Money Talks with Denise Voss

00:00:04: Hey Luxembourg, let's talk about something that really matters.

00:00:07: Your money and your future!

00:00:10: Welcome to Money Talks the podcast that brings you honest chats with familiar faces from Luxemburg.

00:00:18: You'll hear stories of big decisions in life & impersonal finances.

00:00:22: No jargon no fluff just conversations that make sense And get you thinking on how to reach them.

00:00:29: This podcast is bought by Alfie.

00:00:34: Hello everybody and welcome to Money Talks.

00:00:37: This episode is part of our Contribution To The World Investor Week, which a global initiative whose focus this year on investor resilience digital deception and staying alert to scams.

00:00:48: Today I'm joined by Denise Voss.

00:00:51: Denise spent twenty five years with Franklin Templeton one the world's largest global investment management groups.

00:00:57: She's an American who has built much of her professional life in Luxembourg, so I want to talk with her about markets and also culture judgment.

00:01:07: And the habits we develop around money.

00:01:10: Denise welcome to Money Talks!

00:01:11: Thank you, Mihaila.

00:01:12: And thank you so much for inviting me.

00:01:13: this is a key topic from me as well.

00:01:15: now

00:01:16: I know You've been a strong promoter of financial education since many years and i'm glad that we can have today to develop also the personal side investing in your experience.

00:01:27: Let's start with you rather than markets.

00:01:30: Do remember when first started thinking seriously about investing?

00:01:36: Well, I did start in the United States before it came to Luxembourg thirty-five years ago with an employer pension plan.

00:01:42: But really getting serious was when i came to luxembourg.

00:01:46: so Franklin Templeton had an employee stock investment Plan which allowed us to make regular investments into franklin templeton's stock And it just automatically taken from the salary.

00:01:57: So it was very easy.

00:01:58: It was having that access To an investment program.

00:02:02: that was easy?

00:02:03: I think that really got me started.

00:02:06: Okay, I'm understanding then that the workplace has an important role to play.

00:02:11: So you don't necessarily start with a background from your family or own research but having an employer who offers you the opportunity to invest in more automated way is important and this something we see at Luxembourg.

00:02:27: No, it's not mandatory.

00:02:28: And let's face this was in my case I think if i was starting... If I was much younger and started to invest today there would be a lot more access to investing online.

00:02:42: but you know thirty-five years ago or thirty years ago when I started This is where the role of an employer for me was important In terms just making it easy having products and make them easier.

00:02:54: How aware were your about investment opportunities?

00:02:56: It is before you have this chance to invest through your employer.

00:03:00: Well, I have to say that I audited investment funds so I was aware of the existence but also again and maybe a feature from my background being an American there's much more... You need be much more responsible when it comes to investing for future or pension.

00:03:21: for instance The US government actually has Pension government state pension, but it's relatively limited.

00:03:28: so individuals Generally through work plans like that They individuals are sort of required to save if they want to have a decent pension.

00:03:38: How do you perceive the difference in culture between?

00:03:41: The US and Europe where we talk a lot about Europeans having a lot of savings sitting in their Savings account and being more risk averse maybe than the U.S.

00:03:51: citizens, how do you perceive that?

00:03:53: You have been on both sides of The Atlantic

00:03:56: for sure.

00:03:56: I think there's two important issues is also the other issue.

00:04:09: So, I think that plays a bit into the lack of an investing culture because there's no requirement to be responsible for saving your pension.

00:04:31: buying a house, what have you in for their pension?

00:04:33: But your right there is risk adversity.

00:04:36: In Europe and theres alot of money sitting on cash and bank accounts earning well I suppose earning more than it had passed but still with inflation that those earnings are degraded if u will over time.

00:04:51: And i think its the lack of investing culture which again comes apart from this mindset.

00:04:58: state is going to take care from a pension point of view.

00:05:02: It doesn't help, plus let's face it we don't have a lot financial education in schools.

00:05:08: I think its Luxembourg and starting to happen.

00:05:11: there are lots initiatives like money week that helped push but again creating investment culture is still out.

00:05:21: work needed But it will take time in

00:05:25: the US from your experience.

00:05:27: You also have a daughter who has just started her professional life.

00:05:30: Do you start investing or considering?

00:05:31: It as early as your first Professional experience for

00:05:35: sure and she's kind of obsessed about that.

00:05:37: actually now I'm just teasing.

00:05:39: well, I mean i think one of the key key paths to success with investing is starting as early as possible, because of the way time works when it comes to investing.

00:05:53: Say you invest in a bond or a bond fund—you get interest and that interest goes back gets reinvested into the fund.

