Investment suggestions for 20yo female undergrad? Have about $60,000 savings currently.? - Seedly
 

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Investment suggestions for 20yo female undergrad? Have about $60,000 savings currently.?

I've started teaching tuition to JC kids since entering uni so I've saved up pretty much, albeit already having a decent sum of savings. Recently just opened the SCB Jumpstart due to high interest rate of 2.00% with no catch, so I’ve parked $20k savings in there purely for interest income. Currently, I’ve $25k locked up in a fixed d, maturity Feb 2020. Also doing DCA $300/mth into Stashaway (22%) and seeing some decent positive returns. Am open to take higher risk investments (eg stocks)

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Hi Joey,

Given your cash reserves and that you'll probably graduate in a year or two, you might want to look at sorting out your own insurance coverage first. Your savings can easily cover the costs for 2 years until you get a job. Focus on hospitalization and critical illness, taking advantage of the fact that you are young and healthy, before you start exploring investing.

Once that's done, estimate your expenses for 12 months, and keep that in a high interest savings account. This is your rainy day fund, never to be touched unless there is an emergency.

Any other amount above and beyond that can be earmarked for investment. Notice I said earmarked because you don't deploy everything at one go. Take time to understand all asset classes, their pros and cons, before starting to enter the markets. There are many options that you have to invest, and you have the most important resource, time, on your side.

I would venture to say that you would probably have around $40K earmarked at this point. You can open an investment account first, such as POEMS, in order to prepare yourself. Start small, maybe deploying 1/3 of your $40K into something diversified first, before putting another 1/3 into a few shares that you wish to get, and the last 1/3 can be used to do DCA or kept as a warchest. Once you start working, it will be advisable to continue to add to your position, so that you can build your portfolio faster.

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Bjorn Ng
Bjorn Ng
Level 6. Master
Answered 1d ago

$60K at 20!? Wow! I think at 20 I was only at $600 HAHAHA. Great job to you!

It seems you have sorted out your allocation pretty nicely! If you are looking for more higher risk, I would suggest you to begin by reading investing books first, build up that knowledge. Begin exposing yourself investing forums such as Hardwarezone Money Mind, InvestingNote, Investing.com etc. If you are uncomfortable venturing out of SG for now (like I was), try taking a read of SG Real Estate Investment Trusts (REITs), they are not that hard to understand, I literally started through reading Hardwarezone on how to open a brokerage account.

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Valerie Law, Cfa
Valerie Law, Cfa
Level 2. Rookie
Answered 12h ago

Hi Joey, having this amount gives you more avenues to allocate your money on meeting various needs as they come up in the next decade.

Speaking from a lady's perspective and as someone who has worked in the investment field, you may want to consider putting aside some money to invest in furthering your education. The world is changing rapidly as we speak, and using the money to learn new skills 3 - 5 years after graduation is not uncommon. Many of my peers went on to pursue Masters, CPA, CFA, or kick-start their passion projects, which helped them to move up their careers or ventures.

Another thing to bear in mind is the liquidity you may need as you reach around 28 - 35 years old. I faced a huge drawdown of my savings as I paid for my new house and its renovation. If your future husband is Singaporean, he will most likely start his working life later than you due to national service, and thus, may not have accumlated so much savings as you. (Of course, that is not a concern if you have other loved ones funding your downpayment). So, putting all your money in volatile assets may mean that you may be stuck in an "illiquid" situation when the drawdown arises. By Illiquid, I mean that the price is non-existent or unfavourable.

I agree with some of the commentators here that you should start investing in small chunks and then get to know each instrument better along the way. Good luck!

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Junus Eu
Junus Eu
Top Contributor

Top Contributor (Nov)

Level 9. God of Wisdom
Answered 3d ago

Kudos to saving up $60k at 20! Super proud of you :)

I would suggest maxing out the high i/r accounts, and starting to study the different asset classes so that you understand what you are potentially putting your money in.

For stocks, it takes time to read up, so it would be good to pick a few companies and industries, and go deep into their annual reports. Analyst reports are nice to have, but ultimately you would want to form your own opinion and conviction.

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Wilson Nid A Break
Wilson Nid A Break
Level 6. Master
Updated 4d ago

Willingness to take risk and the ability to take risk is 2 different concepts.

You will need to build up that ability to take risk which include reading up how to pick,invest, diversify, rebalance a portforlio of indivdual stocks and/or bonds. A good book to start will be the Intelligent investor by benjamin graham. Meantime, save a portion of money aside for individual stock picking until you are ready to made your first foray.

