5 min read I Date: 19 January 2024
A step-by-step guide to build a personal financial plan
When it comes to life's biggest moments, you probably had a plan. Your wedding, for example, followed a timeline and a budget—even if you busted it with that last-minute table for extended family—and involved compromise and conversation. Smart financial planning follows the same logic.
Our how-to articles (refer to the link below) can help. They take you through a step-by-step need to know on how to create a personal financial plan and help get your money in order. These tips can help you achieve your short-term and long-term goals, from groceries to retirement planning and the looming repair bills.
Let's get started.
Set financial goals.
It’s good to have a clear idea of why you’re saving your hard-earned money. Think it through with a five-step guide to setting yearly financial goals (worksheet included).
Make a budget.
Instead of thinking of a budget to restrict your spending, use it as a tool to organize your monthly cash flow to help you pay yourself first (savings/investing)—and still have room for the fun stuff. Learn how to create a budget that works for you—not against you. (Downloadable budgeting sheet included.)
Build an emergency fund.
All the planning in the world won’t help if life throws you a curveball and you’re not prepared financially. That’s where emergency savings come in handy. Our guide to building an emergency fund includes a calculator to help you figure out how much you need to save and how to maintain it over time.
Manage debt.
Understanding and managing debt is a vital part of creating a financial plan. Learn how to pay off the debt you owe now and build a long-term debt-management strategy (worksheet and calculator included).
Plan for a quality retirement by investing beyond your EPF contributions.
To reach your mid and long-term goals, take your savings strategy and put an engine behind it. For example, suppose you want to start a good, consistent habit of investing. In that case, you can always explore investments with minimal investment risk such as a money market investment instrument.
If you are an investor with a bigger risk appetite, you could consider investing in mixed asset or equity funds which could give you Global, Regional and Domestic investment exposure.
What to do next?
Explore ways to diversify your investments with Principal via our digital investment channels such as Touch ‘n Go eWallet’s GOinvest or Principal online investment portal.
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