Note: It was announced in November 2023 that MoneyOwl will be acquired by Temasek Trust to serve communities under a re-purposed model, and will move away from direct sale of financial products. The article is retained with original information relevant as at the date of the article only, and any mention of products or promotions is retained for reference purposes only.
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It’s that time of the year. You’re attempting to make your home presentable for visits, navigating the human crush to stock up on new year goodies and preparing the notes (or e-transfers) for the red packets. In addition, you might be juggling a full-time job, kids, your other half and more. All these competing demands can feel like it takes up all your time.
We get it. It’s easy to let life get in the way of your finances. However, like how organising your home can be a form of self-care, having your finances in order will remove unnecessary stress and give you that sense of well-being that you’re en route to meeting your life goals.
Here are eight ways to get your finances sorted and on your way to a prosperous new year!
#1 Refresh Your Budget
Review your spending and reset your budget by cutting down on non-essential or underutilised expenditures and setting aside more for your future. With inflation and the increase in GST, consider switching to house brands and optimising loyalty programmes to earn rebates and rewards on your household expenses. Similarly, under-used subscriptions will cost slightly more now, so pull the plug if they no longer spark joy.
#2 Set New Intentions With Your Financial Goals
Being specific with your goals can make them easier to achieve. For example, “I will limit treats to twice a month and not more than $100 each month” or “I will save 10% more each month.” In addition, in the current high interest rate environment, you can consider parking your emergency funds in a wide range of options to get good returns, such as in high-interest deposit accounts, Singapore Savings Bonds, T-bills, and fixed deposits
#3 Declutter Debt
According to Chinese superstition, it is customary to clear all personal debt before the Lunar New Year; otherwise, you risk facing difficulties in the upcoming year. Develop a plan to clear debt progressively and set up automated bill payments to avoid late charges. Spending five to ten minutes for each set-up will save you the angst over a late bill charge and the hassle of being placed on hold with customer service for waivers.
#4 Build Up Your Emergency Funds
Make it a point to set aside six months or more of your monthly expenses to meet unexpected expenses or job loss. You could set up automatic monthly transfers into a separate account as you receive your salary. Avoid tapping into this fund unless it is a real emergency.
#5 Boost Your Retirement Savings
Think long-term and start early to reap benefits from compounding returns. For example, did you know that topping up your CPF Special Account in January instead of December can net you up to 20% more interest on top-ups in 10 years? In addition, enjoy dollar-for-dollar tax relief of up to $8,000 when you top up your CPF.
#6 Plan For Your Loved Ones
The new year is also a chance to express gratitude and appreciation to your parents. Consider topping up your parents’ CPF accounts to help bolster their retirement savings. Eligible top-ups will receive up to $600 in matched grants each year from the government under the Matched Retirement Savings Scheme.
#7 Grow Your Cash
After setting aside your emergency funds and topping up your CPF, consider investing the money that you do not need in the next few years to beat inflation. When deciding what to invest in, we advocate choosing broadly diversified and low-cost funds with an asset allocation according to your risk appetite and investment time horizon, such as in MoneyOwl’s Dimensional Funds. May your cash multiply like rabbits!
#8 Go Paperless
Finally, consider e-statements for all your bills and utilities. You get less mail and stacks of paper in your home to declutter after.
And if you need help spring cleaning your finances, we are here to support you like your personal financial Marie Kondo. No matter what your starting point is, our big-picture methodology helps you take control of your financial situation and make your short- and long-term life goals achievable.
Disclaimer:
While every reasonable care is taken to ensure the accuracy of information provided, no responsibility can be accepted for any loss or inconvenience caused by any error or omission. The information and opinions expressed herein are made in good faith and are based on sources believed to be reliable but no representation or warranty, express or implied, is made as to their accuracy, completeness or correctness. Expressions of opinions or estimates should neither be relied upon nor used in any way as indication of the future performance of any financial products, as prices of assets and currencies may go down as well as up. All investments carry risk. Past performance should not be taken as indication of future performance. The author and publisher shall have no liability for any loss or expense whatsoever relating to investment decisions made by the reader.
