Life can be unpredictable, and our goals and needs will change as we grow older. While we cannot foresee every small twist in the road, we can predict some of the biggest life needs. Home ownership, raising a family, and eventual retirement are all foreseeable needs, and we can plan for these early. The key is to ensure our financial planning is an ongoing process and at every stage, clearly defined goals help anchor your investment decisions.
Investments should be built for the long term.
“Trading” and “investing” are frequently used interchangeably. Both terms represent putting your money into financial assets such as stocks, exchange-traded funds, and unit trusts to grow your money, but they mean very different approaches. “Trading” activity tends to time the market to buy low and sell high, in hopes to make profits over a shorter term.
By contrast, “investing” means spending time being invested in suitable financial instruments and taking a steady approach to grow the value of one’s investments over the long term. Of course, there are others who take a combined approach of trading and investing to meet their short-term and long-terms goals.
You should not feel a need to conform too rigidly to the financial goals you have right now. It is normal for priorities to change at different life stages.
Whether your main concern right now is a new home, children’s education, or preparing for retirement, you can use Standard Chartered SC Wealth Select to plan for multiple goals leading up to retirement. With the ability to simulate various goals, SC Wealth Select helps you devise a solution tailored to your circumstances and time frame, to improve your odds of success.
The Today, Tomorrow, Forever framework exists across all three phases of wealth.
Today, Tomorrow and Forever
Our ‘Today, Tomorrow, Forever’ approach helps you to ask the right questions at the right time and is intended to guide you through how you can better manage and allocate all your assets and liabilities to meet your family’s changing objectives over time.
Think of ‘Today, Tomorrow, Forever’ as three distinct ‘allocations of money’ addressing your current, future and forever needs and requirements over time. The relative size of each allocation may change with your changing objectives.
As you set out on your wealth journey, it is likely that you would not need to hold many financial assets in your Today allocation as current income would cover most of your expenses. With time, the Tomorrow allocation would simultaneously be in the process of being filled through savings being invested and growing in value, while your Forever allocation would likely be empty for most of that period.
As a result, nearly all assets would be invested in the Tomorrow allocation. Closer to retirement, the Tomorrow allocation should aim to be funded completely, and some assets may move to the Forever allocation. Eventually during retirement, you will slowly spend down the assets earmarked for Tomorrow. All this while the wealth growing in the Forever allocation is unencumbered to allow for appreciation in value.
While the purpose of these three allocations of money may differ, the investment and wealth decisions are governed by understanding how to allocate your assets and liabilities to meet a clearly defined set of goals and objectives for you and your family.
Important guardrails to keep your investing on the righttrack
At Standard Chartered, we have identified five key Wealth Principles that you should use as guardrails when managing and protecting your wealth. Whether you’re new to investing, or have been investing for years, by following these principles consistently over time, and using them to govern the way you manage your wealth, you will position yourself well to ensure your life goals can be achieved.
The five key Wealth Principles - Fundamental principles to guardrail the way you manage your wealth
By creating a structured investment process, we build a trusted relationship with you that delivers solutions unique to your needs, goals, and preferences.
How you manage, grow and protect your wealth is important. At Standard Chartered, we walk this journey with you. Email us today on [email protected] to learn more.
