A detailed explanation of the importance of financial planning.

1. WEALTH
ACCUMULATION
MODEL

2. WEALTH ACCUMULATION MODEL
Imagine this is
your lifeline!

3. WEALTH ACCUMULATION MODEL
Your current age is 25, and by
this age you would have
accumulated for yourself
current assets of your own
(e.g.: savings, investments,
property)
Current
Assets
Current Age
(E.g.: 25)

4. WEALTH ACCUMULATION MODEL
Your intended retirement
age is 62, and by this age
Future you would have
Assets accumulated more assets
for yourself!
Current
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)

5. WEALTH ACCUMULATION MODEL
What is your Financial Goal?
Financial Goal = Financial Independence
Future
Assets
Current
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
What is your financial goal when
you retire? What do you want to
achieve then?
For many, achieving their financial
goal means being financially
independent.

6. WEALTH ACCUMULATION MODEL
What is your Financial Goal?
Financial Goal = Financial Independence
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
Let’s look at a typical Singaporean financial goal:
1. Have a house fully paid for
2. Some amount of savings
3. Some amount of investments:
• If we invest our money with returns of 5% p.a.
• $1million invested gives us  $50,000
• $5million invested gives us  $250,000

7. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
Without time and being physically able to
accumulate, you are unable to reach your
financial goal.

8. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
Therefore, the next 37
years of your life is
crucial!

9. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
But what may happen And stop you from
that could halt this achieving your financial
whole process? goal?

10. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
What may happen that could halt
this whole process?
1. Premature Death These are the 3 events that
2. Critical Illness may stop you from achieving
3. Total & Permanent Disability
your financial goals.
The risks that these may
happen are one of the
concerns of people.

11. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
What may happen that could halt
this whole process?
Concern #1: Risk 1. Premature Death
2. Critical Illness Risk Management
3. Total & Permanent Disability
What financial planning does
for you is to help you manage
these risks.

12. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
What may happen that could halt
this whole process?
Concern #1: Risk 1. Premature Death
2. Critical Illness Risk Management
3. Total & Permanent Disability
Concern #2:
Wealth The second aspect that
Accumulation
most people care about is
wealth accumulation.

13. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Current Age Retirement Age
(E.g.: 25) (E.g.: 62) is
This how you calculate your
monthly cash flow.
What may happen that could halt
this whole process?
Concern #1: Risk 1. Premature Death Only when you have positive savings
2. Critical Illness monthly then you are able to do
Risk Management
3. Total & Permanent Disability
something to multiply it.
Concern #2: 1. Cash Flow = Income - Expenses
Wealth
Accumulation Positive Asset
Investment Accumulation
Savings Multiplication

14. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Next information you need to know is your net worth.
Financial Goal = Financial Independence
Time +
Many of us have assets locked up somewhere.
+ $$ + Investments
Future
E.g.: property, investments, fixed deposits.
Assets $$ Invested at 5% p.a.
S$1 million  $50K
If inflation is Crucial Period 5% this year. If your fixed deposits are only
Current expected to be S$5 million  $250K
Assets you interest of 0.25%, you are losing 4.75% of the value of your
giving
money to inflation!
Current Age Retirement Age
(E.g.: 25) (E.g.: 62)
You need to protect your hard-earned savings and make it grow instead of
allowing its value toprocess?that could halt is why you need to park your assets
depreciate. That
What may happen
this whole
Concern #1: Risk 1. Premature Death to make it work harder for you.
somewhere
2. Critical Illness Risk Management
3. Total & Permanent Disability
Concern #2: 1. Cash Flow = Income - Expenses
Wealth 2. Net Worth = Assets - Liabilities
Accumulation

15. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
It is important to know what current existing
arrangements and Age
Current policies you have and how Retirement Age
(E.g.: 25) (E.g.: 62)
much you are covered for.
What may happen that could halt
this whole process?
If your amount of protection 1. Premature Deathwhat you
Concern #1: Risk coverage is
need, you will have a peace of mind. If not, it’s
2. Critical Illness Risk Management
Protection > Needs
time to do something about it. Disability
3. Total & Permanent
• Help you to save on the unnecessary
Concern #2: 1. Cash Flow = Income - Expenses Protection = Needs
Wealth 2. Net Worth = Assets - Liabilities
Accumulation • Good to know
3. Existing Arrangements/ Policies
Protection < Needs
• Help you to do something about it

16. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current S$5 million  $250K
Crucial Period
Assets
Lastly, do you have any immediate
Current Age Retirementconcerns regarding your finances
Age
(E.g.: 25) (E.g.: 62)
over the next 12 months?
What may happen that could halt
this whole process?
Concern #1: Risk 1. Premature Death E.g.: Getting married, buying a
2. Critical Illness Risk Management starting a business.
house,
3. Total & Permanent Disability
If so, we are able to make
Concern #2: 1. Cash Flow = Income - Expenses
Wealth appropriate planning for it as well.
2. Net Worth = Assets - Liabilities
3. Existing Arrangements/ Policies
4. Any Other Immediate Concerns

17. WEALTH ACCUMULATION MODEL
To accumulate this wealth, What is your Financial Goal?
what do you need? Financial Goal = Financial Independence
Time +
Future + $$ + Investments
Assets $$ Invested at 5% p.a.
S$1 million  $50K
Current So what is the next step from now?
Crucial Period S$5 million  $250K
Assets
Arrange for a financial analysis to be done.
Current Age Retirement Age
(E.g.: 30s) (E.g.: 60s)
Start early.
What may happen that could halt
this whole process?
Concern #1: Risk 1. But it’sDeath
Premature never too late now.
2. Critical Illness Risk Management
3. Total & Permanent Disability
Concern #2: 1. Cash Flow = Income - Expenses
Wealth 2. Net Worth = Assets - Liabilities
3. Existing Arrangements/ Policies
4. Any Other Immediate Concerns