6 Avoidable Mistakes When Saving Money

Here are some common mistakes when saving money

There’s a saying that goes like this, “save your money today and it will save you tomorrow”. It sounds easy right? Just two simple steps: 1) put money somewhere, like an account, 2) repeat step 1. While simple in theory, saving effectively is monumentally hard. More so when there are so many things to pay for, like bills, leisure, travel, etc. In this article, fundMyLife shares avoidable mistakes when saving money, and how you can avoid them.

#1 Not having a goal and a plan

One of the most common mistakes when saving money is you do it without a goal and a plan. It’s one thing to know that you must save, but it’s another to know what you are saving for.

The goal is a destination, whereas the plan will help you to get there. For example, you want a car that costs $100,000 in 10 years. We know it’s not that cheap, but bear with us. Not counting inflation, you will need to save $10,000/year, and $833.33/month. To put it simply, the goal is getting the car, getting it there by saving $833.33 is your plan. By the way, this is for illustration’s sake – typically you’d take a loan for your car anyways.

Without a goal to work towards to, you’ll eventually question why you’re saving in the first place. Without that motivation, you will soon fritter away that money. Saving towards retirement is a good goal, as is saving towards a possession that you wish to have. The important thing is to have a goal to work towards to, and a plan to help you get there.

As Friedrich Nietzche would say, “he who has a why to live can bear almost any how”.

#2 Lacking the discipline to save

Now that you have a goal to work towards to, it’s time to put it into action. If you don’t summon the discipline to start, you will never get anywhere despite the best of plans. In addition, if you don’t summon the discipline to regularly save after starting, it is hard to maintain it over a long period of time.

Make it a habit to save regularly. Habits can be a powerful thing – as the saying goes, “we first make our habits, and then our habits make us.

#3 Not tracking your expenditure

Tangential, but equally important. To have enough to save every month, you’d need to be aware of what you’re spending on. Imagine, if your spending is uncontrolled, you’d be unable to have enough at the end for savings.

There are apps available to help you track your expenses so that you have enough for savings. We highly recommend the Seedly app – it’s been around for a while, together with strong community support online on their website.

#4 You spend as soon as you see a pile of money

After a while, you’ll soon see a pool of money in your account. Delighted, you think it’s okay just to take a little bit for some expenditure. Say, a vacation to reward yourself for that good job accumulating your money. While we advocate living life well, being able to take a little means you are also able to take a lot out of the account. Soon, you might find yourself in square one.

There are two ways people save in general. Firstly, spend first then save. Secondly, save first then spend. The former allows you to get your expenses settled, whereas the latter way lets you meet your saving goals first. To avoid finding yourself in square one, regardless of how your save, make sure you split your money further into different pots. Instead of just two pots, i.e. expenses and savings, you can split your savings category further into travel, retirement, etc. That way, you keep your savings pots separate and do not risk overspending.

#5 …or you are just really terrible at saving

What if, despite all of the methods described above to avoid the mistakes when saving money, you still have trouble with it? When you’re terrible at saving money, it’s time to consider savings plan, or an endowment. The tenure period of an endowment fund means you won’t be able to touch any of the money that you put. However, it’s important to not lock up ALL your money in there, lest you need the money for unforeseen emergencies in the future. This requires the help of a good financial adviser.

Alternatively, you can consider a fixed deposit – the fixed deposit usually has a decent interest rate, depending on how long you decide to lock up your money. In addition, the account penalizes you for prematurely taking the money out by removing the interest rate. This forces you to think long and hard before withdrawing from your fixed deposit.

#6 Forgetting that inflation exists

Last but not least of the many mistakes when saving money, people often forget that inflation exists. In fact, it is one of the deadliest mistakes when saving money. At best, if the interest rate of your savings account is the same as the inflation rate, you’re just keeping up and not growing your money. On the other hand, if you happen to pick a low interest rate savings account, the real value of your money will decrease over time. Imagine saving up money that decreases in value over time due to the difference in interest rate and inflation.

To avoid this, you will need to save additional money just to adjust for inflation. Alternatively, you’ll have no choice but to invest a portion of your money so that it grows.

Connect with fundMyLife financial advisers today!

Hopefully, you are more acquainted with the most common mistakes when saving money. A lot of these problems can be avoided if you have a good financial adviser. He/she can serve as a sounding board and a friend as you travel in your journey to achieve sound finances.

