How to re-allocate personal finances for a 5/10 year plan? - Seedly



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Asked by Anonymous

Asked on 22 Jan 2019

How to re-allocate personal finances for a 5/10 year plan?

Currently an engineering undergraduate in my final semester. Currently, my personal finances are organized as follows with all amounts in SGD. Cash: 12k (60%) STI ETF: 7.5k (40%) I am planning to re-allocate my finances for the next 5-10 years and would love to get feedback. % wrt to total investment amount. STI ETF: Reduce holdings to about 2-2.5k (20%) Stocks: 4k into USX, 3k into SGX (55%) REIT: Considering MapleTree Commercial REIT, about 3k. (25%) Considering robo-ETFs as well!


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Hi anonymous, sorry for the later reply. Thanks for your question. Just want to acknowledge you for starting out so early!

I am supposing that you will be graduating very soon and going out to work. Assuming that you earn a salary of $4K, I would encourage you to first set aside 3-6 months of your expenses/income as emergency fund. Your $12K in cash can be that fund. Maybe you can set it aside in SSBs for now as it is higher interest than your bank savings.

As for the remaining $7.5K, my preference is that you invest in a diviersified portfolio of low cost intruments such as ETFs or Dimensional Funds. I prefer that over holding STI ETF (STI is a very small index with only 30 stocks on SGX) or just REITs (narrowly focused). There are a lot more opportunities out there - such as the S&P500 index.But if you only have a time horizon of 5 years, I will say put more of your money (like 70-80%) into bond allocation and the remaining in equities. The returns will be lower but with only a 5 year time horizon, you might not be able to take the volaitility risk.

My son is around your age and this is the same advice I give him. Invest in a diversified portfolio of low cost ETFs or Dimensional and regularly save a part of your income into it.

Hope this helps.


Lok Yang Teng
Lok Yang Teng
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Top Contributor (Jan)

Level 6. Master
Updated on 26 Jan 2019

Firstly, what is your 5/10 years plan? If you are unsure yourself, no one can help you with that. What is your purpose in reallocating? What are you getting in USX (I assume US stocks and not US Xpress Enterprises Inc)? Why lump everything into MapleTree and not others such as Capitaland, Ascendas-Singbridge? Do you have sufficient emergency funds? If your you do not have an answer to most/any of these questions or answer is no, I recommend you to think about your objective. It's not just about the percentages/whether it's REITs/high-low risk investments, it's about tweaking the portfolio such that it fufills your 5-10 years investment aim.