As the daily number of new community cases in Singapore has declined significantly, our country has eased the guidelines progressively. Undeniably, the pandemic has changed people’s lives, including their travel and lifestyle habits, but this has become the new norm globally.
People have also been allowed to return to work in the most significant easing of restrictions at workplaces since the circuit breaker was imposed in April, and a slow albeit improving recovery is in progress. Although the pandemic has made an impact globally, it has also shed some light on how people should assess their finances once it subsides.
The current pandemic is a clear indication that you should always be prepared for the unexpected. Many may have experienced changes in their financial obligations because of this pandemic and it’s wise therefore to reassess your financial situation during this recovery period.
With the COVID-19 pandemic, people are also becoming more aware of the importance of being amply protected. Insurance plays a key role in this aspect so apart from reassessing your financial situation, review your current policies to see if they are meeting your current and future needs. Below are some things we can do / plan for as we ride through the COVID-19 recovery process:
Plan early for family succession and retirement (or start now if you have not)
The key elements of how you manage your finances during and after the COVID-19 pandemic hinge on your financial planning. Kudos to you if you have already started planning for both family succession and retirement before the pandemic but it is advisable to review your plans as circumstances may have changed as a result of this global situation.
If you have not started, here are some pointers you can consider:
Family Succession Plan: Succession planning and family governance have always been an essential part of successful wealth planning. A carefully drafted succession plan has the potential to deal with the contingencies of a volatile trade environment and ensure business continuity. In times of uncertainty, succession planning will ensure that your businesses and hard-earned wealth do not pass into the hands of undeserving and unintended recipients. Without a carefully drafted will and succession plan, it might lead to unwanted and unavoidable legal disputes which will create displeasure among family members. Therefore, a well thought-through succession plan must be in place in order to save precious time and money.
Retirement Plan: Start planning for retirement early. As accumulation of wealth takes time (depending on our income), the earlier you start, the more achievable your goals will be. By starting to invest in your retirement early on in your career, your funds will accumulate and grow over time, leaving you with a substantial enough fund to fulfil your retirement dreams. Do keep in mind that you are not alone when it comes to retirement planning. It’s best to discuss your options with a trusted financial advisor.
Diversification is Key
When the pandemic was first reported, investments including equities from booming sectors such as aviation plummeted and wiped out years of accumulated gains. Learning from this, it is clear that diversifying your investments is important for wealth preservation.
According to the latest news report, the Singapore economy is estimated to shrink 6% this year due to the heavy impact of the pandemic on key sectors including service, transportation and tourism-related industries. This demonstrates that a diversification strategy is even more relevant today as companies of all sizes can be badly affected by the COVID-19 disruptions.
To some, financial planning can be an arduous task or perhaps you just do not have the time or knowledge to do it. Rest assured that you are not alone in this fight to recovery as Prudential is here to assist. We introduce to you Ascend by Prudential. Ascend is a dedicated programme aimed at helping affluent Singaporeans achieve their goals – be it retirement, children’s education, financial goals and even protection goals.
This article is for your information only and does not consider your specific investment objectives, financial situation or needs. We recommend that you seek advice from a Prudential Financial Consultant before making a commitment to purchase a policy.