Haven’t found a good financial adviser? Worry not – fundMyLife has your back. You can connect with our panel of experienced and awesome financial advisers, curated by us. If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our awesome financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

4 Things To Consider During Your Financial Review With Your Adviser

Think of these when doing your financial review

To ensure that you’re in the pink of health, you pay a visit to the doctor for a body checkup. The doctor makes a few notes, asks a few questions, and makes recommendations based on his/her observation. Analogously, a financial health checkup involves going to your financial adviser for a financial review. Financial reviews often get a bad rep for being an opportunity for financial advisers to sell more products. How would you know if you’re in the pink of financial health if you don’t do a checkup? In this article, fundMyLife proposes things to consider when you are doing your financial review with your financial adviser. Having these things in mind will help you maximize your session with your financial adviser.

#1 Updating your adviser on any short-term/long-term life changes

As cliched as it sounds, your financial needs do change over time. Typically, entering new life stages require a financial review because of cash-flow changes. For example, if you got into a relationship and are considering marriage, you will need to work with your adviser to come up with a plan for it. Another example is that you might want to start a business, which means your personal cash-flow will change. In short, as you proceed in life your goals will change as well. You are not the you from the year before – you’re wiser, smarter, and have more perspective than before.

It’s better to inform your financial adviser early, than to wait until it’s too late before informing him/her that you’re in financial trouble.

#2 What else do I need to watch out for/How can I do better?

Experienced financial advisers typically have clients who may experience the same life stage as you. As such, they are in the best position to prescribe not just financial advice, but life advice in general.

If you find yourself in want of more cash, a financial adviser can also sit down with you and examine how you’ve been spending. Furthermore, an outsider’s pair of eyes into your finances provides fresh perspective on how you’re spending your money. It’s hard to figure out where your money went, if you did not track it properly. You might also want to see if you’re on track to saving your emergency fund, for rainy days.

#3 How are my investments coming along?

If you’re a hands-off kind of person, it is all the more important that you ask about your investments when you are doing your financial review. Doing a regular financial review helps you keep a bird’s-eye view on whether your money is doing what it is supposed to be doing. If your returns are unsatisfactory, it’s a good time to get advice on where to allocate your money to next.

Note: for those who purchased investment-linked products, it is useful to look at your current sub-fund returns. If it’s performing well, all is good. However, if it isn’t, it might be time to choose another sub-fund. Another thing is to balance out your investment and protection components, since the protection component increases in cost over time. The worst thing about ILP is that sometimes you notice the signs too late and your returns have already disappeared.

#4 Am I on track to retirement?

In our previous article on retirement planning, we mentioned that the journey to retirement is fraught with many roadblocks. As such, it is important to identify existing roadblocks and anticipate future ones early. During your financial review, you should ask your financial adviser if you’re on track to retirement. You will probably need to review your current debts, e.g., credit card debts, loans, mortgage, etc, to identify any possible signs of danger.

Connect with fundMyLife financial advisers today!

We hope this article helped in setting a level of expectation when it comes to reviewing your finances with your financial adviser. And if all goes well, congratulations! Time to carry on for another year, and maintain your financial discipline.

What’s this? You don’t have a financial adviser yet?

Gosh, it’s time to connect with one! Worry not – fundMyLife has your back. You can connect with our panel of experienced and awesome financial advisers, curated by us. If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our awesome financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

5 Ways To Recover Financially After A Divorce

How to recover financially after a divorce

We previously wrote about what you need to do when you get married. However, life does not always go your way and you might find yourself needing to divorce. Divorce is an emotionally and mentally draining process that involves many parties. More importantly, what happens after is a big financial change in your life. In this article, fundMyLife shares tips on how you recover financially after a divorce.

#1 Step up

If you were the one handling the household expenditure and finances, you should have less trouble managing your finances post-divorce. However, if you’ve always let your now ex-partner handle things, you’ll have to step up to take charge of your own finances again.

The difficulty depends on how dependent you were on the other partner for keeping track of finances. Fret not, there are plenty of tools out there. It ranges from simple things like an Excel spreadsheet, to finance tracking apps like Seedly. You’ll also need to read up on personal finance from media sites like DollarsAndSense, SG Budget Babe, and even our own blog posts.

#2 Review your expenditure

As mentioned, make sure you keep track of your expenses so that you know where and what you’re spending on. If you track your expenses, you can make better plans for where your money go. Then again, this is a generally good habit to have when it comes to personal finances for everyone.

#3 Set up a budget

Since there is the possible transition from a double-income household to single-household one, you will have to redo your budget to reflect this change. You’ll have to cut back on luxuries and set a realistic budget.