00:06:01: so I made sure my daughter and niece actually understood.

00:06:06: So with these regular savings plans.

00:06:09: And now my daughter is working and she's adding to her regular savings, so she's topping up for her regular settings.

00:06:16: but

00:06:16: if we look at the world today investing can feel a little bit counterintuitive.

00:06:21: there are worse high levels of public debt in US and Europe as well.

00:06:25: environmental energy risks economic uncertainty everywhere also AI disruption.

00:06:32: Why would someone start investing now rather than wait until things feel a bit more stable?

00:06:39: Well, I think it's important to say that most people are not very good at timing the financial markets.

00:06:45: So when we'd be in time with the question and ask... Now is the best time to invest again small amounts because you don't know what future will bring.

00:06:58: The longer you can invest, the more your money will continue to grow over time.

00:07:02: So if you have money this is the time to start.

00:07:06: so there's no normal moment

00:07:09: or it was No moment.

00:07:10: I mean markets go up they go down but honestly i am relatively well educated in financial concepts and financial Markets But i had zero idea as To what the markets are going to do In the future?

00:07:22: And i think that actually one of the challenges too because When I'm reading financial news and commentary, you know there's a lot of people who sound like they know what the future will bring.

00:07:32: but yes.

00:07:33: They have some expertise But i'm not sure You can always rely on.

00:07:36: you know What do say so?

00:07:39: I read the headlines And I hear That another crisis may be around The corner.

00:07:44: So how Can you manage to keep the focus On long term with all this noise Around us?

00:07:52: Well I guess that is just said.

00:07:53: Try To shut out the noise.

00:07:55: I mean, again having at least a basic understanding of financial concepts being financially literate to a certain extent, understanding financial markets a little bit is helpful and i know it's not easy.

00:08:10: but one does need to shut-out the noise.

00:08:13: And if you come back to basics invest on regular basis.

00:08:20: try make as easily possible.

00:08:21: so don't have think about.

00:08:22: I think that is one of the keys to success.

00:08:25: The other important point too, you know if we look at the markets a lot of the securities and well obviously If You Look At the US Nasdaq Market It's the artificial intelligence companies like Metta.

00:08:41: And What Have You That Are Driving These Markets Higher & Higher?

00:08:45: So what i Think Is Also Important Another Important Financial Concept Is Diversifying what you invest in.

00:08:52: So yes, you might want to invest a bit into artificial intelligence companies but you also wanna make sure that you invest other things.

00:08:59: so when markets do go up or down things going down because you only invested in artificial intelligence for instance.

00:09:08: When you say, You have to automate and diversify there's an element of trust in their Because investors are being asked to trust the markets that at some point they will go up And they also have two trust institutions.

00:09:23: when sometimes rules seem to be questioned or ignored How do you read between the lines?

00:09:32: defy trusted sources of information.

00:09:36: Not easy, I'm saying but you know.

00:09:38: i read the main financial news houses and um...I trust that- I mean try to remain skeptical because I think that's important as well, but I do trust the big ones.

00:09:51: You know?

00:09:51: The Bloomberg, the Barons?

00:09:53: what have you?

00:09:54: where they're providing information and a much of What They Provide is factual Information.

00:09:58: obviously Where it gets so little tricky Is when your...you Know Your on tiktok or something like That And you are listening to somebody who talking about the hottest new product.

00:10:06: So those i don't actually look at Or listen too.

00:10:10: But in todays world this is what people Are looking At.

00:10:14: Having a good amount of skepticism for what you hear is very important.

00:10:20: Probably in your career over decades, in the asset management industry You've been through different market cycles up and down in crisis.

00:10:29: What do YOU do when markets become uncomfortable?

00:10:32: And you don't sleep at night.

00:10:34: Well as I said...I have my regular investment into investment funds, that just happens without me having to take any action at all.

00:10:42: So I forget about it and let this happen.

00:10:45: so very much helps me sleep because again i'm investing when markets prices are high or low.

00:10:57: so where I can invest online shares of companies in other financial products like ETFs, exchange-traded funds.

00:11:04: And that's when it is important to know how much risk I'm willing to take and be able sleep at night.

00:11:10: given the online aspect?

00:11:12: It's...I see how easy it is.

00:11:15: just click!

00:11:17: Click buy!

00:11:18: Click sell!

00:11:19: It isn't easy but you have to know what your financial budget is.

00:11:23: How much money do we need to invest and try to understand your limitations.

00:11:29: And then as I do, um...I actually set kind of a number limit.

