March 14, 2012
Our Response to Today’s New York Times Op-Ed
By now, many of you have read the submission in today’s New York Times by a former employee of the firm. Needless to say, we were disappointed to read the assertions made by this individual that do not reflect our values, our culture and how the vast majority of people at Goldman Sachs think about the firm and the work it does on behalf of our clients.
In a company of our size, it is not shocking that some people could feel disgruntled. But that does not and should not represent our firm of more than 30,000 people. Everyone is entitled to his or her opinion. But, it is unfortunate that an individual opinion about Goldman Sachs is amplified in a newspaper and speaks louder than the regular, detailed and intensive feedback you have provided the firm and independent, public surveys of workplace environments.
While I expect you find the words you read today foreign from your own day-to-day experiences, we wanted to remind you what we, as a firm – individually and collectively – think about Goldman Sachs and our client-driven culture.
First, 85 percent of the firm responded to our recent People Survey, which provides the most detailed and comprehensive review to determine how our people feel about Goldman Sachs and the work they do.
And, what do our people think about how we interact with our clients? Across the firm at all levels, 89 percent of you said that that the firm provides exceptional service to them. For the group of nearly 12,000 vice presidents, of which the author of today’s commentary was, that number was similarly high.
Anyone who feels otherwise has available to him or her a mechanism for anonymously expressing their concerns. We are not aware that the writer of the opinion piece expressed misgivings through this avenue, however, if an individual expresses issues, we examine them carefully and we will be doing so in this case.
Our firm has had its share of challenges during and after the financial crisis, but your pride in Goldman Sachs is clear. You’ve not only told us, you have told external surveys.
Just two weeks ago, Goldman Sachs was named one of the best places to work in the United Kingdom, where this employee resides. The firm was the highest placed financial services company for the third consecutive year and was the only one in its peer group to make the top 25.
We are far from perfect, but where the firm has seen a problem, we’ve responded to it seriously and substantively. And we have demonstrated that fact.
It is unfortunate that all of you who worked so hard through a difficult environment over the last few years now have to respond to this. But, our response is best demonstrated in how we really work with and help our clients through our commitment to their long-term interests. That priority has distinguished us in the past, through the financial crisis and today.
Lloyd C. Blankfein
Gary D. Cohn
I rarely visit the banking halls nowadays. Most of my banking transactions are conducted via the Internet and through the ATM machines at my local branch. I have not been to the banking hall for more than six months. If its’ imperative that I must go, it’s either I’m depositing money or probably making one or two enquiries. This has made life easier for me and also for a lot of Nigerians who conduct their banking transactions online. This has also led to multiple passwords and pin codes for the various cards that I carry in my wallet.
After posting my article on retirement, I thought of what happens when a loved one passes on and his/her relatives do not have access to the passwords and pin codes to the bank accounts; what happens in such a situation? So, I ask myself if we’re creating more technological mess for our heirs when we die. I worked briefly in the banking industry and observed that 80% of the dormant accounts were a result of heirs or family members who are not aware of the various accounts the deceased had before his/her untimely death. Getting access to your financial accounts is imperative for your family members if you die, become incapacitated or you’re involved in a ghastly road accident that leaves you and your spouse either dead or paralyzed. Imagine what happens in the event of such a crisis where you find family members running helter skelter to raise funds and thereby incurring a huge amount of debt. For most families in Nigeria, the world virtually comes to a standstill when the breadwinner dies. Imagine what could happen; school fees will be left unpaid, neglected investment accounts could suffer losses, burial expenses will be incurred, financial accounts may never be claimed and the list is endless.Here are some of the things you can do to avert such a crisis:
· Appoint an executor for your financial estate: this could be your brother, sister, parents or even your eldest child so long as he/she is 21years (this is the legal age in Nigeria). Your executor should have your current login password to your online accounts and computer, so that in the event of any sad occurrence, financial decisions can be made on your behalf. You should also make a list of all your assets, debts, mortgages (if any) and pin codes for any cards you may currently hold on an excel spreadsheet. Remember to password this particular file and leave the password in a place your executor can have easy access to.
· Keep your financial documents safe: this includes your account numbers, online IDs and passwords, birth and marriage certificates, email IDs and passwords, pin codes, life insurance papers, will, trust deeds, certificate of occupation in a safe envelope and go down to your local bank branch and keep it in a safe deposit box. Also include answers to secret questions such as mother’s maiden name, your city of birth and your pet’s first name. The banks usually charge an annual fee for such a service. First Bank offers such a service. Also make extra certified copies of all documents relating to your financial estate and keep it in the your executor’s custody. Inform your executor where these documents are kept and of course, write a letter of authority to the bank or lawyer authorizing your executor to act on your behalf in the event of any mishap.
· Keep your executor and children prepared: stash an emergency fund for such an event by making your eldest child or executor a joint signatory to the account, to keep things running smoothly till the details of your financial estate are sorted out.
- Change your budget: you need to have a zero based budget at this stage of your life. With a zero based budget, you start from absolutely essential expenses, then move to other less essentials until you arrive at zero. Sadly, many of us concentrate on less essential expenses while we burden ourselves with a lot of unnecessary financial burden such as extravagant burial ceremonies: wedding ceremonies: aso-ebi e.t.c. Cut all these expenses and plough the money into your retirement savings. You must change your habit at this stage of your life. Do not feel guilty when you say “No” to discretionary expenses.