Also, expect your expenses to increase slightly. In the past, you might have purchased groceries in bulk for family use. Now, you purchase things only for yourself. However, some expenses don’t end after a divorce. If you have a child, you still need to pay child support. Similarly, if you two shared a pet and you decided to take custody of the pet, you’d be responsible for keeping it and its upkeep.

#4 (Re)gain financial independence

If both of you and your ex-partner were working before the divorce, you’re less vulnerable since you’re financially independent. However, if you quit the workforce to be the homemaker, going back to the workforce may be tough. This is more so if you haven’t been working for a while.

To address this, reskilling is an option to equip yourself with employable skills. For example, you can use your SkillsFuture to learn a new trade. If you still have trouble finding a job, you can book an appointment with an employability coach from the Employment and Employability Institute (e2i) for career guidance and coaching. It is hard to recover financially after a divorce if you cannot feed yourself – make sure you’re as independent as possible.

#5 Speak to your financial adviser

Just as how marriage counts as a life event that requires a financial portfolio review with your financial adviser, a divorce is also a life event that demands a similar treatment. As such, it is important to speak to your financial adviser to readjust your portfolio to take your new and old expenditures into account.

For example, in the past if your beneficiary of your life insurance was your ex-partner, you would need to change the beneficiary to someone else. Another example is that you no longer need to service your mortgage insurance after selling your HDB.  And you might have to strike out your ex-partner from your will.

Ask fundMyLife financial questions today!

We hope this article is useful to you if you’re going through a divorce, or if you’re considering it. It’s a huge change to your finances after splitting with your partner, but it is definitely possible to recover financially after a divorce.

If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our awesome financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

There is life after a divorce. You got this.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

The Best Insurance Policies At Your New Life Stages

The right policies when transitioning to new life stages

Life is a long journey. Typically, advancing into new life stages can be scary since each new life stage comes with its own special challenges and intricacies. Which you may or not be prepared for.

However, fear not. In this article, fundMyLife explores the insurance policies you need to get as you enter different new life stages. Typically, an individual in Singapore first goes through student life, followed by working adult life as unmarried, followed by marriage and family, and finally retirement. Do bear in mind that this guide accounts for more common life stages.

#1 Student

As a student, the minimum protection you should get is hospitalization plans for yourself. This is because you have do not have dependents, and you still relatively low risk for critical illnesses,  For students in tertiary institutions, your school usually has a group insurance plan.

The only downside to that is that those are group insurances, and the payout may not be adequate. A quick look at the group hospitalization NUS scheme for students reveals that the limit is B2 ward. As a student, you can also consider personal accident plans if you are active in sports.

#2 Working adult

Congratulations, you’re gainfully employed in a company! Often, being employed comes with corporate benefits such as group insurance. Similar to what we mentioned earlier for pre-graduation students, group insurances do not have high payouts and you typically need other plans to cope with new challenges. For example, on top of your hospitalization plan, you’ll need to get critical illness. Now that you’re older, you’re at higher risk of contracting critical illnesses, especially cancer (touch wood). The lump sum from critical illness plans will help you get back on your feet in those events.

Depending on the nature of your occupation, it’s a good idea to thinking about disability income as well. Of course, office work has relatively lower risk of disability-causing injuries, compared to a physically-demanding job like working in a warehouse.

What if you’re a freelancer? Almost 9% of Singapore’s workforce consists of freelancers. This number is set to increase over the years as the gig economy expands in Singapore. While the freedom of time is a plus as a freelancer, it may also be slightly trickier. Being a freelancer has various challenges. Firstly, freelancers often have irregular and unpredictable cash flow. Secondly, when freelancers fall sick or get injured they do not earn money at all. Furthermore, there is no company insurance benefits that employees enjoy.

From our research, how some freelancers cope is purchasing personal accident insurance with income protection riders. However, this can be an expensive option. Earlier in 2018, GigaCover launched Freelancer Income Protection (FLIP) Insurance to provide freelancers who are unable to work with daily cash benefits.

#3 Married

With marriage, you now have dependents, i.e. people who depend on you. At the risk of sounding grim, with additional responsibilities, your life is now not just your own.

As such, you can consider more policies at this stage. On top of hospitalization, critical illness, and/or disability income plans, breadwinner(s) should strongly consider life insurance. In the case that the breadwinner(s) pass away suddenly, the life insurance payout can tide his/her family by. Mortgage insurance will also be important as well if you have a loan for your house, as in cases of unforeseen circumstances, mortgage insurance covers the remainder of your housing loan.

