New to the saving game? Start with these three steps.
If you’re at sea about how to start, here’s what Gina Heng, CEO and co-founder of private investment firm Marvelstone Group, advises.
Find out how much and how often you can save
Track your spending to determine a pattern. If you’re mindlessly spending $150 a month on coffee, try reducing this and see if you miss the money. Do the same with non-necessities, and slowly increase the amount you save until you’ve reached a point where you feel strapped for cash. This will give you an indication of what your saving limits are. Suddenly carving out a lump sum to save will only cause withdrawal symptoms.
Create small goals Have goals that span the next three, six, 12 and 18 months. Rather than thinking “I want to be a millionaire by 50”, go with “By the end of this year, I would like to have saved $5,000”. It’s easier to calculate how much you must save to get there. Share these goals with your friends so you’re accountable. From there, build a realistic long-term goal. Use tools like a CPF calculator (find it on the CPF site) to see how much you’ll have in your retirement fund – it will help you make educated decisions.
Find a financial strategy that works for you Once you’ve hit your monthly goals, you also need to ask yourself what you intend to do with the money. You may want to speak with a financial adviser on possible investment plans, or use the savings as down payment for a house or even to start a business.