AMA The Fifth Person
Asked on 18 Feb 2019
Hello! Some of the available places to invest are SSB, STI ETF and Robo Advisors
SSB involves the invesment in the future of Singapore by loaning the government some money. The minimum sum to start is $500. The risk level of this is rather low.
STI ETF would be recommended to those with low commitment investing and for those taking a passive way for long term investment. It involves the betting on an index fund which tracks the top 30 companies in Singapore. The minimum sum to start is $100. This carries a rather moderate risk.
Robo Advisors is similar to the purchase of the STI ETF but it is for those who wish to diversify globally. There are currently 3 players offering this service, StashAway,Autowealth and Smartly. The minimum investment can go as low as $1. This carries a moderate risk.
It would be good to research more and see which type of investment that you are most comfortable in.
1) If you have a sum of money, firstly set aside an emergency fund for rainy days.
2) make sure you have protection for your downside, health, critical illnesses, and personal accidents
3) Any FREE cash after point 1 & 2, then take out a portion to invest in the most important thing - your own knowledge.
Buy investing/financial education books: Rich Dad Poor Dad, One up Wall Street, 5 Rules of Successful Stocks Investing.
To start off investing monthly, you can consider looking at ETF such as S&P500, STI. Or Savings bonds such as SSB. After learning the ropes of investing, you can then start off identifying quality businesses to buy in.
Watch online investing videos to learn the ways of Warren Buffett.
You can start looking at index ETF
Before you start investing, it will be best to understand your objective. Here are some questions to help you:
What is your capital?
How will you want to invest your capital? E.g. lump sum or an amount on a regular basis
How long will you want to stay invested? E.g. 10 years
What is your risk appetite? E.g. How do you feel about short-term volatility?
What is your objective for investing?
By understanding yourself, you will be able to determine the type of assets that suits you. Speak with a profesional when in need to gain insights on how to grow your wewalth.
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The first thing to secure is an emergency fund. This should contain expenses of about 4-6 months. Also, consider covering yourself with insurance. Once all of these are secured, the excess amount can be used for investing.
As someone who is new to investing, starting out on your own can be overwhelming. You can make use of a robo-advisor to help you in making investment decisions. One of the strategies that you can start with is the All Weather strategy. This enables investors to get stable returns throughout the economic cycle by creating a portfolio of diverse asset classes.
You can read more about the strategy here.
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Start with the safest options until you have gained more knowledge of investing.
Right now the safest is Singapore savings bonds.
SSBs, STI ETF, robo advisors, CPF. You should do your own research about investments first and learn the basic. Dont just listen to others because everyone is different and have different goals which will have different types of investments. You need to know about the things that you are risking your money.