What to do during the uncertain times ahead?

With rising interest rate, high inflation, Russia's invasion and China's Covid surge going on in the world, the market is expected to be volatile due to the uncertainty. So what do we do?

What do you do when you see your portfolio drops by 20 to 30%? Panic sell? Buy the dip? Or Dollar cost average?

 

Well my solution is none of the above yet… What is especially important to me during such time is A financial safety net FIRST!

 

This to me is an important aspect of my overall financial planning. A sound Financial safety net allows me to have a peace of mind knowing that regardless of what happens in the market, I still have something to fall back on. This gives me the emotional stability to stay rational during such volatile times.

 

The main financial safety net for me is my CPF. It's something that I have been building up for some time and I will continue to strengthen it alongside my other investment by doing voluntary housing refund slowly. Knowing that my CPF will continue to grow at 2.5 to 4% annually helps me to sleep soundly at night during such times.

 

In fact, I will from time to time check my CPF forecast using the CPF calculator when I'm feeling uncertain about the market or even my job. Seeing the compounded amount when I hit 65 is definitely comforting. So I would say before we invest our money in risker assets such as the stock market, build up your Financial Safety Net, CPF for me, FIRST!

On a side note, I have updated the CPF calculator to reflect the 3.5% increase in the FRS. Have a good long weekend and invest safely! 

P.S. Do support me by using my referral. Go to referral for more information on them. Thanks for your support! Happy Value Investing