Mothers-to-be can think about maternity insurance for the peace of mind during your pregnancy. When your kid is older, consider getting a personal accident plan for him/her, since children are prone to injuries.

#4 Retirement

Now that you’re older, and the children have flown the nest, it’s time to scale back on some policies. Keep your personal accident insurance, as the elderly are accident prone. As always, make sure you have hospitalization plans for yourself to cover hospital and medical bills. On top of that, once you’ve retired, you’ll be less exposed to occupational hazards that causes disabilities. Your children are fine on their own – you can focus less on life insurance and focus more on life.

Ask fundMyLife financial questions today!

That’s all we have for you, folks! We hope this article was useful for your journey in life ahead. Whether you’re still going to be in one life stage, or is moving on to a new one, you’ll need to be aware of several constants. Hospitalization plans should be a lifelong mainstay, as there is a chance of you being in hospital at any point in your life. Furthermore, another constant is that in each life stage, you have new responsibilities. As such, your new policies should align with those new additions.

Getting your insurance done when you enter new life stages can be scary, but that’s what we’re here for. If you don’t know who to ask or where to find amazing financial advisers, we got you. If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our pool of financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

The Essential CPF Guide For Young Adults

An adult's CPF guide

Written by Letitia Jinghui Lean, edited by Jackie Tan

If you’re like me, a soon-to-be graduate about to enter the workforce, it’s probably high time you started getting acquainted with CPF. You know, “that compulsory government scheme that siphons off part of your allowance each month”. It’s gotten a bad rep for locking away the average Singaporean’s money till age 55, but there is another side to this complicated savings scheme, and we’re here to break it down for you. For the average millennial seeking financial independence and security, here’s your blueprint to understanding the intimidating CPF system to better guide you to a comfortable retirement:

#1 CPF is multi-functional

It sounds like CPF is just one jumbo savings/pension fund, but well, that’s barely scratching the surface. As defined by the Central Provident Fund Board, CPF is a “social security savings plan that provides working Singaporeans with security and confidence in their retirement years”, and every month, 20% of your salary (as the employee) goes to this account, whilst another 17% is contributed by your employer. This applies for all Singaporeans, unless you are: (a) self-employed, (b) working overseas, or (c) have renounced your citizenship.

Most importantly, CPF comprises 3 subsidiary accountsOrdinary (OA), Special (SA) and Medisave (MA). Remember the 37% of your salary that goes into CPF every month? Till age 35, different amounts are allocated to each of these subsidiary accounts like clockwork – 23% for OA, 6% for SA, and 8% for MA. It’s a whole different ballgame above 35, but eh, we’re sure you can google the new percentages when you hit that age. For now, just remember these numbers, and that each of the 3 subsidiary accounts have different purposes: the OA is used for housing, investment, education and insurance, the SA is used for retirement and investment, and the MA is used for hospitalization and medical insurance expenses.

#2 A fourth account – the Retirement Account (RA) is created when you’re 55

At 55, the remaining balances in your OA and SA are combined and transferred to automatically form the RA, to provide for comfortable self-sufficiency and retirement in old age. Monies are transferred up to the Full Retirement Sum (which increases approximately 3% every year), up to the Basic Retirement Sum (half of the FRS) with a property pledge, or even beyond for the Enhanced Retirement Sum (1.5 times the FRS). If you have excess above the minimum required retirement sum in your RA, this is when you can withdraw it, at the ripe age of 55.

The next milestone is then 65 years old, under a nifty lil’ scheme known as CPF LIFE. For now, all you need to know is that CPF LIFE is what gives you the monthly payouts once you’re old (and preferably not too wrinkly) at 65, and it’s based off your RA. The general rule of thumb: the more you have in your RA, the higher your monthly payouts.

#3 There are different interest rates for OA, SA and MA

As mentioned previously, CPF is kinda like a compulsory savings account, which means that it automatically generates interest for you, which introduces an almighty term – compound interest (great for more moolah). Interest rates for OA is at 2.5% per year, whilst rates for SA and MA are at 4% per annum. This is way higher than what most banks tend to offer for savings account (about 1% or less), so rejoice my fellow young adults!

As a bonus, there’s an additional 1% interest for your first $60,000 in your CPF – a good deal because that means you get higher interest rates for your OA at 3.5% and your SA at 5%. One caveat: this additional interest is capped at $20,000 for OA, and $40,000 for SA. Wily millennials will know it’ll make more sense to transfer money from the OA to SA to milk that higher interest rate for the SA account, but word to the wise – this transfer process is irreversible, so do give it careful consideration based on your own personal goals and circumstance before you make the decision.

