Holistic Wealth Planning in 5 Steps (For A New Post-Pandemic World)

The basic rules never change for holistic financial planning in this new era of change.

They always start from protection and ends with management.

These are the 5 steps in their simplest form.

Protect

Save

Invest

Grow

Manage

1. Protect

Protect your assets and yourself from unforeseen risks. You are the income-producing asset and must be protected from all risks in order to get to the next step.

2. Save

Save your money so that you can invest. How? Assuming you are having an income, you will need to save. Saving only can occur when your expenses are lower than your income. Keep your expenses lower than your income, then you can start to save. Keep an expense tracking app or worksheet on a monthly basis. Rule of thumb - Spend only on needs and not "wants".

3. Invest

Invest for the long term and not the short term. Long term means more than 10 years. Short term means anything lesser than 10 years. Focus investing will help you gain more returns in the long term. Diversification is important but do not spread your investments too thin. Focus on high quality funds if you are a funds person. And on equities if you are an equities person.

4. Grow

Grow means monitoring your investments in a systemic way for the long term. (10 years or more). Systematic means monitoring quarterly and apply funds rebalancing strategy. This can be done via advance electronic instructions. Half yearly reviews should be done consistently.

5. Manage

Management of your overall portfolio is the key to keeping a healthy financial status. Risks management is the first step. In order to maintain your investment portfolio till your retirement age, you need to get your basics right and the rest will fall in place. Management of your portfolio for the long term to fight inflation and other unexpected expenses will be the ultimate goals for everyone.

All of us will go through these 4 stages:

Our Birth -> Working Life -> Retirement Years -> Death (End Game)

The only difference is how we lived it.

Often, people will overlooked the assets protection portion and jump right into the investments components.

Once unforeseen situations happen, the whole wealth triangle will collapsed and it will be hard to start all over again.

In summary, this pandemic has clearly illustrated to us the need to go back to step 1, which is to protect our assets & ourselves first. For people that had been practising the above 5 steps, most of them are not really affected by this pandemic as they had savings & investments to tide them through.

For some, they even have the excess funds to further invest during the pandemic and make good gains in their investments portfolio.

Thus, this pandemic seems to have both positive and negative sides for everyone.

Have you started on the 5 steps to holistic wealth planning? Do it now if you have not start anything yet.

Galvin Ang, Performance Coach.