These days when I tell people that I'm a financial advisor, the first response is "orh you sell insurance one isit?" I usually smile meekly and nod my head and let things be. It's much easier that way.
Fact is, I'm not just an insurance agent. I'm a financial advisor. There are differences. Only when you understand that there are many aspects to your finances other than insurance will you be able to tell the two apart.
So what does personal finance consist of?
1. Cash management
Cash is king. Everybody knows that. But the wise king doesn't hold onto all his assets in terms of cash. How much cash should a person hold for his emergency fund? Where can a person keep his cash? What should a person do with the rest of the money?
2. Budgeting
All companies have a profit and loss statement. They earn and spend money, and they need to keep track of what they earn or spend. We earn and spend money as well, so shouldn't we have a list of our earnings and spendings? You can derive a lot of information from your own budget.
3. Risk management
In life we will all face certain risks. Risk of falling ill, risk of dying before the ripe old age of 65 (sorry but you don't get to even see your CPF money that way), risk of meeting an accident, risk of getting sacked from your job. Can you stomach these risks? Will life be okay if these happen? If not, chances are you need insurance. Insurance can be cheap if you let it be.
4. Goal setting + financial planning
We all have goals we want to achieve in life. We want to buy a car to escape the squeezy MRTs. We want to travel the world. We want our children to have money to study in top notch universities. We want to retire in comfort. These goals are important. Same goes for the money that funds it.
5. Tax planning
Tax planning isn't as complicated here in Singapore, but oftentimes people miss out on a few reliefs here and there, and ways you can reduce on your tax payable.
6. Investment
It's the talk of the town. Everybody rambles on on how you need to invest to grow your wealth and to be rich. How do you go about investing? What's your risk tolerance? Can you stomach such a risk level, or do you crave more?
7. Retirement planning
You're approaching retirement age and you can feel it coming soon. Are you ready for retirement? Will the money in your CPF be enough for you to sustain your retirement lifestyle? How much is enough before you can say you can retire comfortably?
8. Estate planning
The time has come, and you need to split your assets to those that survive you. What would be a good way to go about it? Will a will be sufficient, or are there efficient ways to go about it?
It seems a lot to juggle, but it can be easy if you know how these systems work. Start doing a little thinking today and live an easy life later.
Monday 23 June 2014
Start of new blog!
I've been in the market for years.
I've seen people. Well not tons, but I've seen many people.
As a financial advisor, I walk the streets of Singapore and talk to people of all walks of life. Rich people, poor people, family people, single people, smart people, stubborn people. It didn't hit me at first but slowly it began to seep in. One by one I see common traits amongst us. Bit by bit I repeat the same story to different kinds of people. I refused to accept this as reality for a long time to come, but today I have finally accepted it as part of Singapore and who we are.
We are limited in terms of financial knowledge.
In school we were taught math. We started on math with how Ahmad has 10 apples and how 3 apples were taken by Ah Seng. We know how $5 can buy us 10 pencils, and that each pencil costs 50 cents. We can understand when the teacher says "compound interest for 5 years".
Somehow this concept of math doesn't translate to financial knowledge when we left school to work (of course it doesn't). We are capable of scoring 10/10 for math tests, but we can't understand how the income tax works.
School simply didn't prepare us for this. We didn't know how insurance works. We didn't know how banks can help us grow our money. We didn't know who to approach to work out the loan details. We didn't have an idea what a budget entails. All these "didn't know" costs us money.
Which brings me back to here. Why I want to start this blog.
I am a financial advisor today, and I see the money problems people face. I want to help people out. I want the world to have access to financial knowledge, but there's only one of me. I want to use this blog to share the views and problems common people. People like you and I who go to work to make an honest living, who squeeze in the MRT after work, who dabao dinner from the kopitiam along the way home.
I want to help.
In this blog, I will share with you the daily experiences I face as a financial advisor. I will share articles that I believe will be useful for the common man. I will advise on the financial aspects of life that was simply never taught to us in textbooks.
I hope one day we can all be good in finance.
Start reading.
I've seen people. Well not tons, but I've seen many people.
As a financial advisor, I walk the streets of Singapore and talk to people of all walks of life. Rich people, poor people, family people, single people, smart people, stubborn people. It didn't hit me at first but slowly it began to seep in. One by one I see common traits amongst us. Bit by bit I repeat the same story to different kinds of people. I refused to accept this as reality for a long time to come, but today I have finally accepted it as part of Singapore and who we are.
We are limited in terms of financial knowledge.
In school we were taught math. We started on math with how Ahmad has 10 apples and how 3 apples were taken by Ah Seng. We know how $5 can buy us 10 pencils, and that each pencil costs 50 cents. We can understand when the teacher says "compound interest for 5 years".
Somehow this concept of math doesn't translate to financial knowledge when we left school to work (of course it doesn't). We are capable of scoring 10/10 for math tests, but we can't understand how the income tax works.
School simply didn't prepare us for this. We didn't know how insurance works. We didn't know how banks can help us grow our money. We didn't know who to approach to work out the loan details. We didn't have an idea what a budget entails. All these "didn't know" costs us money.
Which brings me back to here. Why I want to start this blog.
I am a financial advisor today, and I see the money problems people face. I want to help people out. I want the world to have access to financial knowledge, but there's only one of me. I want to use this blog to share the views and problems common people. People like you and I who go to work to make an honest living, who squeeze in the MRT after work, who dabao dinner from the kopitiam along the way home.
I want to help.
In this blog, I will share with you the daily experiences I face as a financial advisor. I will share articles that I believe will be useful for the common man. I will advise on the financial aspects of life that was simply never taught to us in textbooks.
I hope one day we can all be good in finance.
Start reading.
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