#4 You get tax relief for being pious

As a full-fledged working adult, you will have to pay taxes. It’s inevitable, unless you pull a Trump. You can however, reduce the amount of taxes you have to pay, by voluntarily topping up your own or your family members CPF SA account. For each year, you get up to $7,000 in tax relief when you perform cash top-ups to your own account, and an additional tax break of up to $7,000 when you do the same for your loved one’s SA account – that’s up to $14,000 in tax relief a year! It’s a win-win situation because you save yourself from having to pay excessive taxes, whilst building your retirement fund at the same time.

#5 You can specify who receives your CPF savings after you pass on

Our time on this earth is finite. In Singapore, when you die (touch wood), the monies in your CPF account will be distributed to your surviving family members according to intestacy laws. For those who want more control over how your CPF savings are distributed, consider making a CPF nomination to ensure that your loved ones are taken care of upon your death, and the money gets distributed according to your wishes.

#6 You can pay for a home using CPF

As any Singaporean will attest, buying a house/apartment/flat in Singapore is ridiculously expensive. Its common practice to use savings from the CPF OA account to buy a HDB flat (assuming you’ve gotten your BTO), or to use it for monthly loan repayment to pay off the mortgage under the public or private housing schemes.

For those keen on buying a house in the near future, here’s 2 things to consider:

  1. Remember that the process of money transfer from your OA to SA is irreversible, so if you’re dead set on getting a house, stick to your guns and keep the money in your OA until you’ve bought one. The caveat of course, is if you don’t intend to purchase a property, or if you can splash the cash and do not need your CPF to cover for the cost of the property.
  2. Remember that to withdraw CPF funds from your RA for retirement at 55, you will have to satisfy the Basic Retirement or Full Retirement Sum with sufficient property pledge. A property pledge is a promise you undertake to return the CPF funds used to pay for your housing, with interest, should you sell your property. TLDR; if you want to withdraw all the excess monies in your CPF savings when you hit 55, you will have to own a house. Otherwise, it’s a cap of $5,000 on the amount you can withdraw from your RA.

Still confused? Here’s a more comprehensive review from DollarsandSense about the whole CPF-HDB housing scheme. You’re welcome.

Adulting is tough, entering the workforce with its mountain of responsibilities even tougher. We’ve consolidated just 6 key aspects of CPF most relevant to young adults, that we hope will help you navigate the complexities of adulthood better. Time to make the most out of your CPF, and win at it!

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

Getting Married? Find A Good Financial Adviser!

Getting married? Find a good financial adviser

Getting married? Congratulations!

There’s definitely a lot of moving parts involved. You’re probably surrounded by well-meaning friends and relatives who are giving you tips for the big day and beyond. Let’s talk about one piece of advice that’s not given as often as it should be when people are getting married: the importance of finding a good personal financial adviser. A lot of people neglect the importance of budgeting when it comes to marriages, leading to massive debts down the road. In this article, fundMyLife shares the reasons why you need a good financial adviser when you are getting married.

Do you share a common dream?

Previously, we talked about ways couples can manage their money and how to stop fighting about money. However, besides having a conversation about the present, it’s important to talk about the future as well. Angela and Ben* want to build an asset base of $1 million in 20 years. This would provide them with sufficient passive income to quit their jobs and start their own business. After reading up on their own, they decided to invest $500 per month in a single investment.

It was only during their consultation with their personal financial adviser that they saw, based on their plan, that they would achieve only a small faction of what they wanted at the end of 10 years. In the absence of a personalized financial planning process, we often plan our finances without proper approaches. The information from these sources is often not catered to our specific situation, leading to mistakes like the one Angela and Ben made. Sometimes you and your partner may have blind spots due to emotional factors, or simply, a lack of financial knowledge.

Working with a personal financial adviser ensures that you cover all financial grounds. On top of that, your unique situation is taken into account in creating your personalized financial plan.

Can’t see the future together?

There is a saying – “a goal without strategy is called a wish”. We often think about the destination, but not necessarily the journey required. If you and your partner have clear goals in mind, but have no idea how you are going to get there, you should seek a personal financial adviser. The same applies if you can’t set clear goals together on your own. The best ones can tease out what you really want out of life.

Note: that sort of question is also a deep one and may require more self-reflection. Just don’t spiral into an existential crisis.

Can’t agree with each other?

