Vanessa Lim is often accused of being “kiasu” (Hokkien for fear of losing out), when it comes to managing her money.

The general manager of her father’s furniture business is covered by 11 insurance policies and saves half of her four-figure salary every month. And she is only 30 years old.

Yet, she notes, amid frailties and uncertainties from the Covid-19 crisis, being kiasu is becoming more praiseworthy than derogatory. The pandemic justifies her belief in being prepared for sudden shocks.

What’s behind her cautious approach? 

About seven years ago, her close friend lost her husband to cancer. He was in his late 30s. 

If not for a life insurance payout that she received upon her husband’s death, she would have been weighed down by the financial burden of his cancer treatment. 

“That had a significant impact on me and I realised that we should never take things for granted,” says Ms Lim, who has had her share of personal struggles too. 

Her father suffered a stroke when she was just 10 years old. Three years ago, her younger sister suddenly lost consciousness — suffering a split lip and broken front teeth. In both instances, her family was able to defray large hospital bills with medical and personal accident insurance.

What’s her strategy? 

Ms Lim has amassed an impressive portfolio of insurance plans over the last eight years. 

She has one policy each under five types of health-related insurance: Hospitalisation, life, critical illness, disability and personal accident. Some cover the costs of medical treatments and procedures, others provide a lump-sum payout.

Those are on top of MediShield Life and CareShield Life.

“I’d rather pay now when I don’t have any pre-existing medical conditions. Should I ever have to make a claim, I’ll be able to do so without any worries.”

All Singaporeans are covered by MediShield Life, a compulsory basic health insurance plan that subsidises the cost of treatment in public hospitals. CareShield Life, launched on Oct 1, provides lifelong monthly payouts in the event that the insured has a severe disability and requires long-term care.

Ms Lim and her husband (above) plan to boost their savings with three endowment plans to have a child and retire at 55. PHOTO: VANESSA LIM

What’s her long-term plan?

She and her husband, a research consultant who is also 30, are working towards two milestones: Having a child and retiring by the age of 55. They were married last year and live in a four-room Housing Board flat.

They have three endowment policies and plan to sign up for another to boost their savings.

How does she manage to pay for so many plans? 

Ms Lim sets aside about 25 per cent of her salary every month to pay for her insurance premiums. She watches her spending and gets by on a smaller budget than her friends.

“It’s worth the effort. I’ll see the benefits later on when, for example, I can use the payouts to fund my child’s education.”

For now, the couple is also building their nest egg with other investment instruments and aims to set aside half of their respective incomes every month as savings for their retirement goals.

Says Ms Lim: “I would like to retire early and, most importantly, retire without worry. This means I have to start my financial planning early so I have a longer lead time to build my savings.” 

A piece of advice

New to financial planning? Great Eastern financial representative Andy Seng answers some burning questions to help you get a head start on the future.

Q: Financial planning can be expensive, especially for fresh graduates and young working adults. When should one start?

There’s never a perfect time to start. As wealth grows, so do expenses and responsibilities. We should start immediately within our means to be prepared and protected for the future before it becomes urgent.  

Q: How should a person determine which plans are more important to have?

Every individual is different and will have their own concerns. But the Covid-19 pandemic has shown that unexpected illnesses, healthcare and the loss of income are key concerns, and that’s where we can protect ourselves first before looking at investing and saving for the future.
Q: Financial planning is a long-term commitment. What qualities should one look for when choosing a financial representative to manage your portfolio?

Someone who is patient and willing to listen to your needs, who is experienced and passionate about helping you plan well for the future.  Most importantly, someone who treats you like family and puts you before themselves.

Early financial planning matters to those near and dear to you. Find out how and why.

This feature is the first of a four-part series by Great Eastern.

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