Here’s where the royal family gets their money

queen elizabeth christmas 2008A little summary:

• It costs about $368 million a year to run the British monarchy.
• Some of that money comes from the queen’s private investments.
• But a substantial chunk — about $48 million last year — comes from the British government. 

Royal families don’t come cheap: The Telegraph reports that it costs about £300 million (that’s about $368 million USD at current conversion rates) to run the British monarchy each year. So how do Queen Elizabeth II and her brood acquire such a sum?

Their funding actually comes from a few different sources, both public and private. Here’s how it breaks down.

Every year, the Queen gets a chunk of cash called the Sovereign Grant.

It comes from the treasury and it’s funded by taxpayers, according to the BBC.

The basic agreement is that the Queen gets the grant in exchange for surrendering all profits from the Crown Estate — the Royal family’s massive portfolio of properties — to the government. Every year, the Queen is given an amount of money equivalent to 15% of the Crown Estate’s profits from two years ago.

For example: In 2013, the Crown Estate generated a profit of £267.1 million (about $325.8 million). That means, in 2015, the Queen’s Sovereign Grant was 15% of that total — that’s £40.1 million (or $48.9 million).Buckingham Palace London

The Sovereign Grant pays for the family’s travel, palace upkeep and utilities, and royal employee payroll, according to official royal family financial reports. But the Telegraph notes that at the grant doesn’t cover costs of security and royal ceremonies — that money comes from a few other places.

The Queen’s private income is called the Privy Purse.

That money comes from the Duchy of Lancaster — a portfolio of land and other assets that’s been in the royal family for hundreds of years. It includes 18,433 hectares of land and is made up of residential, commercial, and agricultural properties.

From 2015 to 2016, it generated £17.8 million (about $21.7 million). According to the royal family website, this sum helps with costs not covered by the Sovereign Grant — namely, it’s used to pay “expenses incurred by other members of the royal family.”

The Queen also has a personal fortune estimated to be about £340 million (about $414.7 million). She outright owns Balmoral and Sandringham Estates, which she inherited from her father, and also has a valuable artwork collection, CNN reports.

It’s nothing to sneeze at, but the Queen is by no means the richest person in Britain. For the past two years, she’s failed to make the Sunday Times’s list of the top 300 wealthiest Brits. kate and william christmas 2011

The Duchy of Cornwall— yet another suite of properties owned by the royal family — covers the expenses of the Prince of Wales (that’s the Queen’s oldest son, Charles) and his heirs. That means Harry, William and Kate, and George and Charlotte are all covered by the Duchy of Cornwall, too.

The total income of the Duchy for the 2015–2016 fiscal year was £33.5 million (about $40.8 million). No wonder Prince George has such a fluffy bathrobe!Image result for british royal family

Want to learn more about royal family finances? Check out their official website.


How your body language can change your life.

Body language affects how others see us, but it may also change how we see ourselves. Social psychologist Amy Cuddy shows how “power posing” — standing in a posture of confidence, even when we don’t feel confident — can affect testosterone and cortisol levels in the brain, and might even have an impact on our chances for success.


How Whatsapp makes money?

whatsapp_0.jpgWhatsApp was founded in 2009 by Brian Acton and Jan Koum as an alternative to pricey SMS services. The app allows users to upload their contact book and message anyone who has the app installed at no cost. It is available for iPhones, Androids, Blackberries, Windows Phones, Nokia (NOK) phones and, most recently, desktops.

Facebook (FB) purchased WhatsApp in February 2014 for approximately $19 billion, and according to the 2014 Facebook Form 10-Q, in the nine months preceding September 30, 2014, WhatsApp generated revenue of $1,289,000. How is WhatsApp making its money?

$1 at a time

The short answer is $1 at a time. In some countries, the app costs about $1 to download; in others, the first year is free but, each subsequent year costs $1. With over 700 million active users and about 1 million new users per day, yearly revenue can be estimated at $700 million per year.

Facebook’s Form 10-Q admits that the company “[monetizes] WhatsApp in only a very limited fashion, and [they] may not be successful in [their] efforts to generate meaningful revenue from WhatsApp over the long term.” So while the company doesn’t currently have ads or other forms of income, their position could change over time.

