Financial planning is one of the important aspects that has to be considered for realizing your financial goals. However, the first step is to determine and set realistic financial goals which may include building a home, starting a business, early retirement, traveling to a far-away destination, and others.

Here are a few things that have to be considered for achieving a financial breakthrough before reaching 35.

Do you have an emergency fund?

Emergency funds come in handy while dealing with unpredictable events such as medical expenses, repairs and renewals or any other urgent debts that must be settled right away. It is essential to save money out of your income and to achieve this 50/30/20 can be applied; 50% on needs, 30% on wants, and 20% in savings. The Household Expenditure Survey of 2012-2013 that households were able to save 55% of their savings and this indicates that even though the cost of living is higher, households are still able to save some portion of their income. Thus, a projected emergency income that is best suited for your requirements; 6 months’ salary or total monthly expenses for 7 months, has to be saved for resolving emergency financial woes.

Multiple income streams

By creating multiple income streams, you will be able to maximize your financial potential and a certain amount can be transferred to retirement savings. One common way of income diversity is the salary/income earned by the spouse. There are other ways to increase the income, such as investing in a basket of high-yield and defensive blue chips such as Singpost, STE Engineering, banks, and IT stocks or short-term government bonds which enables to achieve a dividend of 5% or more. However, the opinion and advice of a trusted financial planner have to be considered while investing in stocks or bonds.

Be almost without debts

The increasing cost of living and rising aspirations has resulted in many individuals struggling to cope with the never-ending demands, resulting in increasing their debt margins by availing loan facilities such as fast cash loan in Singapore. According to the Department of Statics, the average debt of a household is about $57,637 per capita as on 31 December 2017. A recent report by HSBC reveals that the main reason for the increased debt crisis is because of over-spending (49%), followed by retrenchment and pay cuts (46%). Therefore, it is important to curtail unnecessary expenditures in order to remain debt-free.

The investment portfolio for retirement

Majority of the people are concerned about retirement as many individuals end-up in a “time-rich and cash-poor” condition. According to the Ministry of Manpower, the official retirement age is 62, but employers try to lay-off older employees as part of their restructuring strategies. Hence, it is essential to design a retirement portfolio consisting of CPF (Central Provident Fund) or schemes run by financial institutions such as NTUC Income, Manulife, and Aviva. These plans enable to cater to your normal living expenses and contingency funds as and when required.

Although there are multiple options available, such as reaching a private moneylender for realizing the financial goals, it is essential to reach certain milestones to ensure that your finances are on the right track.