- Change your job if necessary: this may not sound right to a lot of people, but remember we’re talking about a crash retirement programme. You don’t have the luxury of young age. Better job for this purpose could be the one that gives you a higher pay: the one that gives you more free time to do some personal business or a job that provides you with a better pension. These will help in quickly building your retirement fund.
- Go Private: while I don’t encourage you to utilize your present employer’s time for your private business, you must make a better use of all your free time. Think about starting a private business on the side to enhance your income. However, don’t cheat your employer. With a private business, you secure two sources of income for yourself. The good thing about this is that you can eventually retire into your private business and fight boredom on retirement.
- Retire Late: assuming you’re not cut out for entrepreneurship, you may consider retiring later than the standard retirement age. The longer you stay, the bigger your retirement benefit is likely to be. However, this is not the best option and in any case, your employer is not likely to retain you till the old age of 70 – 75.
- Mind your health: I can’t say this enough. You are not getting any younger. Mind what you eat and what you do at this stage. Medical expenses can be quite high for people in your category and it’s not advisable for this to erode your retirement savings. Take medical advice on time and remember prevention is better than cure.
- Be Realistic: when making your projections and assumptions, be as realistic as possible. Create a realistic dream for yourself. Why, for instance, would you want to ride a hummer jeep at retirement when your retirement fund can only afford a Honda City? If you can, go ahead. That’s what retirement is all about – good life. But if you can’t, why build a castle in the air?
One of the few things people worry about is the future in terms of retirement especially if you’re five years from retirement. I wrote an earlier article on retirement giving an insight into what individuals can do to buy back a bit of the time they had earlier wasted due to ignorance and non access to relevant information that may assist such individuals.
How do you know if you’re eligible for this program? You’re eligible:
· If you’re worried about your age. You’re most likely to check the mirror every morning to count the number of new gray hairs or wrinkles you acquired while asleep the previous night.
· You’re concerned about the little assets you possess and continuously ask yourself “what can I do?”
· You happen to be one of those who had lived a good life in the past, you could have additional emotional problem of self-blame. The common “if I had known” thought continuously haunt you.
If you’re in this position, all hope is not yet lost. Although there’s little you can do about your past, there’s a lot you can still do before retirement. This is not the time to berate yourself for what you did wrong or right. You need to take proactive action by doing the following:
Check your needs: you need to figure out what you’ll need on retirement and compare with what you will have in retirement. You also need to decide the sum that will be adequate for your living expenses by comparing what your present living expenses are right now. If there are some items that are not really necessary, this is the time to ask yourself if you can do without these items. Learn to differentiate between your needs and wants. Also don’t count on whatever you may receive from your children in form of financial assistance cos this may not be a regular or constant assistance. It has always been an age long belief of many Africans that their children will take care of them in old age. Often, this is rarely the case.
Save! Save! Save: I can say this a million times. You must save every kobo and naira you can, however small. Let this become your daily chore. You are no longer 25, 30 or 40 years of age; retirement is now around the corner. Saving should be your priority. You can do this via Additional Voluntary Contribution to your Retirement Savings Account (RSA). Ask your employer to increase your personal contribution to 10% or 15%. It is no longer a case of convenience but that of compulsion. Let this be your new way of life even if you’re just entering the labour market. Your latter years will be spent in bliss and peace.
Since the Pension Act 2004, many workers are still at a loss about their future, especially in relation to pension. Pension is a steady income given to a peron, usuallly after retirement or the payments a person recieves upon retirment, usually under pre-determined legal terms. In the past, many pensioners died without receiving their pension, and others gave up completely onit because of the stress they had to go through waiting to collect the sum accruable. More often than not, the pensions were never paid, because it was a defined benefit scheme, solely borne by one part – the emloyer.
The new scheme, which is a defined contribution plan, provides for an individual account for each participant, and for benefits based solely on the amount contributed to the acount, plus or minus income gains, expenses and losses allocated to the account. Contributions are paid into an individual account for each member. Because of the shared responsibility, defined contribution plans have become more widespread all over the world in recent years, and are now the dominant form of plan in many countries. But in spite of the benefits, many workers are still not yet sure whether their future is secured under the new contriutory pension scheme.
One of the ways to ensure this right is for workers to demand a quarterly statement of their accounts. When I decided to pitch my retirement fund with Pensions Alliance, I made it mandatory that my statemtents were to be sent in as at when due. For the first six months, they sent in timely updates but after these probationary period, I stopped receiving any updates. One of the few things I did was to call up the customer service line and ask to speak with their manager because in situations like this, you need to speak with the decisio maker and not the person who carries out the decisions. I spoke with her and explained how wrong it was for an organization like thiers not to send in timely reports to its’clients, upon which she apologised and said they had actually been sending it to my organizations headoffice but I was not receiving it. To resolve this dilemma, I wrote a letter via email asking the organization to send my pension statement account to my email box. Since then I’ve been reciving timely updates and have a good grasp of the income my fund is generating.
The quarterly account should indicate the profits made during the period, through investment with your money. Contributors must demand for a quarterly statements of their pension accounts from the PFAs cos let’s face it, if you can ask for your bank statements, you can do the same with your monthly pension contributions.