Other SMS apps

Outside of America, where sending text messages is more expensive, SMS apps are popular and have successfully monetized. WeChat – the popular Chinese SMS app has ads as well as online games. The company boasted $924 million in revenue in the third quarter of 2014, down from $949 million in Q2, with only 438.2 million users.

KakaoTalk, a South Korean SMS app, has 48 million users and $190 million in 2013 revenue. The app makes money from online games, advertising, and from selling emoticons and stickers.

At $2.11 (WeChat) and $3.95 (KakaoTalk) in revenue per user, per year, WhatsApp can earn between $1.47-2.77 billion per year by adopting the competition’s monetization policies. Analysts have calculated that, long-term, WhatsApp could generate $2.50 in yearly revenue per user with about 2 billion users (about $5 billion per year).

Focusing on growth

WhatsApp is adding around a million users per day, mostly in Latin America, India and Europe. With SMS apps, growth is exponential – when one person in a social group downloads and advocates using the app, many new users download the app in order to communicate with the original person. These new users then encourage other members of their other social groups to use the app.

By increasing market penetration, the app becomes indispensable and the user base grows. As the user base grows, not only does the subscription service of $1/year bring in substantial revenue but advertising and alternative forms of monetization create hearty revenue.

Is it really about the money though?

Industry insiders have speculated that part of the rationale behind acquiring WhatsApp was for Facebook to access user’s behavioral data and personal information.

With location sharing data, 30 billion messages sent per day, and access to users’ entire contact lists, Facebook has access to a ton of personal information – all uploaded and saved on its servers. While Mark Zuckerberg promises that this data won’t be used to improve consumer targeting in Facebook ads, it still raises questions about how private our data really is.

The Bottom Line

Whether you believe that Facebook overpaid for WhatsApp or not, the fact is that the app has a small and growing revenue stream with lots of room to grow. Will the SNS giant aggressively monetize like other SMS apps have done or use it for another purpose? Only time will tell.

Source: Investopedia

How did Warren Buffett get started in business?

quote-the-best-investment-you-can-make-is-an-investment-in-yourself-the-more-you-learn-the-warren-buffett-84-92-34.jpgWarren Buffett may have been born with business in his blood. He purchased his first stock when he was 11 years old, and worked in his family’s grocery store in Omaha. His father, Howard Buffett, owned a small brokerage, and Warren would spend his days watching what investors were doing and listening to what they said. As a teenager, he took odd jobs, from washing cars to delivering newspapers, using his savings to purchase several pinball machines that he placed in local businesses.

His entrepreneurial successes as a youth did not immediately translate into a desire to attend college. His father pressed him to continue his education, with Buffett reluctantly agreeing to attend the University of Pennsylvania. He then transferred to the University of Nebraska, where he graduated with a degree in business in three years.

After being rejected by the Harvard Business School, he enrolled in graduate studies at Columbia Business School. While there, he was taught by Benjamin Graham and David Dodd, both well-known securities analysts. Buffett was a fan of Graham’s book “The Intelligent Investor,” and it was under Graham that Buffett learned the fundamentals of value investing.

The Buffett that modern investors admire almost wasn’t. When he graduated from Columbia he intended to work on Wall Street, but Graham convinced him to make another career choice. Back in Omaha, Buffett worked as a stockbroker and opened several partnerships. The size of the investing partnerships grew substantially, and by the time he was 31 he was a millionaire.

It was at this point – in 1961 – that Buffett’s sights turned to directly investing in businesses. He made a $1 million investment in a windmill manufacturing company, and the next year in a bottling company. Buffett used the value investing techniques he learned in school, as well as his knack for understanding the general business environment, to find bargains on the stock market. Looking for new opportunities, he discovered a textile manufacturing firm called Berkshire Hathaway (BRK.A), and began buying shares in it. He later took control of the company in 1965. Like Berkshire Hathaway, he made some other good investments, like American Express (AXP), a company that doubled in price within two years of his initial.

Warren Buffett’s investments weren’t always successful, but they were well thought out and followed value principles. By keeping an eye out for new opportunities and sticking to a consistent strategy, Buffet and the textile company he acquired long ago are considered by many to be one of the most successful investing stories of all time.

Source: Inestopedia