1. Are you a super saver?
A. No, I live from pay cheque to pay cheque.
B. I try to put aside some savings each month.
C. Of course, I have a six month emergency fund.
2. How do you keep track of your monthly expenses?
A. I don’t.
B. I sometimes check my account balance.
C. I have an Excel spreadsheet or money monitoring app that I regularly update and review.
3. What are your spending habits like?
A. I buy what I want – even if it means maxing out all my credit cards.
B. I keep an eye out for sales and promotions to snag the best deals.
C. I wait for sales, and only buy things I know I’ll use for a long time. I also only buy what I can afford.
4. Necessities aside, where does most of your money go?
A. Concert tickets, eating out or clothes.
B. I prefer to spend on experiences and well-made items that last me a long time, rather than on fleeting pleasures.
C. I give myself the occasional treat but save as much as I can.
5. Before making a major purchase, you:
A. Just do it, no questions asked.
B. Head straight to the bank for a loan.
C. Work out whether I can handle both loan repayments and interest. If I can’t, I defer the purchase or find a cheaper alternative.
6. How many of these insurance policies do you currently pay for?
- Life insurance
- Hospitalisation insurance
- Critical illness insurance
- Disability insurance
- Retirement annuity plan
B. One to three of the above.
C. All, if not most, of the above.
7. Is retirement planning a priority?
A. Am I supposed to be thinking about that already?
B. If I have any cash left over each month, I put that into my savings.
C. At least 10-20 per cent of my monthly pay goes straight into retirement savings.
8. Do you have these essential documents in place?
- Lasting Power of Attorney
- Advance Medical Directive
A. None of the above.
B. One or two of the above.
C. All of the above.
Feeling satisfied with your answers? Some of us are probably mourning the money we could've saved or invested.
ONTO THE ANSWERS
Mostly As: Impulsive Toddler
Reality check: You need an intervention. Curb frivolous spending before you develop hard-to-break bad habits or end up deep in debt. Yes, those limited-edition makeup palettes are gorgeous, but before making a purchase, think: Is it a necessity? When in doubt, see if you still feel the same way about it in a few weeks. What you need is a piggy bank. Stat.
Mostly Bs: Budget Novice
Well, you could be a little more organised, but it looks like you’re on the right track to financial maturity. The next step might be to start thinking about investing your money and preparing for retirement. Life’s a marathon, not a sprint. The earlier you start, the more time your money has to grow. Start by investing a fixed amount every month. Choose a straightforward option, like a global equity unit trust – it’s a fund that’s managed by a professional fund manager, who invests the monies into global stocks. You can start small, but over a decade this should grow into a sizeable nest egg.
Mostly Cs: Financial Sage
Looks like you’ve established good spending, saving and investing habits. You probably avoid buying full price where possible and plan ahead so you know what to get when the sales come around. Just make sure that you keep up to date with your changing financial needs at diff erent stages of your life (think: housing and car loans). Even as your financial obligations increase, resist the urge to cut back on the amount you’re putting away for investment each month. Instead, reduce discretionary spending, and prioritise where your money goes.
This quiz was created together with GYC Financial Advisory, an independent financial advisory firm in Singapore.
This article was first published in the March 2017 issue of Her World.
READ MORE: First-world problems? Here's how you can live comfortably on a lousy salary. How to save money when you're shopping for groceries, and five situations that will make you spend more money than you need to.