Keeping it Simple
These days it’s all about minimalism. Tidiness and clean-up guru Marie Kondo has become a global phenomenon with her hit Netflix show, capturing the cultural zeitgeist with her philosophy on organising and decluttering. But can the same set of ethos also be applied to tidying up one’s financial life and money management skills?
As financial products become increasingly commoditised, consumers are bound to pick-up all sorts investment schemes or insurance policies that offer very little or almost no differentiation. Kenny Suen a licensed financial planner who is also Chief Marketing Officer of Bill Morrisons Wealth Management thinks one is more susceptible towards cluttering up their finances especially at the wealth accumulation stage of the financial life cycle.
“I think clients haven’t really put a thought to this because they’re so busy at this point working hard at their jobs and building their wealth. It’s like going shopping and you end up buying all sorts of products and policies along the way. If you don’t do a proper housekeeping, you won’t have a complete picture of your finances. Worse still you misplace them and end up forgetting all about it,” Kenny observes.
“It should all start from a clear financial blueprint that sets out key milestones and what you want to achieve. Ideally, this blueprint should have both long-term and short-term objectives. It needs to be practical and tailored to your own circumstances such as your current income, career and lifestyle that you have and desire. That way, you can ask yourself how these [financial products] fit into your needs, so you don’t make abrupt decisions from information that isn’t thorough to begin with from sales or agents.”
Categorising is a big part of the KonMari method which advocates tidying up and separating items by category. For someone who say owns over 10 different insurance policies, categorising may be a good way to start by digging up old term plans and organising them by the type of coverage it provides.