The Star: How To Reset Your Financial Goals

On the topic of resetting your finances, Kimberly states that the movement control order (MCO) is the best time to do it as you can take your time to really focus on your own finances. To do this you need to manage your cash flow first, and then focus on building an emergency fund and investment portfolio after.

It is important to push yourself to set your financial goals no matter what your current financial situation is so that you can envision the bigger picture and work towards the future you want to create for yourself. It is ideal to put aside a sum as savings first prior to using it for expenses, as it is a lot more stressful to cut down on existing expenses to save money. Kimberly recommends trying to save 50% of your earnings including EPF especially if you are single and not tied down financially. Budgeting the balance left after putting aside your savings amount will help ensure that you allocate your money to the necessary expenses and any extra money left over can be placed in what Kimberly calls a “fun fund”, for you to spend on what you want without feeling guilty about it. 

Mastering healthy saving and spending habits brings you to the next phase: your emergency fund and investment portfolio. You should have a minimum of 2 to 3 months’ worth of living expenses in your emergency fund. Your investment goals should be such that upon retirement, you should have amassed 10 times of your annual income of capital in various assets. You should also consider insurance carefully and select those that best suit your needs.

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