Recently, we were at FRANK by OCBC’s 3rd birthday bash and we had an awesome time eating delightful cupcakes, drinking wholesome specialty coffee, and learning 4 useful tips to manage our finances!
If you are a youth between the ages of 15 and 24 years old, we are pretty sure you have big goals and dreams for your future and if becoming a millionaire is one of them, we want to share with you these 4 useful tips that FRANK by OCBC taught us!
FRANK Tip #1: Save Before You Spend
The first step to financial freedom is to have a habit of saving regularly. You can choose to save your money in the bank or you can take up a long term savings plan that guarantees your principal and offers you an attractive interest rates.
If you are keen to start saving up, the OCBC Monthly Savings Account is a good start because it offers you 0.4% interest rate a year if no withdrawal is made within the month!
We advise that you keep this savings account as a spare account for your savings and do not make any withdrawals until you save at least 6 months’ worth of income or in case of dire emergencies.
FRANK Tip #2: Amplify Your Wealth
Inflation is an inevitable problem in our society and there is no way we can escape it unless the real value of our money grows. Your $1 bill today may only be worth $0.50 a few years down the road and it will definitely erode in value over time.
As Einstein said, “Compound interest is the 8th wonder of the world. He who understands it, earns it; he who doesn’t pays it.” A monthly savings account only earns you 0.4% interest rate while the inflation rate in 2013 was 2.4%. Hence, the interests that you earn is not able to counter the effects of rising costs if you keep your savings in the account for a long time!
If you are an experienced investor, you would probably invest a lump sum of money at one ago but if you are new to investing and you don’t have much money to begin with, you can still invest by setting aside a regular amount from as low as SGD$100 to invest regularly with the OCBC Blue Chip Investment Plan.
Compounding may be slow process but it is a sure way to grow your money by reinvesting your precious earnings. It’s like building a giant snowball; its rate of growth amplifies as more snow sticks to its increasing surface.
FRANK Tip #3: Protect Yourself
It is important to protect yourself financially and one way you can do that is to insure yourself. You will never know when a crisis will strike and even though you may be young, fit, and healthy; getting a health insurance is important In the event you need to be hospitalised and treated.
The same goes if you are travelling abroad. Always make sure you get a travel insurance before heading overseas because you will never know when your baggage would go missing or when your flight would be delayed and for how long.
FRANK Tip #4: Enjoy Small Indulgences
To live life to the fullest, enjoy all that it has to offer. Reward yourself occasionally but make sure you pay your dues on time and in full. A credit card can come in handy but don’t abuse it. This way, you can meet your financial goals while indulging in the pleasures of life.
So there you go!
Start applying these 4 FRANK Tips and you are well on your way to achieving big goals in the near future!
Here’s wishing FRANK by OCBC a happy 3rd birthday once again!