Sound Finance

Apparently the recent conditions of the economy had inspired many of our peers to be financial advisors, as my neighbourhood friend commented as we met for coffee. I have heard from other friends as well that many fresh graduates had became financial advisors and it seems competition amongst financial institutions have heated up. My friend was telling me that the two most frequent groups of people that would stop him in the streets are either flag-day volunteers or financial advisors.

Financial planning encompasses a wide area and involves the different stages of life; from planning of the perfect wedding, to getting a house, providing for the kids and even their future education. It starts from your current financial situation and determines how much you wish to set aside for insurance, savings, investment, or just some extra for a rainy day. The consensus is 7:2:1; 70% for expenses, 20% for savings and 10% for children's education (depends on how many children).

Actually with some knowledge you are able to plan your own finances, for even with the help of a financial advisor, ultimately you must make a conscious choice of how to manage your money. While setting aside some money to plan for your future, many people have a tendency to overdo it. It is good to be aware of how much you can afford to spare and whether some of the things you plan for are within your comfortable budget.

Both my friend and I know of close people who have passed away. Their deaths can only be described as sudden. We will never know when we will leave this world, so no point being so harsh on yourself by tightening your finances too much as my friend went on to say. While it is a good habit to save, once in a while it can be fun to pamper yourself a little with your hard-earned money. As the cliche goes: Life's short. Work hard, play hard.

As for advice on the choice of a financial advisor, don't take up a policy just because the advisor is your friend. Make sure you go through the details and be sure of what you're really getting into.