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Retirement

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Retirement is a special time for everyone. It could be a time to travel around the world and do the things that you always wanted to do, without worry. It could also be a time where you simply want to spend quality time with your loved ones. Regardless, it is a matter of choice on how much time and the type of quality you want in each phase.

PRE RETIREMENT PHASE
This is the phase where we start asking themselves:

  • What is the ideal retirement age for me?
  • Do I want an “ordinary” retirement or do I want to enjoy my dream retirement lifestyle?
  • What must I do now so that I can retire as soon as possible?

Increasing we are seeing young millennials as young as 25 starting to plan for their retirement so that they can retire early and extend their retirement phase for as long as possible. They understand that the later they start, the further away is their retirement. Time is of the essence.

During retirement, there are only 2 things to prepare for – our basic survival needs and our desired lifestyle wants. A well thought out retirement strategy must deploy different strategy for each of them.

Can you imagine only eating when you have income and not eating when you have no income? Hence it is a good practice to adopt the strategy of matching guaranteed needs with guaranteed income and vice versa. Assuming your current basic survival needs is $1,500 per month, in 20 years time, you need $2,500 per month after taking 2.5% inflation into account.

CPF Life is an instrument providing your first stream of guaranteed income. Increasingly many people are looking for another source of guaranteed income for a second layer of safety instead of solely relying on CPF Life.

Source: CPF

Eldershield, or the upcoming CareShield should also form part of your building blocks for basic survival needs because:

  • Income for your basic survival needs double when you are sick or disabled at old age
  • No matter how good you are at investing, you cannot guarantee that your income will be doubled when you need it the most
  • They help you to retain income even if you are sick or disabled

A rule of thumb for disability income is about 50% of your retirement income. Is there a gap in your portfolio?

Source: CPF (left); MOH (Right)

Once your basic survival needs have been adequately addressed, we can then look at enriching your desired lifestyle wants through investments. All you need to know about investment is just 2 things – Return and Risk.

With investments (including property), there are only 3 ways to make money depending on your preference:

A trained farmer is able to identify a duckling from a gosling and select a quality goose over a sham.

No one can predict the future, however everyone can manage risk by investing globally and into different types of investments. In order to be successfully over the long term, start early and diversify your investments. The best time to invest is always yesterday!

Recapping on pre retirement phase

  • The later you start, the further you are from retirement. Time is of the essence.
  • Match guaranteed income with your basic survival needs and vice versa
  • Do not forget about possible illness and disability events at retirement
  • Understand your investment preference and its risks. Diversification is key
  • Always reach out to a trained professional if in need of help

Stay tuned to the next phase of retirement!

Contact Bernard here to find out more about Will Planning.

Do you need a Financial Consultant with experience in Divorce Planning?

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Our Private Wealth Management Solution can help you maintain financial security when planning for a divorce.

Divorce creates fear and uncertainty for you and your loved ones. At a point of vulnerability, it is easy to lose sight of details and miss the big picture. Divorce also forcefully puts you in a position to be fully responsible for your own finances within a very short notice. Such situations is very stressful and overwhelming notwithstanding the emotional roller coaster involved. It is very tempting to allow emotions to take over our decision-making process and neglect personal finances during a divorce. However being clear minded and relying on trusted professional will help ensure the best possible financial roadmap for you and your loved ones. This starts by knowing not only how much you have now, but also what you will have post-divorce.

If you are preparing for, in the midst of, or have finalized divorce, we can assist you in providing financial clarity of what your situation. As a financial consultant specialising in divorce planning, we provide a wide array of services to rebuild your finances from scratch and leading you to financial wellness.

 Our services include:

  • Post-Divorce Budgeting
  • Preparation of Financial Affidavit (marital asset inventory)
  • Settlement Proposal Analysis
    • Asset division
    • Spousal family support
    • Income Imputation
  • Estate and Legacy Restructuring
    • Nominations
    • Wills
    • Trusts
    • Last Power of Attorney
  • Financial Coaching
  • Business interest Planning

Contact Bernard here to find out more about Will Planning.

I Had My Will Written At 24. This Is Why..

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I had my Will written at the age of 24. I am often met with a look of disbelief mixed with confusion, followed by the questions:

  • You’re so young, how much do you have to give away?
  • Do we really need to write a will?
In this article, I intend to address the urgency and importance of Will Planning as an integral area of an individual’s Financial plan, and the perils of leaving without one.
 
Simply put, a Will is like a key to your Treasure Box. Passing on without one is akin to giving your loved ones a 10-digit combination lock without telling them the number combination.
 
