• Importance Explanation: Shielding assets from legal liabilities • Examples of Events: Legal structures, Insurance policies, Trust, etc • Resulting Benefits: Protection from legal claims and creditors Emergency fund: I can't mentioned how extremely important that it is. Emergency fund are the funds are ready for your family to access in the event of any unexpected events. That can be illness stops you from earning your regular income; family unexpected expenses could be interest rate hike, your car broken down, your roof needs to be change or you need to go to visit your foreign parents and so on. This is so important because without it, you can put your family in a very stressful possition. For instance, as of 2023, borrowing costs have surged threefold compared to the period of 2021-2023. Numerous investors and homebuyers stretched their mortgage limits, anticipating interest rates to remain stable. Unfortunately, the rates have risen rapidly, catching many off guard. If, for example, you were previously paying $2000 monthly for your mortgage, you may now find yourself faced with a doubled obligation of $4000 per month. Diversification and asset allocation are two fundamental pillars of a well-rounded investment strategy. Diversification involves spreading your investments across a range of different assets, such as stocks, bonds, real estate, and commodities. This strategy is grounded in the idea that not all investments move in the same direction at the same time. By diversifying, you reduce the risk of your entire portfolio being negatively impacted by a poor-performing asset class. Essentially, it's the principle of not putting all your eggs in one basket.
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