What is Investment Planning?
Investment planning is the process of matching your financial goals and objectives with your financial resources. Investment planning is a core component of financial planning. There are thousands of different investments. The most commonly used are cash, equities, bonds and property.
Using Abundant Life Planner’s unique 3 step approach to build your customised and bespoke Financial Home, Investment Planning is one of the Financial Rooms that some may have as well.
Thus, we make use of our 6 Questions Approach to ensure that you are able to continue living a comfortable lifestyle even after retirement.
What are the 6 Questions Answered?
- How much do I need to invest every month?
- How much risks can I stomach?
- How many months of emergency savings should I have?
- When should I start?
- Should I do dollar cost averaging or time the market?
- Should I take a loan to invest?
What happens if I don’t plan?
Investment Planning is a positive way to combat inflation and the negative effects of inflation for you would mostly be that it would erode the purchasing value of your money.
Most people would see that $50,000 today would still be $50,000 20 years down the road. However, if you look closely at the purchasing power of this $50,000, you would notice that you would be able buy significantly lesser things than before. Why is this so? It’s because inflation has eroded the purchasing power of your money.
This erosion of money is measured by the Consumer Price Index, which is designed to measure the average price changes of a fixed basket of consumption goods and services commonly purchased by resident households over time. It is widely used as a measure of consumer price inflation.
Why do people not invest?
- Saving Money in a Savings Account
- Investing Later When They Have a Higher Salary
- Trying to Time the Market
- Investing is Too Risky
- Investing is Intimidating
What are some investment options?
- Fixed Deposits
- Singapore Saving Bonds (SSB) and Corporate Bonds (CB)
- Structured Deposits (SD)
- Unit Trusts
- Real Estate Investment Trusts (REITs)
- Shares
- Exchange-Traded Funds (ETFs)
- CPF Special Accounts
- Investment – Linked Policies
- Endowment Policies
- Properties
- Cryptocurrencies