Advice needed

[skybluegerald]

Am a Fresh grad, started working last year.

Currently looking for places to invest some of my savings. any suggestions?

**sorry for the vague question** but i really have no idea what to do now so that i can be financially stable when am older.

 

[Frost45]

Too bad i dont know as well

 

[dendii]

If you are unsure, I personally think investing into the STI ETF is a good place to start off.

Or actually, before even that, if you salary is sufficient for the requirements, put it into the accounts like UOB One, OCBC 360 etc to build up your liquidity funds first while stocking up your capital for investment.

Ideally, you should have 3-6 months of savings first for liquidity purposes/emergency funds before you look at investing some of your savings.

Just to add, get your basic insurance planning done up first as well before looking at saving followed by investment.

 

[Maeda_Toshiie]

Am a Fresh grad, started working last year.

Currently looking for places to invest some of my savings. any suggestions?

**sorry for the vague question** but i really have no idea what to do now so that i can be financially stable when am older.

I think I need to make a template response one day...

A few financial planning points:

1. Current age? (I'm not going to ask about your health conditions and any vices.) What's your saving rate?

2. Saved up your emergency cash?

3. Current insurance plans (of all sorts) in existence? Do you have a hospitalization plan (plain vanilla Medishield at the minimum) ? Term insurance (necessity of this depends on your dependents / committments) ?

4. Any debts (short term or long term)?

5. Other present or forseeable financial committments?

6. Goals and time frame of investing? (For marriage, housing, car, kids, business, retirement, early retirement (or F U money), YOLO, etc)

7. How much do you intend to invest? Current lump sum? Continued funneling of funds towards investing?

8. What is your risk tolerance? What is your risk appetite? (note that they are different)

 

[alexchia01]

Am a Fresh grad, started working last year.

Currently looking for places to invest some of my savings. any suggestions?

**sorry for the vague question** but i really have no idea what to do now so that i can be financially stable when am older.

Don't do any investment yet.

Spend the next few years learn about investing.

Important: Learn about main stream investment and AVOID all alternative investment. 99% Alternative investment are Scams.

 

[akwl88]

Do not mix insurance with investment!

 

[doody_]

Am a Fresh grad, started working last year.

Currently looking for places to invest some of my savings. any suggestions?

**sorry for the vague question** but i really have no idea what to do now so that i can be financially stable when am older.

Fresh grad should get the basics right.

1. Have you covered yourself under health insurance? It's the best time to get covered, before you develop any conditions which will end up excluded.

2. Have you covered yourself with life insurance? Could be term or whole life. 2 ways of looking at this. Some use it to cover any outstanding expenses they may have if they suddenly pass away (eg house). In this case, if you have no outstanding loans, don't need so much coverage. Some use it as a replacement for the future income they could have earned if they didn't pass away (eg for supporting parents). In this case, depends how much you think will be enough, eg 2k x 30 years = 720k.

3. Have you saved a few months of emergency cash? Personally I think this isn't a big deal for fresh grads, can take your time to slowly accumulate. At the start of your career you don't have much expenses anyway, even if touch wood lose job you can still survive while looking for another one. It's more important for older folks with loan repayments.


After you taken care of yourself, then you can start thinking how to build your wealth.

 

[satayxp]

young n fresh grad just started working the main thing is to build capital
i.e. save or earn more to 1st build that capital tt will serve as emergency cash
den 2nd build capital for investment.
for insurance basic medishield life is enough.. no need more as insurance is basically an expense

 

[Feeshball]

I'm a fresh graduate as well, just started work in January.
Also been reading up on savings/investments and have been slowly trawling through the posts in money mind.

What I've learnt generally is that for fresh grads, you should aim to save and pay off your debts first (i.e. study loan), while having enough money to get yourself appropriately insured (I'm assuming since still young, still without much health problems yet)

Since still student, should be able to save some money for your emergency funds as well, I guess for students don't matter that much but still good to save like maybe a month's worth to survive if out of job, etc.

It is only after adequately securing yourself first (insurance, emergency savings) that you should start to touch that pot of money you put aside every paycheck for investments. Do also note that you should probably pay of any loans asap before using up all your money. Money can slowly earn but loan need pay off before the interest robs you.

