What are some good websites for Financial Planning? A good financial website cannot replace a good financial adviser but it can help to give you some info.
February 2nd, 2010 by ALVIN SOONG
Some Singaporeans may not trust their inner money secrets to a complete stranger but would rather do their sums through internet. However internet websites with some of its financial data and advice, cannot replace a financial adviser.
Internet websites however do have certain advantages:
It will help you ask the right questions when you move on to engaging a financial adviser or you can use the Web’s vast resources to construct your own wealth management plan. And it can be done at any time to divulge how much cash and property - or debt - you have.
There are several websites that encourage visitors to check out their financial health and pick up tips via virtual templates, calculators and games. These also help to work out any shortfalls you face in order to achieve your goals. Here are some tips on what to look out for in a financial website.
1. Reliability
Check out who is behind the website as it will indicate if the content is reliable. Is it a non-profit organisation or a financial advisory firm touting products and services? What are its track record and market reputation?
2. Relevance
A website that caters to the financial needs of Singaporeans would be more useful and relevant than one that does not. For example, financial sites from the United States tend to be US-centric, often making references to 401K pension plans, something lost on most of us. It is important to choose local relevant websites that can also include your CPF for calculation.
In local websites, eg. Some of the online tools in the CPF website have an option to enter your personal SingPass details. By doing so, your relevant CPF details will be automatically inserted into the calculator.
3. Ease in navigating
Some websites use spreadsheets to help with personal budgeting, resulting in a personal income statement and balance sheet.
As most people have some loans, a loan calculator is another useful tool in planning for a mortgage, car or study loan. The calculator should also show the effective interest rate you will pay.
4. Flexibility
Good sites offer the flexibility to develop different financial scenarios and calculate alternative benefit amounts. Some sites also have a save-and-retrieve feature that allows users to save their financial details and simulations. This allows users to review at a later stage and, if they wish, take the next step of presenting this saved simulation when they meet their advisers.
5. Generating a financial plan
A good site should allow the user to generate and review even a relatively basic plan responsibly, added Mr Campbell. It should be user-friendly yet provide a certain level of awareness about the long-term impact of these financial goals.
5. Simple to understand
The subject matter of good financial websites should be presented with as little jargon as possible.
6. Need for professional advice
Still, experts caution that financial websites cannot replace the role of a trusted adviser. As financial planning is a holistic approach, a virtual tool such as a savings calculator can do only so much. Online tools should be regarded more as a way to help one get started. Individuals are encouraged to work with a professional financial adviser who can help them in prioritising their financial goals and establishing the needs and shortfalls. As it is difficult to be objective about your own situation, you will still need a qualified adviser for help and recommendations. A trusted adviser usually helps guide you through the journey and helps you understand the trade-offs within competing goals and helps you prioritise, quantify and put in place customised strategies that work towards achieving your long-term goals.
Here are some recommended financial websites:
1. CPF website (http://mycpf.cpf.gov.sg
The virtual tools will give you a good start in estimating your financial needs. Begin by answering the questions in the IM$avvy Quiz. IM$avvy users can also watch financial videos, attend webinars, watch webcasts, read and comment on blogs and engage in online forum discussions.
Here are some virtual calculators you will find on the website:
# The Savings Calculator will enable you to learn how much and for how long you need to save to reach your financial goals.
# For investments, the Compound Interest Calculator helps you calculate the compounded value of an investment, which you can use as a basis for the projected returns.
# For life insurance, there is the Insurance Estimator. Based on your current assets and liabilities, you will be able to estimate your required life insurance coverage.
# For retirement, Mr Lam recommends the Retirement Saving Interactive Calculator which helps determine the amount of savings you need to retire based on your desired retirement age and lifestyle.
2. Others
For tax planning, you can plan in advance by using the Income Tax calculator to estimate your tax on the Iras website at www.iras.gov.sg
National Financial Education website www.moneysense.gov.sg is also aa good resource for its useful articles and consumer guides.
For shares, www.shareinvestor.com is also a good resource center for education
Info. summarised and extracted from Sunday Times 31st Jan 2010
