Some visitors to my blog sent detailed information about their personal financial matters and asked for my advice. I am not able to spend time to provide detailed personal advice on specific investments that suit their needs.
If you are in this situation, I suggest the following approach:
1. Read the FAQs in my blog and website and be educated about the financial matters
2. Find a financial adviser whom you can trust (i.e. someone you know or recommended to you)
3. Get the financial adviser to advise on your personal investments for a fee.
4. Ask the financial adviser to disclose the commission that they earn on the products that you buy.
Sunday, January 20, 2008
Goal: to achieve $1.2 million in 25 years
Hi Mr. Tan,
I target to accumulate $1.2m in 25 years time. I now save $18,000 a year in insurance premiums. I wish to increase it to $24,000. My savings in CPF is capped at $17,000 a year. How can I make my savings grow faster?
REPLY:
If you save $24,000 a year and invest to earn an average of 5% per annum, you will get $1.14 million at the end of 25 years. Your savings of $17,000 in insurance policies probably earns for you a return of 3% per annum (just a guess). This will accumulate to only $0.65 million in 25 years time.
You can make your savings grow faster by earning a higher rate of return in a diversified, low cost, equity fund. You may wish to consider terminating some of your insurance policies, and investing the premium to earn a higher return.
Read this FAQ:http://www.tankinlian.com/faq/savings.html
However, you have to bear in mind that $1.2 million in 25 years time is worth only $0.73 million in real terms, if you discount for inflation at 2% per annum.
I target to accumulate $1.2m in 25 years time. I now save $18,000 a year in insurance premiums. I wish to increase it to $24,000. My savings in CPF is capped at $17,000 a year. How can I make my savings grow faster?
REPLY:
If you save $24,000 a year and invest to earn an average of 5% per annum, you will get $1.14 million at the end of 25 years. Your savings of $17,000 in insurance policies probably earns for you a return of 3% per annum (just a guess). This will accumulate to only $0.65 million in 25 years time.
You can make your savings grow faster by earning a higher rate of return in a diversified, low cost, equity fund. You may wish to consider terminating some of your insurance policies, and investing the premium to earn a higher return.
Read this FAQ:http://www.tankinlian.com/faq/savings.html
However, you have to bear in mind that $1.2 million in 25 years time is worth only $0.73 million in real terms, if you discount for inflation at 2% per annum.
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