I'm a fresh grad and I'm taking my finances more seriously now as I'm adulting. What are some money habits that you'd give to a fresh grad as something I should know as I enter the "real world"?

50/30/20 rules

1. Know your financial commitments: this includes any debt, daily expenses, savings for short term and long term and others

2. Plan out and have different accounts for different expenses/savings

3. Know the importance of investing and how to start investing effectively

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1) find out how much money you owe and at what rate per year. Definitely try to clear any debt with interest more than 6% a year as soon as possible.

2) find out how much your family bills are per year or month. This can be the electricity bills, water / gas utility, town council fees, TV / cable / Internet fees, condo fees, food or grocery, mortgage (if the house isn't fully paid up), insurance. Other than just preparing yourself to how finance is like after marriage, it just about being mature and make some contribution to the family to offset your own living cost within your abilities. Take it as paying rent to your parents.

3) really important - ask your parents what insurance policies they have. If they don't have hospitalization / medical insurance, help they get one. You can try to fund it from your medisave.

4) if you must use a credit card, pay it on time and have no unpaid balances. 26% interest rates + late payment fees will sink you faster than you know.

5) do a budget, realistic one. If you haven't done one before, take your bank statements for last three months and get a feel of where your money goes. Make a monthly budget, then as you go along, progress to making it a full year budget. Budgets will never be perfect - you will slowly learn what you didn't budget for. Example medical / dental (but maybe claimable from your employer), holidays, wedding angpows, funerals. It's from learning how you spend your money, then you can start planning how to prioritise your spending and savings.

6) saving goals or sinking funds are really a great idea. Ocbc has saving goals functionality in online banking. I can't say for dbs / uob but I assume they should have it too. I personally split my 360 account into six savings goal with a monthly float. Two days after my pay comes in, like 60% is automatically saved into those saving goals. So when the relevant big ticket items spending comes in, I withdraw from the savings goal to cover for those (eg my annual insurance premiums, or topping up cpf /srs). That way I really know how much is set aside for what purpose, how much I have left to spend etc.

7) when buying stuff, sometimes it pays to do research and compare. Nowadays I most worry only about spending of more than 200 that I will compare where I can get a better deal, and if its worth it. Over time, it pays off because sometimes its just impulse spending (eg clothes / shoes / gadgets) that you dont need and delaying the purchase may just stop you from buying a white elephant.

8) Really ask around for opinions on ILP and Endowments. A lot of times, it's not the right tool for young folks, and they have a lot of upfront fees and costs. Most of the time, you may find some other investment or tool that would suit you at much lower cost. Once you sign into those policies, surrendering them can have huge huge losses like up to 80% of what you paid that you didn't expect.

9) if someone needs to call you out for a coffee to explain a policy to you, ask them to send you the pdf summary or brochure of the policy via mail or email. It's much easier to think whether you need that policy reading through the pdf without undue influence or hard selling. If you are interested, it's not that hard to ask for that coffee to continue learning more. But a lot of times, it will sieve out the stuff that looks bad already on paper that people need to hard sell.

10) learn about fees and where they happen, whether it's insurance, investments, or any other contracts. High fees will absolutely kill any good investment plans that make it look not so good anymore. For investments, I find that total fees above 1% (especially recurring fees) are definitely a no-no. Recognize upfront sales charge, trailing or trailer fees, maintenance or admin fees, distribution costs, buy-sell or bid-ask spreads, management fees etc are all fees. In some cases, they can add up to more than 6% and these are being paid to the middleman.

Firstly, I would urge you to keep investing in yourself, that means continuously learning. You are your biggest asset and it's you who will determine what kind of income you are making. That said, getting into better financial shape is a process and there are a few factors you might want to keep in mind.

1. Always set aside some savings. Whether you are making $2k or $7k, it's always wise to save some money for the rainy day. You don't know when you might need this emergency fund in the future. A good rule of thumb is to accumulate between 3 months to 12 months of your monthly income. A good way is to automate your savings so you won't even have to consciously think about it.

2. Know what kind of lifestyle you want. Different types of lifestyle determine how much you are going to spend. If you are someone who can go on economic rice everyday, then you will have more money to allocate to your hobbies. On the other hand, if you absolutely need to have a car to survive in Singapore, then you might find yourself stretching your finances.

3. Learn to budget. Sometime we might need to spend more to celebrate our best friend's birthday and we will have to exceed our budget. But it's okay, what this mean is that you will have to find some other expenses to cut back on. This will mean forgoing your favorite bubble tea for 2 weeks to stay within budget. With practice you will get better at budgeting.

4. Manage your risk. You may be young and feel invicible but don't get carried away as we will all grow old one day. The cost of medical treatment is rising and you might potentially wipe out all your savings. That's where insurance comes into play. Yes, insurance is an expense if you do not use it so learn about it so you know how to utilize it for your own advantage.

5. Incorporate CPF into your financial plans. Many don't consider CPF "real" money as it is an illiquid account where the government create a forced savings for you. However, CPF can be utilized in a way to help you reduce the cost of your insurance and housing.

The list is non-exhaustive. The earlier you start getting into good financial habits, the greater the control you have on your finances. In fact, getting a trusted financial advisor is a good way to avoid financial pitfalls that you may not be aware of. Good luck and enjoy your journey!