If discussions about personal finances result in regular disagreements and heated quarrels, you may wish to engage the services of a counselor and/or personal adviser. There may be emotional blockages in the flow of communication that need to be addressed for the good of the relationship. Having a financial adviser in the picture may provide clarity and an unbiased view on how to discuss money. Besides, an experienced adviser would have advised other couples on their finances as well.

Ask fundMyLife financial questions today!

That said, having a personal financial adviser is not always necessary, especially if you have clear goals in mind, and have designed a clear path to get there. If you don’t know where to start to get to where you want to end, then having a personal financial adviser may be useful to you.

More importantly, if you don’t know who to ask or where to find amazing financial advisers, we got you. If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our pool of financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Sometimes, all you need is a good third wheel before getting married.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

Pros And Cons Of Getting Insurance From Just One Financial Adviser

Pros and cons of getting insurance from just one financial adviser

There is a saying, that “diversity is strength”. While this is true on many fronts, can we say the same financial planning and insurance? Throughout our lives, we inevitably meet a lot of financial advisers, and there is always a question of whether to engage more advisers. This is especially true when we move from one life stage to next. In this article, fundMyLife explores the pros and cons of having just one financial adviser for financial planning.

Pros of having just one financial adviser

#1 No need to repeat yourself

Having just one financial adviser, especially if he/she is great, is all you need. He/she understands all of your financial needs and advises on suitable products. In this case, you do not need to keep repeating your financial situation to different financial advisers – it can be repetitive and tiring. Furthermore, if you have just one financial adviser, you just need to update him/her in cases of changes in life stages, e.g., life stages, occupation, financial situation, etc.

Furthermore, if you have any private matters you do not wish to talk about often, it’s easier to have a single person to handle everything. The less people know, the better.

#2 No redundancy

While being under-insured is a big problem, being over-insured is also an issue that is less discussed. Being over-insured poses a problem because you’re paying more than you should, limiting cash flow for other purposes like investments. This happens commonly when you buy policies from multiple people, who are not aware of what existing policies you have. Typically, the policies you own sit in drawers, untouched for a while. This is worse when you get them for reasons other than personal, e.g., to “support” a friend or family who has gone into the financial planning industry.

By sticking to a single financial adviser, you avoid this possible redundancy. Speaking of being over-insured – you do not want to be in a situation where you’re more valuable dead than alive to your dependents.

#3 Single point of contact

Picture this: you bought a life insurance from A, health insurance from B, and a personal accident policy from C. After that, let’s say you get into trouble, e.g., accident, sickness, etc, you’d have to recall who can help you with your incident. During claims situation, you’d want a single person who has access to your entire insurance portfolio. The last thing you want to do when disaster strikes is needing to figure out handles which policy.

Cons of having just one financial adviser

#1 All eggs into one basket

While having a single point of contact is convenient and useful, it also exposes you to risks as well. For example, a common issue consumers face is their financial advisers leaving the industry. Your policies would become orphan policies, a term that refers to policies without any servicing adviser. At best, if your adviser is responsible, he/she refers you to a reliable colleague. At worst, you’re left hanging and when it is time to make claims you’d have to take extra steps to contact the representative the company assigned to you.

Another possible risk is that your adviser becomes unwell and has to take a break from his/her job. It would be a bad timing if you need to make your claims during their downtime.

#2 Limited range of products

Unless your financial adviser is from an independent financial advisory, your choice of plans depends on the company your adviser is from. As such, it might not be a bad idea to engage multiple advisers to obtain specific products from different companies. With apps such as PolicyPal, IOLO, and TrueCover, it’s much easier nowadays to keep track of all your policies.

However, this does not imply that sticking to one company’s products is a bad thing. Products are competitive across the board. Most of the time, the differentiating factors lie usually in gimmicks. For example, wellness programs like AIA Vitality, or partnerships between Prudential and genetic testing company MyDNA. On a related note, the debate of tied adviser vs independent financial adviser is a completely separate issue, which we will explore another time.

Ask fundMyLife financial questions today!

With this article, we hope that you have a better idea of how having just one financial adviser can be a boon or bane. However, no matter whether it’s just one financial adviser that you engage, or several of them for different products, it’s definitely way more important to have the ones you can trust.

If you want to engage more financial advisers, or if you haven’t found the right one, why not consider advisers of fundMyLife? You can head on over to fundMyLife and ask our pool of financial advisers questions. Alternatively, you can check out our curated pool of individual advisers and ask them questions directly.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

How To Stop Fighting About Money In A Relationship

Stop fighting over money in a relationship

Written by Daniel Tay, edited by Jackie Tan. 

