Tips on keeping your finances in good shape
Every woman wants to keep fit physically, and I am no exception. By staying healthy and fit, I have more energy and focus to manage all kinds of household matters. Also it wouldn't hurt to maintain the enviable physique that I had when I was in college (wink).
Of course, keeping financially fitness is just as important. I would like to share six simple and easy tips on how we can do so.
1. Start saving early
Savings is the foundation for financial health. The earlier you start, the more time you have to grow your wealth, and the sooner you can achieve your financial goals! Develop your savings plan with the Savings Goal Calculator and start working towards your goal now.
2. Get sufficient protection
With so many insurance products available in the market, you must understand your needs and compare the different offerings before picking the most suitable one. You also need to pay attention to the terms and conditions and coverage of the plan.
3. Invest rationally
Investing is a good way to grow your wealth and guard against inflation. However, the ever-changing market means that you must always stay rational and prudent, and do your own research rather than follow rumours and speculate. Before making any investment decisions, understand your risk profile and tolerance, expected return and dividend, investment horizon and liquidity.
4. Borrow responsibly
It is easy to get a loan in Hong Kong, but you should always think twice before applying for one. Do you really need the money? Can you make the repayments? After taking out a loan, be sure to manage your debt carefully and address any debt issues promptly before it escalates.
5. Plan your retirement
Hong Kong people tend to have a longer life expectancy now, and may enjoy decades-long retirement life. How much retirement savings do you need? Retirement planning is a long-term process. Plan well ahead when you are young and manage, protect and invest your assets wisely in retirement.
6. Make an estate plan
Everyone has an estate, no matter how big or small. Yet you won’t be able to manage your assets upon death or loss of mental capacity. Therefore you should make early arrangements to entrust someone dependable to handle your money matters.
The Investor and Financial Education Council