What is Financial Planning?
Financial planning is a systematic approach about devising and preparing strategies to maximize your existing financial resources by utilizing financial tools to achieve your financial goals. It is an interactive and ongoing process shaped around your financial life cycle needs, for example, your children's education, buying your dream home, supporting your ageing parents and preparing for your retirement.
Financial planning is simple mathematics. There are 3 major components :
- Financial Resources (FR)
- Financial Tools (FT)
- Financial Goals (FG)
Financial Planning: FR + FT = FG
Why It's Critical To Have A "Financial Roadmap"
It's All About Achieving The Great Goals Of Life!
Goals and Objectives
- What is really important to me (money, wealth, happiness, family, kids, travel, etc)?
- What special dreams do I have that I want to achieve before I die?
- Am I successful in managing against an annual or monthly cash flow budget?
- How do I balance spending today vs. saving for tomorrow?
- When do I want to retire? Is Singapore a good place for retirement?
Retirement Planning
- What annual income do I want in retirement? How will inflation impact that number?
- How much of a retirement nest-egg do I need so that my spouse and I can't outlive our income needs, given that one or both of us may live 30 years in retirement?
- Will my CPF contribution be sufficient for my retirement needs in Singapore?
Investment Planning and Asset Allocation
- Will my current assets grow to a level to meet my wealth needs?
- Is my portfolio appropriately diversified?
- Have I identified an asset allocation and investment management philosophy that will allow me to accumulate wealth within the risk parameters that I'm comfortable with?
- Do I have adequate emergency savings should I lose my job, become disabled, etc?
Insurance and Risk Management
- Do I have sufficient health, disability, liability, homeowner, and automobile insurance?
- Will my medisave be enough for my medical needs?
- Do I have adequate life insurance to protect my family?
- Should I consider long-term care insurance?
- What would happen if I became disabled and couldn't work?
Any enquiries, please email to ASKvonz