Is it possible to make financial plans without hiring a financial planner? [Guest Post]

Maybe you have wondered in the past whether it is possible to make some of the financial plans such as retirement strategy and investment management of your own or not. If you are still wondering on the issue than here is the answer – yes, you can! Making your financial planning effectively without paying for a financial planner is very well possible if you know your financial position right and are sure what to expect in future. For instance, if you have a good idea on how much your current yearly expenses are, how much will the average Inflation be in the coming years, how much you need at your retirement time, then you can make the investment management and retirement strategies all by yourself.

Life expectancy is an important variable while making retirement plans. Singaporeans now live longer compared to earlier years. Life expectancy for males born in 1957 was 59 but now it has gone up to 79. For females, it used to be 63 and is now 84. Retirement age is 65. So on average a male will have to plan for that extra 14 years while a female will have to plan for 19 years.  It is not that difficult to plan for it if you have a clear idea about what you want. You can do it yourself and save the money that you needed to give the financial planner. For a straight forward retirement planning and investment management, you should follow these procedures:

Step 1: Calculate your current yearly expenses.

Step 2: Roughly calculate how the Inflation would act in the years to come.

Step 3: Calculate how much money you should save per month from your income in order to have your desired level of money after retirement.

Step 4: Evaluate and clearly understand your own investor type.

Step 5: Understand your tolerance for risk.

Step 6: Determine how your current holdings fit your requirements.

Step 7: Make a concrete investing strategy.

Step 8: Monitor your investments time to time and reallocate if necessary.

Most of the information and details about the retirement plans and investment options can be extracted from MoneySENSE - A National Financial Education Programme's website and iMoney. Both these sites present initiatives from the government, industry and public sector to enhance basic financial literacy of the consumers. Once you gather all the information, make a comparison and take decision on how to go about.

However, no matter how good the investing choices are, if it is made outside the framework of a larger plan, trouble is evident. "We'll work out the details as we go along" approach will not work. You have to make a concrete plan and work on it. For instance, having a spending plan and budget is quite important in order to come up with a decent plan. These two work as absolutely essential tools. Without a spending plan and a budget layout, you will not be able to wisely implement saving and investing strategies.  

It is better to start planning at an early stage so that more dividends are ensured at the time of retirement.

iMoney Singapore helps people make the right decision on financial planning.

The above article is contributed by iMoney Singapore