Last Updated on May 1, 2022 by Chin Yi Xuan
Happy November everyone!
This is crazy. With all the things going on around us, there are only 2 months left in 2020 – time certainly flies regardless of what’s happening, don’t you think so?
Alright, back to the topic:
Personal Finance is never really ‘personal’.
When I first started working, my perspective towards money & personal finance used to be very ‘personal’:
I started an emergency fund with the purpose to prepare myself for unexpected incidents in my own life (eg. retrenchment).
I looked into my own insurance coverage to see if I was well-protected.
As I grow up (I am 26 this year), I realize that it is not enough:
My parents are stepping into retirement age. If I am lucky, I might get into a relationship and start my own family down the road. So, I started to ask more questions:
· How much cash am I able to fork out if something were to happen to my family members & loved ones? (eg. medical expenses & care, surgery)
· Are my family members well-insured? Do they lack any specific coverage as they step into retirement age?
· Should I start to save & invest more to prepare for my own family in the future?
Some of you might come from a family background with high financial literacy. Your parents are well-insured and have enough for retirement, emergency, and medical care – well, good for you.
For most of us, our parents are either the ones that ASSUME that they are financially equipped BUT in reality, they are not (especially insurance coverage). Else, they are not ready at all to face any financial & health emergencies and conditions.
If you fall into either of these categories, I highly recommend you to start asking questions and shifting your view of personal finance from just you to a bigger picture.
Start looking into your emergency fund and savings. Do you have enough liquidity to support any emergency needs in your family?
Chances are you might have saved enough for yourself, but not for your family.
Dig out your family members’ insurance policies. Reach out to a proper & reliable financial planner. Are your parents well-insured?
Chances are your parents might be (severely) underinsured. It could be because they have always assumed that they have enough, or their own insurance agents are doing a bad job in following up with them (p.s. I have a very bad experience with how my parents’ agents do follow-ups).
Here’s the reality:
The less financially aware your loved ones are, the less ‘personal’ your personal finances are going to become.
But not all hope is lost. Here’s the silver lining:
The earlier you realize and accept that personal finance is never really ‘personal’, the better.
This means that you can start taking action and plan your financials in a more holistic way, instead of just for yourself. (eg. allocate more to emergency fund, spend rationally, invest)
If you are lucky, you can detect financial weaknesses in the people you care about earlier and do something about it.
Simply put, you can prepare ahead for financial needs that would otherwise catch you off-guard if you ASSUME things are all alright and are not prepared for incidents other than yourself.
Hopefully this week’s newsletter is enough to trigger some awareness in you, as this is something that I am personally going through as an adult as well.
As always, if things ever feel overwhelming to you (it was to me), please seek out help from a proper financial planner (I get help from them too!). Check out my experience working with a licensed financial planner and get a free consultation session – click HERE for more info.
Till next week!
Yi Xuan