My initial impression about Will-writing was that it was exclusive and necessary only for the filthy rich; TV Dramas have sealed the impression of how individuals fight after a family fortune to no end. And I too, very quickly disqualified myself asking the first 2 questions that now people ask me. But after finding out more on what it is about, this is what I have to share:
 
Intestacy; When one dies without a Will
 
Usually, this is more complicated than you would imagine. Someone does not simply call up your beneficiaries and give them a portion of the inheritance. More often than not, your Administrator will find himself/herself appearing in front of the Judge several times, attempting to prove as the rightful claimant to your estate. This involves the need for stacks of paperwork, and fees incurred by legal and financial professionals. Cases can range in complexity based on whether you have beneficiaries who are Minors (children under the age of 21), the number of immediate family members you have, and the relationship between these individuals. If amicably settled, the shortest time will be around 6 months. In unfortunate cases, it could drag on for years on end.
 
You want to be remembered for the right reasons; not because you left a total mess and unsettled business for your family to pick up the pieces.
 
Reasons for having my Will written
 
It is a common understanding that often times, matters within the family can be settled amicably. But in regard to assets and how they are to be distributed, disputes are bound to arise. Therefore, I had my Will written because I wanted the choice of how my estate would be handled.
 
Having a Will written allows me the control over these things:
  • I want to be clear of who the person handling my estate will be – someone whom I trust, is willing, available and with integrity.
  • Have the say in who my assets will benefit according to the proportions I want.
  • My beneficiaries need not be based in Singapore; they can be individual and charitable organisations based overseas.
  • On the first-cut, I can benefit individuals and charitable organisations, which by way of intestacy, would never become beneficiaries.
  • I want to benefit selected beneficiaries as well but understand that even after they attain the legal age of 21, I pre-assessed that they may not be responsible enough to handle the monies and prefer it to be withheld and managed by a Trustee.
  • I want to dispute the fact that people think they must have a lot of assets with them before they give. In the course of Will-planning, I created an immediate estate with equal value to a property through a simple, affordable term insurance.
I strongly believe that gone are the days where Will writing is seen as taboo. Increasingly, it is becoming a topic that is gathering more attention. Having a Will written by a professional is simply stating down one’s intentions and facilitating the process so that one’s assets can benefit their loved ones as soon as possible.
 
Some initial objections I have with people often show that this is an area where much value can be added:
  • “I will have my Will written the hour before I die…” How do you know when and how you would go?
  • “I don’t have much to give…” What if I told you I could create wealth for you to give?
  • “All my assets are held in joint-agreement…” What if both perish in a common disaster?
  • “Should my husband and I perish together, my sister will take care of our child…” Is this what your husband wants as well? What if she is not available/willing?
  • “I am a single parent and will leave all to my children…” How sure are you that they will out-survive you?
  • “My family will know what to do when the time comes…” Will they know how to handle your matters as well as you do?
  • “I haven’t thought of who to give and who to handle my money…” All the more with you having an opinion, I believe you wouldn’t be satisfied with letting the local law decide for you.
Life is fragile, but most people delay planning because they are under the impression that Will planning is a very complicated process. This is where it is advantageous to engage a Will Planner to discuss their concerns.
 
Think for a moment, of how you would like your family to be taken care off. This is akin to the last words to your family. What will they be?
 
I am an accredited Will Planner representative at SimplyWills Pte Ltd and I can assist you in the facilitating your Will. Our team has written more than 10,000 Wills and helped more than 500 families in applying the grant of probate/letters of administration. Our vision for the company is to be the preferred Will writing company in Singapore by providing affordable and accessible Will writing, probate assistance and succession planning service.

Contact Joshua here to find out more about Will Planning.

Release of Baby Bonus Boosters eBook by Joanne Lai

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Baby Bonus Booster eBook

The New Age Parents Magazine has invited Certified Financial Planner – Joanne Lai, who specialises in comprehensive financial planning, to contribute to the second part of ‘Raising A Money-Smart Child’ E-book series. In the “Baby Bonus Boosters” eBook, Joanne addresses on the following concerns:

  • What are the initial costs involved when you have a baby?
  • Are you fully optimising your parenthood benefits?
  • List of Priorities for Parents:
    • Priority #1: Are Both Parents Covered?
    • Priority #2: Pregnancy Complications
    • Priority #3 Is Your Baby Covered?
    • Priority #4: What Happens When Your Child Gets Into An Accident?
    • Priority #5: Critical Illness And Child Related Illnesses
    • Priority #6: Your Child’s Education
  • The Difference Between Baby Bonus And CDA

Click on this link to read more about what Joanne has shared to the New Age Parents Magazine or you can download the eBook here.

Whatsapp/Contact our admin @ 9475 8860 or email us: admin@actsadvisorygroup.com, to find out more about planning for your child(ren)’s future.

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