Financial planner urges youngsters to start early

POSTED: 05/10/12 3:58 PM

St. Maarten – Insurance agent and financial planner, Tariq Ilahi has issued a stirring call for young people to become financially responsible in these changing economic times. In an interview with Today, Ilahi said that he was concerned that young adults in particular are still showing reluctance towards financial maturity. “We see a lot of this daily,” the financial planner said adding that if persons want to remain independent, even if they become old or sick, then they ought to consider their future now.

“Start young in your productive years with your first paycheck to build your financial nest. In this way you will able to accumulate more compounded interest and profit sharing. The purpose behind saving is that you are trying to accumulate enough funds maintain the same lifestyle for you and your family so that retirement time comes around, or death or disability, you will still be secure.”

Speaking on the demographics and trends on the island, Ilahi said that from young adulthood people are becoming too dependent on the social welfare system. He added that with people getting older and having a longer lifespan on average, it has serious consequences for the country’s pension scheme.

“People are getting older and we do not realize that this has serious consequences on whether or not our state pension (AOV) is sustainable for the future? This is because pensions (AOV) received today by the elderly are paid by the working people of now,” Ilahi opined.

Ilahi himself has been attached to Fatum Insurances for the past eight years but says that from a tender age he was exposed to saving. Today, parents seldom encourage their teens in particular to adopt responsible lifestyles. Instead they splurge on material things they can ill-afford.  Most of that money, Illahi believes, could have been put into a college fund.  “Schools also have a unique opportunity to educate the parents by advising them to provide for their children with a proper education since as any financial planning in life starts with a solid education.”

Even as Ilahi makes this appeal, he fears that persons will still delay planning for their financial future. “Anything that is unknown is never popular. If more people start to realize the power financial planning has and the enormous positive impact and financial security it can bring, people would embrace it.”

Some of the biggest mistakes young adults on the island make are abusing credit cards, purchasing expensive vehicles, spending their entire paycheck and co-signing on personal loans. Apart from these major issues, Ilahi believes the most common mistake is that “they postpone, delay, wait for tomorrow, but tomorrow never comes, until it is too late.”

 

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