Have an emergency fund It is also prudent to set up an "emergency fund" that can be easily accessed in case you lose your job or face other out-of-the-blue events.
Once you start investing you may not be able to offload your stocks easily or may have to take a large loss on the sale.
Mr Vasu Menon, vice-president for wealth management Singapore at OCBC Bank, recommends setting aside six to 12 months of your monthly expenses in the emergency fund, while American financial adviser and television host Suze Orman suggests at least eight months of expenses.
Mr Menon said: "If you lose your job, the cash can help you to meet your monthly expenses until you find a new job, which may take as long as six months or even more."
Ms Tok advocates calculating the emergency fund in terms of monthly salary - her advice is to have six months of income before exploring ways to invest excess savings and generate higher returns.
Start your investment journey
With all these building blocks in place you can now start investing.
This essentially involves harnessing your savings or excess money to work to generate more cash. Property and stocks are the most common investment classes in Singapore but a private condominium unit can cost upwards of $1 million. So, most young people start with shares, which can be had for as little as a few hundred dollars. The stock market has a wide selection of large counters - called blue chips - to medium-sized and smaller companies.
"For young people with a good risk appetite and starting out, they probably can afford to take a long term view of their investments and so they can afford to invest in riskier products with good long term fundamentals," says Mr Menon.
"In this regard, it makes sense for younger people to put their savings to harder work to build up their wealth instead of stashing most of their savings away into bank deposits."
Of course, investing in any stock comes with risk, and you may at some points find your investments in the red.
You can choose to spread out your investments over a basket of shares, so that the portfolio will not be overly affected if one individual stock does badly.
After the building blocks such as medical insurance and the emergency fund are in place, investments will allow your spare cash to grow and finances to take flight. Just ask Ms Seet.
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