Modern Women | Personal Financial Planning

Nowadays, modern women play very important role of taking care of the family members while compete equally in business and positions previously monopolized by men. Due to too many tasks handled by modern women, many women neglect about financial planning. Sometimes, women believe that money matters are the responsibility of men but the truth is not.

Personal financial planning is very important to each entity and not just rely on others. Everyone has had a significant life changing event that made her want to handle her financial future. If you haven’t start planning for your financial future, perhaps it’s the perfect time to start planning and it will be a beneficial to you and your family as well.
Here, I would like to give a few examples of financial management based on true stories and I hope these stories will enlighten your mindset and realise the importance of financial planning.

Cash Management

scenario : Amy has 5 credit cards with a total outstanding sum of $50,000. Her monthly net pay is about $5,000 and she needs to pay the house, car loans montly. Now will she able to save some money every month after deducting all the expenses? Don’t forget that the credit cards interest are high and will accumulate very fast if not being paid fully.

Advice: She needs to review the debt holding cost of each credit card and settle the highest interest rate first. She can contact the credit card company and request them to lower the interest rate. Instead of using credit cards to pay for her purchases, she uses cash so she can focus to pay the credit card debt. Besides reviewing her credit cards debt, she needs to change her spending habits and cut down on unneccessary expenses.

Risk Management

scenario: Amy and her husband, Mark do not believe in insurance and healthcare planning. Unfortunately, she was diagnosed with  breast cancer recently and Mark was unable to pay for huge medical cost. Mark had to borrow money from relatives and friends to make sure his wife received the proper treatment.

Advice: Most of us have insurance coverage but how many of us are aware of the details of insurance policies and whether the insurance coverage is what we actually need? Without knowing the details of your insured policies, you end up with too much insurance or under-insured. Therefore, the best way is to call your insurance agent and  require them to explain the details of your policy. Only then you can decide whether you need more or less insurance coverage especially for diseases affecting women like breast cancer and cervical cancer.

Tax Planning

scenario:Amy has been submitting combined tax assessments with her husband because she thought it would be troublesome to open her own income tax account.

Advice: Actually, husband and wife are eligible to claim a higher amount of relief and pay lower tax if elect to submit separate tax assessments. You may seek for advices from certified financial planner if you want to know more about the ways to save money by submitting separate tax assessments.

Investment Planning

scenario: Amy knows that in order to accomplish her ultimate financial goals – financial freedom. She needs to earn at least 8 % annually on her investments over the next 10 years. Besides, she is willing to accept moderate risk in her investments.

Advice: Investment planning is very important to achieve long term financial goals. It’s good to customize the investment portfolio in order to suit your personal financial needs . You must analyse your current and future financial needs, objectives and risk tolerances. Talk to a certified financial planner if you need him/her to plan better investment portfolio.

Retirement Planning

scenario: There’re a lot of people who can live until the age of 70′s and still healthy nowadays, thanks to modern medical technology which enable the longevity runs in whole world. However, how much retirement money should we saved if we are able to live till age of 70? Please be reminded that our retirement age are around age 55 till 60.

Advice: we should sit down and think properly some of the factors which will determine our retirement money are enough or not.
1. What you want at retirement life.
2. What is your current financial retirement resources including EPF.
3. How much money you need to fulfill your retirement needs
4. Review your financial planning strategy from now on in order to meet your retirement goal.

Estate Planning

scenario: Jessy, a housewife was suddenly widowed because her husband died of a heart attack. The house is still under mortgage and the children still young. Her husband died without a will (intestate), so his estate (house) was frozen and distributed under the Distribution Act 1958. The estate administration process take a longer time and Jessy encountered cash flow difficulties at that very critical period.
Advice: Everyone should set up the will (intestate) earlier because we cannot predict how old we will live in this world. Be prepared early and don’t let your loved one suffer afterward.

Conclusion:
Bear in mind that you are the master who in charge of managing your own financial planning in order to achieve financial goals. It’s never too early to start planning your own financial future.

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