We earn money with our blood, sweat and tears. We earn it with irreplaceable time and indeed our very lives. Earning, saving, spending, investing, and giving money all involve some kind of sacrifice, making money a highly sensitive subject even among couples. Read on to find out how to stop fighting in a relationship if you and your partner frequently quarrel over his/her spending habits.

Step 1: Understand the past

Firstly, understand that it may not be you or your partner’s fault. For example, we usually learn how to handle money from our first teachers – our parents.

Jane’s (not her real name) father was a problem gambler. He frequently borrowed money from family members including her, often not returning what he borrowed. Jane loved her father very much, and didn’t like to refuse when he approached her.

But Jane didn’t like to have to keep lending her dad money. Her solution was, from a young age, to spend all the money she had. That way, she didn’t have any money to lend.

Jane’s circumstances forced her to adopt a certain spending habit. If our parents handle money poorly, it is also likely that we will learn their habits.

Step 2: Communicate feelings

Jane brought her spending habit into adulthood, causing many problems in her relationship with her boyfriend. When he tried to rein in her spending, she would flare up and they would fight.

Communication about money, like all forms of couple communication, isn’t really about the money. It’s actually about the emotions behind that. Instead of saying, “Stop spending money already!” it may be more effective to tell your partner how you feel about his/her spending habit and why you’re feeling that way.

When two people come together, financial matters become intertwined. Financial decisions that were once straightforward may not work out so well anymore. Bringing up this fact may help your partner realize that his/her actions are affecting you.

Don’t ignore the problem

If you’re tired of fighting and thinking of closing one eye to your partner’s spending problem (either too much or too little) because it’s not hurting anyone yet, you’re setting your relationship up for failure. In fact, not communicating about money is a direct consequence of an even more serious problem in your relationship: not communicating about emotions.

When couples do not communicate with each other on their emotions, it implies distrust in each other. “I don’t trust that you will not judge me. I don’t trust that you will accept my feelings, my emotions.” Left alone for a long enough time, this distrust can destroy the relationship.

A challenge to overcome

It’s not going to be easy for your partner to kick or change his/her lifelong spending habit. You need to assess what this means for yourself and the relationship in the long run. In some instances, couples decide that breaking up is best.

However, don’t give up on your partner before the two of you have a heart-to-heart talk about it–the discussion may just spur your partner to realize how his/her actions affect you and take action. If both of you can work things out together, the fighting will stop and your relationship will emerge more resilient than ever!

A good financial adviser can also counsel those who are fighting over money in a relationship. Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.

Basics of Insurance

Basics of Insurance

Written by Letitia Jinghui Lean, edited by Jackie Tan and How To Adult. This was a guest post for How To Adult.

Self-sufficiency, or in easier terms, being able to cover your own ass just in case. What else does this remind you of? Yup, you guessed it – insurance. Think about having insurance as the ability to build your house from the ground after it gets blown away by the big, bad wolf. With insurance, you’ll save yourself the monetary stress!

7 Ways Couples Can Manage Their Money Without Fighting

Manage money without fighting

Written by Daniel Tay, edited by Jackie Tan. 

Getting together as a couple presents not only a new lifestyle, but also new ways on managing their finances together. It is said that couples often prefer to manage their money like how their parents did. However, a couple’s unique situation may require a style different from their parents’. Money is a huge factor in a couple’s relationship, and managing them is a key to either breaking or making it. In this article, we present seven ways of managing a couple’s finances.

#1 To Each His/Her Own

Each person handles personal finances in separate accounts.

Barry is a widower whose ex-wife had cancer. To pay for her medical expenses, Barry depleted his savings, borrowed heavily on his credit cards, and took personal loans. While paying off his debts, he enters into a new relationship with Iris. They want to buy a property together. However, Barry might be unable to take any loan, having maxed out his borrowing facilities. Barry and Iris keep their finances separate until his finances become healthier.

This way also works when:

  1. One party’s finances are much more complex than the other, e.g., one party has multiple sources of income
  2. One party has secrets to hide
  3. Mutual trust is lacking between the two
  4. Both parties spend money very differently or are unsure of their long-term commitment to each other

What is required:

  1. Simple financial planning
  2. Sophisticated estate planning, due to individually owned assets

2) What’s Mine Is Yours

Combine all finances in joint accounts.