All the best!

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Daryl Liao. Full Time Investor.
Daryl Liao. Full Time Investor.
Level 4. Prodigy
Answered 8h ago

Wow. Congrats on achieving this considerable amount at such a young age Joey!

No doubt that you are on the way to great wealth.

My advice would be to first sort out your insurance coverage.

Build your knowledge through books, investing blogs.

Explore the investment options you have.

If you head into stocks, understand how to analyse companies as businesses.

A good book that i read when i just started out is The 5 rules of successful stock investing by Pat Dorsey. Still my fav recommendation for my friends!

Start with small chunks of investing to get used to the volatility and managing your emotions.

All the Best!

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Choon Yuan Chan
Choon Yuan Chan
Level 7. Grand Master
Answered 1d ago

Wow you are a role model lady! we should set you as a good example.

To start on investment, i would suggest that you start studying up on accounting. If your university offers financial accounting and finance modules, you should take it to deepen your investment knowledge. After which you can start on your own investing.

However, if you think learning investing is too difficult, just consider investing in the STI ETF through a DCA method

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Jeremy Chia Ming Wen
Jeremy Chia Ming Wen
Level 3. Wonderkid
Answered 3d ago

Hi, it looks like you are a candidate for a more aggressive portfolio.

You tick all the boxes. Based on your description, you are a (1) young investor with a long investment horizon, (2) high income generation from your tuition and (3) have a tolerance to higher volatile assets.

Based on your profile, I think you can consider putting some of your investments into low-cost index-tracking ETFs such as Vangaurd Funds. You can also consider REIT-ETFs that give you exposure to the REIT market in Singapore.

If you want to manage your own portfolio and invest in stocks. I suggest reading One up on Wall Street by Peter Lynch, a great book for beginners. It will help you get familiar with how to pick stocks that can do well over the long-term.

I invest solely in stocks and I detailed why my portfolio is so stock-heavy in an article I wrote on my blog.

Hope this helps! And happy compounding!​​​

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I'll suggest that you get your insurance protection and medical in place first before going further. Premiums will be cheap at your age and furthermore it's definitely to your advantage to be insured when still young and healthy.

Seems like you are already doing quite a bit on your own. Why not explore the different investment workshops out there and find a mentor to guide you further? You will shortcut the learning process and reduce potential errors that you will likely encounter if you were to go at it alone. Things to look out for are the mentor's track records, how long he/she has been training others, the size of community he/she has built, the records of the community members. Try to avoid those trainers who are very ra-ra as based on personal experience they are just fluff. I've been to several paid workshops and have benefitted tremendously and am using the methods taught to build my early retirement vehicle.

Hope this helps and all the best in your investment journey.

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Kenneth Quek
Kenneth Quek
Level 4. Prodigy
Answered 6d ago

Stashaway is stocks. Unless you mean you are ready to stock pick. In which case, education is your best bet and your question should tilt more towards what to read rather than what to buy.

Read up more about passive investing, value investing, factor investing. See which one you believe in or have time for.

I'm sure there are even more types or styles of investing. Have fun reading up.

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Before you start investing, it will be best to understand your objective. Here are some questions to help you:

  1. What is your capital? In your case, $60,000

  2. How will you want to invest your capital? E.g. lump sum or an amount on a regular basis

  3. How long will you want to stay invested? E.g. 10 years

  4. What is your risk appetite? E.g. How do you feel about short-term volatility?

  5. What is your objective for investing?

Next, undersetand your entire portfolio first - know its risk, return, potential, and limitation. From there, look for tools that complement your existing portfolio and reduce the overall risk, e.g. overexposure.

You can conisder bonds, ETF, shares, blue chips (e.g. DBS), options and even investment-linked policies (those without insurance charges). With the right planning, these tools can integrate into your portfolio and help you achieve your financial goals.

Here is everything about me and what I do best.

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Um wow - teaching those JC kids must be lucrative - 60k @ 20 is amazing!

Your overall approach solid - I'd say perhaps review the asset allocation (20 + 25 in cash looks like a lot for someone who is young and I expect no real dependents?)

Not sure what your Stashaway investment choice like - but just go on the higher risk modes there is a solid choice while you focus on education/career.

PS just side note - you mentioned "female" in headline - I wonder if advice would be different for guys!

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