Financial Fitness Tips - Part 2

A continuation of Financial Fitness Tips - Part 1.

5. Funds for the future.

Thanks to improved healthcare system, we now have longer life spans and can live well into our eighties. But with the general retirement age in Malaysia pegged at 55, we have a relatively shorter time period to save for our retirement. According to the US Department of Labour, the key to a secure and comfortable retirement is simply to plan ahead. How much do we need to live the lifestyle we are used to? Putting into account the rising inflation rate, it is important to for you and me to invest in a diverse set of funds to significantly minimise risks and reduce the volatility of our portfolio. Diversifying our investment portfolio is one of the most effective ways to protect our investments, especially when we are saving for the purpose of retirement.

6.) Invest regularly.

Experts will tell you that the key to making money is to always stay invested no matter how the market is performing. Adopting dollar cost averaging, or ringgit cost averaging as locally known, by investing regularly. They can purchase more units when prices are low, and fewer units when prices are high. This lowers the total cost per units of investment, and provides a lower overall cost for the investments purchased over a time. Investor should apply the RCA in a volatile market environment as this strategy effectively reduces the impact of market cycles on their investment portfolio.

7.) Taking control

The road to financial freedom waits for no one. As such, the time to start is NOW. American entrepreneur, author and motivational speaker Jim Rohn once said, "You must take personal responsibility. You cannot change the circumstances, the seasons, or the wind, but you can change yourself. That is something you have charge of." You need to resolve to begin grabbing the reigns of your personal financial future. And once you are on the road to financial freedom, you must resolve to stick to it.