Personal Finance/Wealth Management
The Sanctions Imposed On Russia Are Fuelling World Recession
Sanctions imposed on Russia are having a negative impact on Western economies at a time when they were starting to recover from the pandemic-led recession.
Both the UK and its allied friend, the USA(in good and bad), have banned the import of Russian oil, as part of the sanction imposed on Russia, making the price of the commodity jump to an unimaginable record level.
The other route is to turn to the Middle East, but it is reported that the Middle East leaders have refused to answer Biden’s calls. It looks like the US is losing its dominance on the world’s power here.
The Rising Cost Of Living Is Everywhere
No matter where you want to look, the rising cost of living is everywhere. Here in the UK, you can spend up to one hundred pounds to fill up an average family saloon vehicle. Even in the US, petrol is very cheap, a gallon (4.5 litres) has jumped to four dollars. The same with food, and other essential commodities, like gas and electricity.
In the UK, the government is looking to compensate households to the tune of four hundred pounds each. But that is like a drop in the ocean compared to the extensive expenses an average house is facing due to the sanctions.
Russia retaliates by cutting off its gas supply to Europe.
Income is not keeping up at all with what an average household is experiencing, and people generally are unhappy. Obviously, the market reaction is enormous, stocks are in freefall, and no one is picking them up because there is no money to invest. Commodities like precious metals are sky-rocketing:
- Gold is up 13.9% in the last month.
- Silver is up 13% in the last month
- Palladium is up 9%.
Meanwhile, the price of Uranium, because of its use in nuclear fuel has gone up by over fifty per cent since the Russian invasion of Ukraine.
The price of oil impacts just about every part of our economy.
A Bit Of Money-Saving Tips For Those In The UK
If you live in the UK, you might think of topping up your Pension fund and ISA (Individual Savings Account), which is guaranteed up to eighty-five thousand pounds by the government’s deposit protection scheme. Shop around for the best interest rate.
The mortgage interest rate also went up since last year, so it is in your best interest to shop around. Personally, I never like fixed real interest rates, because you lose out when the interest rate goes down, and it has been down for more than seven years in a row. But if you feel it is something you like, then go for it.
It is always the best financial management to regularly review your current subscriptions, and there are many of them, including insurance, energy, telephone, internet, etc. I read that Amazon Prime and Netflix are going up. Do you need them, if not, you could save a fortune by cancelling them? Is it possible to get any cheaper?
Do not pay for what you can get for free. Most supermarkets have apps that can save you money, like LIDL, for instance. Also, most bank cards have cashback options, take advantage of these. You can also negotiate a lower interest rate, you will not know until you try.
Planning your holiday well in advance can save you a substantial amount in early booking deals in hotels, and airfares.
Eliminate or reduce expensive habits like smoking, YOLO (You Only Live Once), gambling, and eating out.
Pay off your debt early enough, to reduce compounding interest rates. And start with the highest interest rate.
Always remember that you can regift unwanted gifts, instead of spending money to buy someone a gift. That is the power of recycling too.
Kira Dawn in Mad World below:
The Takeaways
- Differentiate needs from wants. A want is something nice to have, but I could do without it. Whereas a need is something I must have to live and thrive.
- You can grow your money by cutting unnecessary spending, and or increasing your income.
- Beware of the trap of a bargain. It will be a waste of cash if it is cheap, but I have no need for it.
- Living frugally is the best way to build up your wealth. Always review your spending habit.
DISCLAIMER
Although great research has gone into this post to give the true and genuine substance to it, nevertheless it does not still represent professional or financial advice in any way. It is therefore given for readers’ information and entertainment only.
Please seek professional help regarding any financial condition or concerns. Thank you.😑
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