Read the forums for information and knowledge while saving up (what I'm doing right now!) Invest only within your comfortable means.

 

[soneat]

As a fresh grad, the things that you have most are time and opportunities. Do try your best to climb up the ladder as fast as possible and reach the state you aspire to be. Note: It does not mean one has to necessarily become the top salary earner. Once you reach the state whereby further salary increment will no longer motivate you to work harder or longer - you know you have reached your personal optimum state.

So in the mean time.
1. Clear all debts. Ensure no debts.
2. Get optimally insured. Minimally H&S and a term plan till say age 65. If your starting salary is sufficiently high, you might want to consider a limited pay whole life CI plan.
3. Apart from "emergency cash", build up two pools of money - one for housing and one for investment. You would want to be able to take opportunity to get into real estate when the prices are low/lower.

 

[BBCWatcher]

2. Get optimally insured.

Yes....

Minimally H&S and a term plan till say age 65. If your starting salary is sufficiently high, you might want to consider a limited pay whole life CI plan.

I disagree with this advice.

(a) You buy life insurance -- preferably simple term life insurance -- when you have one or more dependents, and when you want to protect that dependent's lifestyle if you were to die too early, and when you cannot adequately self-insure. That's not most people who are starting their working careers, since they don't have dependents. (No spouse, no children.) And you should "never" combine investment products with insurance products, so the whole life idea I disagree with too even when life insurance makes sense. (Very rare exceptions aside.)

(b) Disability income insurance helps protect yourself (and dependents if you have them, but also yourself). It pays a monthly benefit in the event you're unable to work due to a disability.

Disability income insurance is entirely appropriate here, but life insurance, no. (Unless there's at least one dependent.)

 

[01asdf]

Yes....


I disagree with this advice.

(a) You buy life insurance -- preferably simple term life insurance -- when you have one or more dependents, and when you want to protect that dependent's lifestyle if you were to die too early, and when you cannot adequately self-insure. That's not most people who are starting their working careers, since they don't have dependents. (No spouse, no children.) And you should "never" combine investment products with insurance products, so the whole life idea I disagree with too even when life insurance makes sense. (Very rare exceptions aside.)

(b) Disability income insurance helps protect yourself (and dependents if you have them, but also yourself). It pays a monthly benefit in the event you're unable to work due to a disability.

Disability income insurance is entirely appropriate here, but life insurance, no. (Unless there's at least one dependent.)

CI is not life ...

 

[soneat]

Life insurance can be WHOLE Life or TERM LIFE.
- Whole life means the coverage is for the entire life but for some insurer, the definition is till 99 years old.
- Term life means coverage is for the stipulated period.

Death, TPD, CI, Early CI are the possible events that one wish to be covered.

No two person's situation is similar and hence the solution for financial protection is unique. It's really up to individual to take responsibility to think and decide what's is best for himself or herself.

 

[deepblueli]

Yes....


I disagree with this advice.

(a) You buy life insurance -- preferably simple term life insurance -- when you have one or more dependents, and when you want to protect that dependent's lifestyle if you were to die too early, and when you cannot adequately self-insure. That's not most people who are starting their working careers, since they don't have dependents. (No spouse, no children.) And you should "never" combine investment products with insurance products, so the whole life idea I disagree with too even when life insurance makes sense. (Very rare exceptions aside.)

(b) Disability income insurance helps protect yourself (and dependents if you have them, but also yourself). It pays a monthly benefit in the event you're unable to work due to a disability.

Disability income insurance is entirely appropriate here, but life insurance, no. (Unless there's at least one dependent.)

IMO, life insurance doesn't just cover for dependent but also your expenses when you are down with CI.

Wholelife with CI makes sense to provide basic CI coverage for the whole life.
Wholelife plan isn't for investment purpose.

 

[soneat]

Just to further "dissect" the following:
Get optimally insured. Minimally H&S and a term plan till say age 65. If your starting salary is sufficiently high, you might want to consider a limited pay whole life CI plan.

