Maybe you heard of this saying before. What does it mean, and why is it viable for your finance?
Term VS Whole-life
People typically buy a whole-life plan for their insurance. It is typically expensive, and its advocates say that it has a savings value. But it is a saving that shrinks. Term plans have no cash value, but they are also much cheaper for the same amount of coverage, allowing you to free up your money for real savings.
Invest the Rest
The money you free up can then be used to invest for your future. You would like to stop working some day? We can set up your retirement fund. Children’s education fund? They would be happy not to be distracted by part-time work while studying.
Whatever your goals are, investing is the way to go forward. Now, all investments come with risk, so how do you minimise that risk?
You engage with a financial advisor that really knows the stuff. Investment results depend solely on choosing the right funds, so choose an advisor as if your future depends on it. It really does.
How to filter out the bad ones
All advisors can show you a plan, project an investment project earning 4-8% over the investment period. Everyone knows how to say this in the training phase. Take it a step further and grill them.
1) What funds should I buy now?
2) What is your opinion on today’s stock market?
3) Can you show me the funds you buy yourself?
Question 1 will show their knowledge or lack of it. If they cannot answer you within 5 seconds, you know they haven’t done the homework. At the very least, they should show you 3 funds performing over 8% over the last 10 years. Remember, once you sign, it’s 10 years of your money at least! Question 2 will show you if they are the type of person who watches the market. There are plenty of people who just pick random funds for you and hope they go well. They meet you once a year. Do you really want them to earn that 35-50% commission on your investment?
Question 3 is paramount. Do they stand behind what they sell? If they do, they won’t be afraid to show it. If they don’t believe in their own product, why should you? It is your money, and your future!
The earlier you start investing, the better
Investments takes time, and the earlier you start, the earlier you can see results. Granted, you choose the right agent that works hard.
What if you don’t know a good agent? We partner with licensed agents from MAS-approved institutes. If you would like to learn more, we can set up a free consultation for you. If you are keen to have a chat and see if there is anything we can do for you, click on the form here.
