Financial planning doesn’t have to be hard, just start young & be disciplined

If there was a machine to turn back time and advise my younger, 20-something-year-old self, I would have hopped on it and perhaps told him: Please take financial planning seriously. 

Fast forward years later to when I'm 30, a point where I'm quite comfortable with my financial position.

I feel that if I had started my financial planning sooner, I would've reached this stage much earlier, maybe without much of a struggle too. 

Keep to a budget and track expenses

To give some context, while in university, I worked at two part-time jobs while juggling school. 

It is safe to say that money was not really a problem back then. I had a steady stream of income, albeit not as much as what I have now, but sufficient to survive and hang out with my friends. 

Even so, I had a habit of spending all that I had without budgeting or keeping track of my expenses. This habit carried on with me as I started my career, and it impacted my financial goals. 

I wish I had conditioned myself to follow the 50/30/20 rule when I had the opportunity -- 50 per cent of my income goes to necessities, 30 per cent on shopping and self-care, and the remaining 20 per cent to go into my savings. 

Of course, when I was younger, the thought of marriage, getting a car, or even owning a house seemed quite a distance away. But, in reality, starting to plan my finances early would've given me some discipline in preparation for these big-ticket expenses in the future.

Buy insurance younger

Just as I did not have the foresight in planning my savings, I wished I knew the importance of buying insurance early. 

As an introvert who is terrible at making small conversations, every single time I was approached by an insurance agent, I will definitely pull the "Oh sorry, still schooling" card.

I did not see the importance of insurance when I just started working. The thought of having to pay a monthly premium already turned me off. 

As I grew older, I realised how myopic I was back then.  

Buying insurance offers me coverage if I get critically ill to the point of not being able to work, and to cover my hospitalisation bills when I am sick. 

When I eventually got around to buying my insurance at the age of 27, I also realised that the premium could have been cheaper if I had gone for it earlier. 

And it's the same for investments. 

Look, I get that investment is a somewhat scary thing to do. You must be thinking that you need: a) loads of disposable income (where's the money when you are a fresh grad?), b) to do extensive research (when you just completed school) and c) to overcome complex setup processes.

The truth is, you don't need to do any of that to start.

All my life I thought that investing requires a considerable amount of funds and a long time to reap its returns. I didn't even have proper savings, especially at the start of my career. 

I realised later in life that investment is a passive way to grow my wealth in preparation for my future plans, such as buying a house, or marriage. 

Thankfully it's not too late for me.

Enter SNACK by Income

SNACK by Income, in essence, is an app with a micro Investment-Linked Plan (ILP) that allows you to purchase insurance and make investments by just being you.

Wait, micro what?

So unlike a conventional investment plan which requires a fixed, regular premium (sometimes to the tune of a few hundreds), SNACK allows you to invest through pre-determined bite-sized premiums whenever you trigger certain lifestyle activities such as taking a bus, watching a movie, or even shopping.

How bite-sized is bite-sized? It can go as low as S$1.

Here's a totally relatable example: say you take the bus to work. SNACK will know that "hey, that's a lifestyle trigger right there!" and will take the pre-determined premium that you set (say S$1). So if the bus fare costs S$2, you will pay a total of S$3: S$2 for the fare and your S$1 invested into the SNACK app.

Now, what does SNACK do with all the premium that you have accumulated by just being you? It goes to purchase units of the Asian Income Fund. 

By consistently "stacking" these small investments as you go about doing your daily activities, one day, you might just be pleasantly surprised at the investment portfolio you've built up.

How to start SNACKing

Like what many wise men say, it's really as simple as one, two, three.

All you have to do is to download the SNACK app on your phone, and you're ready to start your investment journey.

Next, boot up the app, input all your data using Singpass (recommended), take a short quiz to find out your risk appetite, answer a short questionnaire about investments, input your premium amount to the chosen lifestyle activity and you are ready to rock and roll.

I also realised that the impression that having a big bank account was needed to start investing was not necessarily accurate because SNACK by Income allows you to build up an investment portfolio with minimal requirements. 

The fact that it allows me to automate the habit of investing regularly through small purchases, is really a godsend for a busy professional like me.

I can also select my weekly premium cap. This means I will not be paying too much for a selected lifestyle trigger.

And the kicker? I can actually withdraw the amount that I invested with SNACK by Income at any point without additional charges or fees. From now till Nov. 30, you will get complimentary S$30 credits in your portfolio if you start investing with SNACK by Income.

You can start investing using SNACK by Income here.

Top image via mohamed_hassan/Pixabay

This sponsored article by SNACK by Income made this writer ashamed of his poor financial habits when he was younger.