Keyword here is optimally. How much is optimal? One has to take responsibility for himself or herself.
i) Term plan.
Duration - Till 60 is correct? Till 65 is correct? Till 70 is correct? Some may wish to cover till his/her dependant finish university. Some may wish to over till his/her mortgage loan is fully paid.
Amount - 10 x Salary? S$500K? S$800k? S$1m? One needs to take into account of large sum discount as well as a S$1m cover may cost the same as S$800K.
ii) Limited premium whole life CI plan. This is costly and this is why I mentioned only IF the salary is sufficiently high. Sure...one can build up lots of equities, excellent financial plans etc etc but just imagine at the time when you are >70 and fulfilling the conditions to trigger a claim. That's a moment when one is potentially fragile, alone and depress. Would it be easier to claim from the policy? Would one still have the mood to look at stocks, bonds, share and to decide/think/strategise what to sell, when to sell, how to sell etc? The mental state for a sickly >70 yo person vs a healthy 20/30/40 or even 50 person is different. Now I am not suggesting a huge CI cover as CI is also not a guaranteed event but some CI cover would help to tide over a tough period.

Again, this is just sharing a perspective.

 

[BBCWatcher]

I understand what critical illness (CI) and whole life are. Disability income insurance is appropriate in these circumstances. CI, less so, but DI is more important. Life insurance of any sort...to whom? There are no dependents in these typical circumstances.

 

[Yachtmaster]

Wrong place to start. Lol

Go kinokuniya and get a book.

Am a Fresh grad, started working last year.

Currently looking for places to invest some of my savings. any suggestions?

**sorry for the vague question** but i really have no idea what to do now so that i can be financially stable when am older.

 

[iamveryguailan]

Me a fresh grad soon too, and I'm gonna take these steps.

Your financial steps really depends on how much you have. A person starting off with 10k savings and a 30k loan will have to approach it differently from someone with say 100k savings and no student loan, or someone who graduates with 500k etc. Assuming you are a guy and work part time during uni, perhaps you may have 30k-50k upon graduation.

First thing I would do is to clear off any student loan if any. The loan interest is high at 4.75%-5%. While some REITs may offer such or slightly higher returns, the difference is negligible to make it worthwhile. Plus, its psychologically relieving to be cleared of such debt fast. If you have a 30k debt, you will be left with 10k-20k after paying it off. I would keep 5k as an emergency fund, which should be enough to last me 6-9 months of key expenses without severely lowering my current lifestyle. Remaining 5k-15k, you can either start a POSB Investsaver plan with 500-1000 per month for a start. Also, settle your insurance especially term and medical insurance. Falling sick in SG is not cheap, and a simple surgery can cost a few k.

I would also put some money into CPF, if its money i wont even need to use or money that will make a difference to me. For example, if you have 200k, putting 2k-5k into CPF wouldnt make any difference at all

 

[deepblueli]

I understand what critical illness (CI) and whole life are. Disability income insurance is appropriate in these circumstances. CI, less so, but DI is more important. Life insurance of any sort...to whom? There are no dependents in these typical circumstances.

How DI works after the retirement? Does it cover as much conditions as CI in life plan? If I am not wrong, DI is like term, you need to pay every year to get coverage.

 

[soneat]

IMHO, there's some very serious stereotyping -> Whole life = Mixing Protection with Investment.

If the intention of buying a whole life policy is for investment, that's obviously not right. The primary purpose of insurance should be for financial protection in certain designated events. Hence for people who are buying whole life insurance, the intention should be to have a protection for life.

And this bring me to the second point. Different people have different perspective on insurable interest. Some wants to be insured for every possible thing and some don't even view an IP shield plan as necessary. By simply saying once a person has retired, one should already have invested and earn that pot of Gold, have no more dependants etc is also simplistic. If things are so simple such that everyone can follow this blueprint and emerge successful, there will not be any poor people in SG.

So in summary, primary purpose of insurance should be for financial protection in times of need. One must take responsibility to understand how much, how long and for what events. There is no one size fits all but generally the undisputed consensus is H&S is a must and a finite term plan covering death/tpd is essential. Anything else will depend on individual's circumstances and pocket.