00:11:34: so for instance if the price of security that i owned in my online brokerage account is going down don't let myself buy more it because obviously would be good thing have lower cost.

00:11:46: Eventually when I sell

00:11:47: buying on sale

00:11:49: exactly so, I don't i try to set Limits according To the security.

00:11:54: I mean?

00:11:54: Don't I could write it down if I wanted too but you know weather So I will only buy more of x stock If It goes Down by More Than five percent or ten percent Or Twenties percent even Sometimes.

00:12:05: so I tried and that Actually Works for me.

00:12:08: Would you say that the difference between investing on a digital platform and investing with an asset manager in investment funds changes your behavior?

00:12:16: Oh, huge difference.

00:12:17: Yeah exactly You really need to control yourself I would say With the online brokerage account.

00:12:22: And one of the biggest challenges is not just sit there all day and keep opening up the app There are obviously positives and then negatives and dealing with your emotions.

00:12:33: On that i think it's probably hardest part.

00:12:35: Investing has become so much easier.

00:12:37: So digitalization has disrupted and changed access in a way, but also now we have artificial intelligence challenging us again more.

00:12:45: on the one hand it makes Access to information into investing easier while On the other hand It makes it more difficult To spot the scams too.

00:12:54: sometimes the information may be biased.

00:12:57: What's your view of this?

00:12:58: How much will AI help us or hinder our investments?

00:13:02: I wish i had an answer that question.

00:13:04: Ah, if I had to think of one word it would be skepticism.

00:13:08: If you get an email or a text saying do this today or else... Or its free!

00:13:13: That for me maybe that's the old world of skepticism because as you say It is jungle out there and i don't think will become very easier.

00:13:22: Maybe could give us your top three signs.

00:13:25: tell you This Is A Nogo

00:13:27: urgency.

00:13:29: You know, do this today or else you're missing out?

00:13:32: Or there'll be a problem anything that's free.

00:13:35: We promise you ten times by next year That

00:13:38: kind of thing.

00:13:39: but maybe coming back to how to combat it understanding financial concepts like again the impact of inflation diversification investing over time and how that works as well As having basic understanding of financial markets.

00:13:56: I think that would be helpful because at least it allows you to see a statement and say, wait this doesn't seem right.

00:14:02: If you get to that point working with trusted advisors as well?

00:14:06: And maybe trying to just channel the way you invest through just a few places

00:14:14: i.e.,

00:14:14: Through The Investment Fund Company That You Work With or The Online Brokerage Firm

00:14:19: Coming back to your own experience after all these years investing other's investments.

00:14:27: What do you understand today about investing that you wish you had known before when you were younger?

00:14:35: Well, I guess I wish i had started earlier.

00:14:38: How early.

00:14:39: well like...I started with my daughter and my nieces at eighteen With a regular savings plan for them And I funded You know the first couple of years while they were students funded that investment, so I would send money to their bank accounts.

00:14:54: And yeah!

00:14:55: So i wish I had started earlier and also understanding it doesn't have be a lot of money you start with...

00:15:03: What is the single piece advice about investing?

00:15:06: That you find yourself coming back again-and-again?

00:15:10: or maybe the piece of advice your daughter and nieces

00:15:14: gave me?

00:15:17: put all of your eggs in one basket, so that's the diversification story which honestly from a personal perspective I see today is a benefit.

00:15:38: quite helps me sleep at night because I don't see my investment number, you know total investments going down.

00:15:44: So don't bet on one company or in a sector of one region diversify?

00:15:48: Exactly exactly.

00:15:50: and then i think the other thing is that um...I would say time's best friend investing.

00:15:55: That'd be another piece advice.

00:15:58: what

00:15:59: does time mean when you think long term ten years well twenty?

00:16:05: Well it depends upon your investing.

00:16:08: Yeah, the reason for investing is.

00:16:11: So if you're investing to supplement your pension then obviously your time period depends on how old you are when you start investing for that?

00:16:19: If you invest in saving money by an apartment or a house and car.

00:16:24: those are times periods.

00:16:25: so I think this aspect as well of investing why am i investing?

00:16:31: do have particular financial goals.

00:16:34: How long will it take me in theory to reach those goals?

00:16:37: And how much money do I need set aside, again.

00:16:41: That also helps you feel like you have some control as well.

00:16:46: Denise thank for sharing with us your vast experience!

00:16:49: I'm grateful we could learn both from personal experiences and the professional who has built a career in investing.

00:16:56: You've been listening to Money Talks on Alfie Podcast.

00:16:59: Thank you for joining us until next time.

00:17:01: Stay curious.