Young adults Harry and Gwen have been dating for years. They have similar personalities, hobbies, and life goals. They do almost everything together. Each cares deeply for the other’s family. As they make similar financial decisions, they decide to combine their resources in a single account.

This works when a couple:

  1. Want to seal their long-term commitment to each other
  2. Have shared hobbies, combined financial goals, and straightforward finances
  3. Are close to their families
  4. Have mutual trust

What it requires:

  1. Sophisticated financial planning
  2. Simple estate planning with joint ownership of assets
  3. Open communication about each other’s spending

#3 You’re My Equal

Each person owns an account and contributes equally to a joint account.

In Diana’s family, the women are strong-willed. In Steve’s family, men make the decisions. Unable to agree on their money management, Diana and Steve hold separate accounts. However, they need to pay for their house and daily household needs. They pay for these expenses from a joint account to which they contribute equally.

This works when a couple has:

  1. Some combined financial goals, but want some independence.
  2. Roughly the same income
  3. Moved in together and have shared household expenses or shared savings goals.

What it requires:

  1. Complex financial planning and estate planning

#4 I Pay, You Save

One person pays for everything. The other saves/invests all of his/her income.

Scott and Jean want to take up a full-time university course, but cannot do so simultaneously. They first accumulate savings, living on Scott’s earnings and saving all of Jean’s earnings. After building their savings and emergency fund, Jean goes for full-time study. By now, they are used to living on Scott’s salary. When Jean finishes her studies, she finds a job with income roughly equal to Scott’s salary. Scott then goes for his further studies.

This works when:

  1. One person earns much more than the other
  2. A couple goes single income in future, as it disciplines them to survive on one person’s income

What it requires:

  1. An income replacement plan for the one whose income pays for all the family expenses, in case she/he becomes unable to work
  2. Family emergency fund
  3. Disciplined spending
  4. Budgeting for leisure

5) The Fair Treatment

Each person contributes an amount proportionate to his/her income.

Henry, a scientist, earns a stable income. His wife Janet starts an interior design company. At first her projects are intermittent. Some months she earns nothing. Hank contributes more to their shared account. Janet contributes when she can. When Janet’s business flourishes, she takes over contributing more to pay for their shared expenses.

This works when:

  1. One person’s income is much higher than the other’s, and he/she is uncomfortable with the other contributing the same amount.
  2. Both have different lifestyles.
  3. One party is switching career, or starting a business.

6) Pay As You Use

Each person pays for the products/services that he/she use more.

Peter is a photojournalist. Mary-Jane is a fashion model. To look her best, she uses beauty products and services. She pays for their magazine subscriptions, including her beauty magazines and Peter’s photography journals. Peter buys cameras, lenses, computers, and photo-editing software. He pays for the family computer and related online services.

This works when one partner:

  1. Does not want to pay for the other’s hobby
  2. Has an expensive hobby, like shopping, collecting luxury items, travel etc
  3. Uses a household service much more than the other e.g. internet, cable TV, garden services, etc

7) The Japanese Method

One person holds all the money and gives the other an allowance.

Clark comes from a rural Indian village. He came to Singapore to work in a tech company. His wife Lois, a homemaker, grew up in Mumbai and immigrated to Singapore. Knowing little about finances, Clark gives his monthly salary to Lois who makes the financial decisions. Lois gives Clark a monthly allowance.

This is useful when only one party knows how to manage money.

Risks:

  1. If the one managing the money becomes unable to do so, the other could be at a loss as to what to do.
  2. If the breadwinner manages the money, the other might feel a power imbalance in the relationship.

What it requires:

  1. An income replacement plan for the breadwinner, in case s/he becomes unable to work
  2. Family emergency fund
  3. Insurance for the non income earner because if he/she falls ill, becomes disabled or gets into an accident, the breadwinner may have to pay for others to look after the children and household or take time off and a pay cut to do it

At the end of the day, each couple has to decide which method best suits their preference and situation. A couple does not have to stick with one way all the way, because situations do change. And these methods are not mutually exclusive as different ways can be combined for certain situations. In addition, couples should seek the advice of a holistic financial planner to optimize their assets.

Been doing lots of research, but not sure who to engage to take the final step? Look no further! fundMyLife connects you to credible and incredible financial advisers privately and anonymously, based on the financial planning questions that you ask. We aim to empower Singaporeans to make financial decisions confidently.

Follow us on our fundMyLife Facebook page to get exciting updates and your dose of finance knowledge! Alternatively, the Insurance Discussion SG Facebook group is a good place to discuss insurance-related topics with fellow Singaporeans.