The document discusses 4 future financial trends: 1) Home ownership will become more difficult as interest rates remain low, encouraging higher home prices. 2) Real incomes will continue declining due to globalization, automation, and inflation measurement issues. 3) There will be no secure careers as jobs are replaced by technology like AI. 4) Pension payouts will decline further as retirees withdraw funds while younger generations have to support them and put less into their own pensions. The document provides advice on financial planning to prepare for these trends, such as saving 10% of income each pay period and purchasing insurance to mitigate risks outside one's control.

1. Four Future Financial
Trends You Can’t Ignore
A financial literacy primer from www.onlinefinanceacademy.com

2. Many people still have their
head in the sand...
They may realise the future will be challenging
economically, but they either don’t want to see it, or they
don’t know how to prepare for it.
This presentation will give you a glimpse into the future and
help you prosper through what is likely to be a difficult era.

3. Here’s why...
Populations are rising and the planet
isn’t getting any bigger.
Interest rates are unlikely to rise
much, if at all, for many years to
come.
Trend #1 It’s not going to become any
easier to own your own home.

5. Low interest rates encourage people to buy homes and
speculate. This ‘cheap money’ leads to higher prices for
any asset that can be mortgaged or borrowed against.
This usually leads to price bubbles and crashes.
There is great incentive for Central Banks to keep
interest rates low because a rise in rates would stall the
economy and lead to many people losing their homes.
Why are interest rates unlikely to rise?
It’s a “Catch 22.”

6. Housing and prices may be in a bubble now,
but they will continue rising in the long run.
So what is the correct time to buy a house?
Don’t listen to the pundits on network TV because
they are almost always wrong - or state the obvious
when it’s too late. And your banker has his own
interests in mind.
You need to do 2 things…

7. 1. Think for yourself. Learn
about economic and stock
market market cycles and how
interest rates are determined.
2. Have a savings plan that
will give you access to capital
when the right opportunity
arises (which is during a crisis.)

8. This is why…
Disposable income has been declining since 1980.
Globalization has meant greater wage competition.
Inflation as reported by the government doesn’t accurately
reflect our true cost of living.
(see this link to how the Consumer Price Index (CPI) is calculated.)
https://www.businessinsider.com.au/breakdown-of-consumer-price-index-
basket-2014-1?r=US&IR=T
Trend #2 “Real” Income will continue to
decline.

9. http://www.shadowstats.com/article/no-445-special-commentary-review-of-economic-systemic-solvency-
inflation-us-dollar-and-gold-circumstances#_Toc327285856

10. This is why...
Wage gains have not kept pace with the price of real estate.
People have to spend a huge proportion of their income on
their mortgage or rent instead of other products
When you think about it, debt servicing does not lead to
growth in the economy like capital expenditures do. This
lower growth means Central Banks need to keep rates low in
order to inspire companies to borrow.
Their actions help maintain the trend of spiralling debt.
Putting all that together leads to a
dangerous debt spiral.

11. And like an earthquake, the debt
spiral continues… until it
eventually collapses, taking
most people by surprise.

12. Globalization and AI is leading
to greater wage competition.
AI is now replacing traditional white collar careers the way
robots replaced assembly line workers 20 to 30 years ago. As
we all know, software and robots don’t ask for wage increases
or medicare benefits. Most people’s jobs will be expendable!
Trend #3 There will be no such thing as a
‘secure’ career.

13. Baby-boomers are entering retirement. Capital will not be
flowing into investment funds and stocks, it will be coming out.
Stock market returns are likely to decline as a result.
Low interest rates mean a possible decline in the ‘real’ value of
your ‘safe’ fixed income investments.
Generation X and the Millenials will continue supporting baby
boomer retirees throughout their life and will be able to put less
back into pension funds to support their own retirement.
Trend #4 Pension fund payouts will decline
even further than you might imagine.

14. So what do you need to
do to survive and prosper
in the coming years?
In the next few pages, we will
present you with some Golden
Rules for Personal Financial
Planning.

15. http://www.npr.org/sections/krulwich/2012/09/15/160879929/that-old-rice-grains-on-the-chessboard-con-with-a-new-
twist12/09/15/160879929/that-old-rice-grains-on-the-chessboard-con-with-a-new-twist
Ignorance (most definitely) is not bliss
Remember the story of the foolish king who lost his wealth because he
did not understand the power of compound interest? Great investors
(like Warren Buffet) understand this power.
Our goal will be to show you how to think like the great investors of
our age. But this starts with taking baby steps.

16. Save - not for that ‘rainy day’ - but for how
to seize opportunity and avoid calamity
• Always live a lifestyle that consumes less that you earn and follow a
simple priority of saving 10% of earnings each pay period. Set up your
hard 10% savings as an automatic contribution.
• If you have difficulty living on 90% then a lifestyle reassessment is due.
Be honest on what you can live without and adopt choices to maintain
that savings discipline.
• After you feel the empowerment of saving for several months you will
be ready for exploring investment opportunities.

17. Remove Risks You Cannot Control
• Find your largest financial vulnerabilities (job loss, long term
disability, debt servicing, spouse & children) and deploy in budget
solutions to remove those risks before they blow up (e.g.
Accumulate savings, disability income insurance, debt consolidation,
life insurance).
• Confronting worst case scenarios while implementing affordable
solutions will remove risks, add sustainability and ultimately free up
creativity to increase your career success.

18. All Debt Is Not Created Equal
• Understanding and managing debt effectively is the single most
important element of personal financial planning. Understand that
debt starts out as credit offered to individuals
• Simple differentiation for good and bad:
Credit offered at a low cost (Interest rate) to purchase an asset that
holds its value over time (e.g. home purchase) becomes good debt
Credit offered at a high cost (Interest rate) to purchase an asset that
does not hold its value (e.g. expensive television) becomes bad debt

19. Chronology Of Personal Financial Management
•Commit to adopting the necessary behaviors to ensure sustainability.
•Organize and assess your current financial situation by building a snapshot
of your personal income statement and balance sheet. This will offer
immediate knowledge of your problem areas: like debt servicing or
travel/dining/entertainment spending.
•Solve specific problems (e.g. paying down $1000 credit card debt) with a
redirect from other discretionary spending (T/D/E). You solve two
problems at once.
•Establish your priorities for change and start detoxing your financial life.
•Create a forward looking budget that directs where your spending is going
to go in the future and stick to it!

20. Chronology
• After you have developed a savings surplus for a period of time, you
can start optimizing other great opportunities, like tax deductible
contributions to individual retirement savings plans (IRA, RRSP etc.)
• Always take the free money from your employer matching your
contributions to a corporate retirement plan, ex: 401(k). The lifetime
benefits to from these plans are huge massive.
• Most importantly: develop a mindset where the path of saving and
investing is psychologically more rewarding than spending and
consuming.

21. nN
No doubt you have seen
such charts before, but
we emphasize the
philosophy and
foundation of how to
create wealth:
Compound interest!

22. About Personal Portfolio Management
Finally, learn how to manage your own portfolio and get great advice
from an impartial mentor.
Introducing, Larry Gazette, with 33 years trading and portfolio
management experience - and a stellar record - Larry is your guide to a
more secure and more prosperous financial future.
You can reach Larry at: info@onlinefinanceacademy.com
About the course:
https://www.onlinefinanceacademy.com/classroom/personal-portfolio-management/
About the instructor:
https://www.onlinefinanceacademy.com/team/larry-gazette/