Your short- and medium-term financial goals, such as enjoying regular holidays, owning a home, and providing for your children’s education, motivate you to work hard, save and invest. But alongside these, you need to start thinking about longer-term financial planning – how to make your money work as hard as you do so you can leave behind a good financial legacy for your children.
With a sound financial plan in place, you can lead a comfortable lifestyle in the present while preserving enough of your financial successes to pass on to your children. Typically, smart financial planning involves investing in a range of instruments that protect and grow your wealth.
Mary Lim, a business manager in her mid-40s with two teenage sons, tries to strike a balance between immediate and longer-term expenses by focusing on her priorities. “I aim to meet all my needs and still have enough put away to ensure a good future for the children.” she says.
The Lims started their financial planning early on, following a 50/30/20 rule, whereby they allocate 50% of their monthly budget to essential items such as housing, food and transport, and 30% to lifestyle needs, while investing the rest.
“Having contingency plans in place is important as unexpected situations can catch you off guard,” adds Lim. “Which is why we have been considering some insurance-based products that can provide a recurring income for the boys even after we are gone.”
The right insurance-based products may ensure that not only is the family protected in the present, but that you leave them a legacy that may secure their future.
As parents, we all desire that our children are well taken care of and receive designated endowments and inheritance. 45-year-old Shan Ray, an executive with an American MNC agrees. While they still splurge on the occasional family holiday, the Rays have mastered the financial discipline of saving and investing with a longer-term perspective.
To build a worthy legacy that he can leave to his two young daughters, Ray has built a diversified investment portfolio that includes multiple properties, equities and insurance products specially crafted to provide financial security for the girls.
Good financial planning and the choice of the right investments may potentially let you have it all –
a comfortable, even luxurious, life today, with the peace of mind that your hard-earned money is not only protected and preserved but growing over time.
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*Names have been changed for anonymity.