UNAUTHORISED FINANCIAL INSTITUTIONS

EVERYONE WANTS TO GET THE HIGHEST POSSIBLE RETURNS FROM HIS OR HER SAVINGS. This is not only reasonable, but necessary if you are to become independent during your working career.

Jamaicans are very savvy in their dealings with money and are always on the lookout for the best deal. Because of this, there are always others who will take advantage of us, if we are not very careful.

Jamaican law requires anyone who offers investment opportunities to the public to provide information, which allows the Government to check the individual and ensure that he is not a ‘carry down artist’.

For the past 5 years, Jamaicans at home and abroad, have been offered the opportunity of investing money which will provide amazing returns. While commercial banks , credit unions, building societies and similar organizations have offered rates of interest from 2% to 12% per year. These new schemes have offered to give 10% and above per month, which works out at over 100% per year.

The Financial Services Commission in Jamaica has been running advertisements in the newspapers warning against such schemes because they were not registered and the Government could not guarantee that the money was safe.

So far, at least 3 of the schemes have failed and hundreds of investors have lost millions of dollars. Because they were not registered, no one is certain exactly what is the status of the other operations. Many people are saying that, as adults, they are prepared to take whatever risks they wish. I would advise you as follows:

1. Divide your money into 2 groups – essential funds and dispposable funds. ESSENTIAL

ESSENTIAL funds are MONIES  to pay rent, school fees, groceries, medical insurance, etc. DISPOSABLE funds are money that you may use to visit the cinema, a football match, or buy some decoration on  your car.

With ESSENTIAL funds, you should only put those in a commercial bank, or some registered institution. With DISPOSABLE funds, you can take chances – buy the lottery, play slot machines, or enter into unregistered investments. The thinking is that if you lose DISPOSABLE funds, you will not be imperilling your family, your house or your pension when you retire.

By the way, I would augue that until you have bought a dwelling, you should not be regarding any funds as DISPOSABLE, since everyone should try and own ‘a roof over their head’  as early in life as possible. It is very sad to see people who worked hard and were quite independent while they were mature adults, but after retirement, fall into poverty.