Invest Fair 2017 - Differences of investing in 20s, 30s and 40s

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Last Sunday, I had a chance to speak at the Invest Fair, together with Brian (ForeverFinancialFreedom), Alison (Heartlandboy) and Kenny (MyStocksInvesting).Thank you everyone who came as I was surprised to see the place fully packed even though there was not many people at the fair that early in the morning.

I actually asked Mark (Editor at MoneySmart), our interviewer why people would listen to us since we are not millionaires or have any proven track record. He mentioned that that's precisely why people would want to hear from bloggers, it's because we are more relatable. We are just another normal person with normal careers and not millionaires and this shows that everyone can do it.

Investing is not a super risky business,  it's not a superhero feat! 

I think we just skimmed through some topics because there was no time, but the main point is to encourage people to start investing. They might not be so useful for people who are already investing though. To summarise for the benefit of the readers, these were some of the things we talked about.

1) In our 20s, as most people just start to get in touch with investing, how should one educate themselves on investing and the fundamentals of financial planning?

Read, read, read. All of us started learning from books. Adam Khoo's books were useful to Brian and Alison while I mentioned "Rich Dad, Poor Dad and  Peter Lynch's "Beating the street". Most importantly, start investing as it's the best lesson when your money is at stake. Kenny's regret was that he would invest more if he could do it once over again. Most importantly, equip yourself with financial knowledge in order to understand what you are investing in.

2) What are the tips for any investment beginner?

Savings is important and invest with money you can afford to lost as we do not want to sell at a bad time. Put aside at least 3 to 6 months of emergency funds too.

Everyone has different temperament and familiarity with different stocks. People should know clearly if they can afford to hold a stock for long term or if they like to trade. The risk appetite of a person is crucial too and that corresponds accordingly to which stocks people should buy.

For a start, we can invest in what we know so as to be more comfortable with what we are buying. Shopping malls like Vivocity (Mapletree Commercial Trust) may be appealing to some people or even F&B industry like BreadTalk.

Diversify accordingly to different types of stocks. You can venture into bonds, unit trust, gold and other asset class. The safest would be the Singapore Stocks Bonds but it also gives the lowest yield. I also invested into STI ETF every month as a form of passive investing.

3) 30s is the time most people get married, buy a house and start a family. What considerations could someone have at this stage?

With dependants, the comfortable level of risk will not as high as when one is single. Savings would also be lesser due to increased expenditures. Endowment and ILP are not encouraged as they are not a good investment tool for the masses.

I increased my amount of emergency funds from 6 months to 12 months and only invested with money I can afford to lose so I can sleep better. I also bought term insurance so as not to leave behind any debts and liabilities to my dependants.

4) Diversify into regional or global stocks, any tips?

I did not buy anything outside of SGX or equities at the moment. Emerging markets could be more profitable as Singapore stocks do not move too much. I feel a bit risk averse to take on foreign currencies and I do not have that much money to play with either. In any case, I could invest in stocks that has global business. For example, Old Chang Kee is debuting their first branch in London soon! Most importantly, do not diversify for the sake of it, it could become deworsify!

5) 40s is the stage when we are reaching retirement age, how should this affect our assets management and investment portfolio?

Just to clarify, retiring is not to stop working but to have a passive income from investing that can substitute income from work. Seems like all of them wanted to 'retire' at 35 and I am quite impressed by them.

I don't think my passive income would be so substantial at 35 but more towards 45 years old, particularly because I am starting my own business now. These first few years of starting my own business will be taxing on my finances as I will have to use my savings to do my business at SnackFirst. My 'retirement' age is pushed back but I find it worthwhile to create my own business and try to challenge myself. In terms of investment portfolio, I guess I might slowly move towards less risky portfolio like increasing my stake in STI ETF and reduce trading occurrence.

Invest in yourself
One thing we do not have time to mention is investing in yourself. Good health should be the most important to ensure we can get enjoy our retirement. Continuously learning new things and revising our financial knowledge are essential to upgrade us to a more skillful person. More skillful means higher pay, translating into higher savings and investment funds!

I am not the most qualified person to talk about investing but if I can get more ladies to be more financial literate and take charge of their finances, I am happy enough. All right, remember to stay healthy, stay skillful :)


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