The gifting phase is similar to, and may be concurrent with, the spending phase. In this stage, individuals believe they have sufficient income and assets to cover their expenses while maintaining a reserve for uncertainties. Excess assets can be used to provide financial assistance to relatives or [...]
Posts Tagged ‘loans’
November 16th, 2010 - 3:35 pm § in Investment, Spending Phase
Spending Phase
The spending phase typically begins when individuals retire. Living expenses are covered by social security income and income from prior investments, including employer pension plans. Because their earning years have concluded (although some retirees take part-time positions or do consulting work), [...]
November 14th, 2010 - 3:32 pm § in Accumulation Phase, Investment
Accumulation Phase
Individuals in the early-to-middle years of their working careers are in the accumulation phase. As the name implies, these individuals are attempting to accumulate assets to satisfy fairly immediate needs (for example, a down payment for a house) or longer-term goals (children’s college education[...]
November 15th, 2009 - 8:55 am § in Long-term Positions
Long-term Positions
Positions that are of longer term are more often hedged through swap markets than forward markets. The structure of a foreign currency swap is very similar to that of a floating rate interest rate swap. We will take the case of a floating rate ¥1000bn five-year loan with interest paid every three m[...]
October 2nd, 2009 - 8:53 am § in GAP ANALYSIS
GAP ANALYSIS
In many countries banks are required to disclose their period-end interest rate gap positions in the form of the following report. These reports show balance sheet assets and liabilities broken down by when they are next due for repricing. The effects of off-balance sheet items such as swaps are als[...]