knowing that he has maximized every opportunity that has come his way.
Wednesday, September 16, 2009
Bill Conway
Bill Conway is one of the three co-founders of The Carlyle Group, a Washington-based private equity investment firm that focuses on leveraged buyouts, growth capital, real estate, and leveraged finance investments. The company is one of the largest private equity firms in the world with nearly $50 billion under management.
Born William E. Conway Jr. in 1949 in McLean, VA, this business powerhouse led a pretty conservative life. His genius shone through early on as he received his undergraduate education at Dartmouth College and later on, his M.B.A. at the University of Chicago Graduate School of Business.
Bill Conway, who has 20 years of experience in the industry under his belt, always had an uncanny knack for business and finance. Before founding Carlyle with Dan A. D'Aniello and David M. Rubenstein, Bill Conway spent almost ten years with The First National Bank of Chicago. There he served an array of positions dealing with corporate finance, commercial lending, workout loans, and general management.
In 1981, after his time at The First National Bank of Chicago, Bill Conway served at MCI Communications, the second largest long-distance provider in the United States. At MCI, Bill Conway was instrumental in several of the company’s most significant acquisitions and divestitures. He served as a Vice President and Treasurer of MCI from 1981 to 1984. He then spent as three years the Senior Vice President and Chief Financial Officer.
In 1987, Bill Conway founded The Carlyle Group. The company continues to broaden its scope for potential investment opportunities. They also constantly improve their level of expertise in order to provide superior returns to investors. Presently, Bill Conway serves as Managing Director The Carlyle Group and chairman of Carlyle's investment committees.
Constant in his reserve, Bill Conway continues to support several local charities, especially those that support the causes of education and the Catholic Church.
Born William E. Conway Jr. in 1949 in McLean, VA, this business powerhouse led a pretty conservative life. His genius shone through early on as he received his undergraduate education at Dartmouth College and later on, his M.B.A. at the University of Chicago Graduate School of Business.
Bill Conway, who has 20 years of experience in the industry under his belt, always had an uncanny knack for business and finance. Before founding Carlyle with Dan A. D'Aniello and David M. Rubenstein, Bill Conway spent almost ten years with The First National Bank of Chicago. There he served an array of positions dealing with corporate finance, commercial lending, workout loans, and general management.
In 1981, after his time at The First National Bank of Chicago, Bill Conway served at MCI Communications, the second largest long-distance provider in the United States. At MCI, Bill Conway was instrumental in several of the company’s most significant acquisitions and divestitures. He served as a Vice President and Treasurer of MCI from 1981 to 1984. He then spent as three years the Senior Vice President and Chief Financial Officer.
In 1987, Bill Conway founded The Carlyle Group. The company continues to broaden its scope for potential investment opportunities. They also constantly improve their level of expertise in order to provide superior returns to investors. Presently, Bill Conway serves as Managing Director The Carlyle Group and chairman of Carlyle's investment committees.
Constant in his reserve, Bill Conway continues to support several local charities, especially those that support the causes of education and the Catholic Church.
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