Expert tips on managing your finances

A Sunday Times Invest Internet-based seminar - or webinar - that tackled the issue of financial planning urged participants to consider the issue of affordability when managing their finances.

The 310 participants were also advised to avoid the undesirable situation of being asset-rich but cash-poor.

The webinar's theme last Wednesday focused on striking "a financial balance between living today and planning for tomorrow".

Financial experts from The Sunday Times, DBS Bank and Manulife Asia laid out strategies for budgeting, wealth accumulation, goal-setting and fulfilling life-stage needs.

Mr Jeremy Soo, managing director and head of DBS' consumer banking group, pointed out that most home-loan customers tend to use their Central Provident Fund (CPF) savings to fund their homes entirely, leaving them with little in the way of a nest egg when they reach retirement.

This is because these customers are likely to use their cash savings to pay for "wants" like cars and expensive holidays, instead of saving.

"It may be prudent to consider using cash instead of CPF Ordinary Account savings to fund housing loans. Besides, the CPF Board pays a risk-free interest rate of 2.5 per cent, which is higher than current mortgage rates," said Mr Soo.

Knowing that financial planning is a daunting task for many people, Mr Jonathan Hekster, regional head of DBS Partnership at Manulife Asia, simplified the financial-planning process into seven simple steps. He also provided five ways to get started, including socking away at least 15 per cent of your income each month.

"If you don't know how much you are spending, start a budget. You will be astounded by how much money just walks out of the door each month," said Mr Hekster.

Sunday Times Invest editor Lorna Tan, who moderated the session, advised retail investors to consider the costs of investments and how they will eat into the returns.

Questions raised by the participants included how to finance a home and how best to protect and grow wealth in the current market conditions of low interest rates and rising inflation. There were also questions on funding children's education, and investments such as exchange-traded funds.

•The inaugural Sunday Times Invest webinar on retirement planning took place on Oct 12. You can view both webinars at and

A version of this article appeared in the print edition of The Sunday Times on October 30, 2016, with the headline 'Expert tips on managing your finances'. Print Edition | Subscribe