For young professionals, saving your first S$20,000 is no easy feat. After reaching this milestone, a new question nags: Should you keep this S$20,000 safe or put it to work? On one hand, high-interest savings are safe and offer certainty. But, on the other hand, stocks offer potential for higher long-term returns.

Before Investing: Ask Yourself These Three Questions

1. Do you have an emergency fund?

Your emergency fund should cover at least three to six months of essential expenses to protect you from having to take on debts or being forced to sell investments at a loss due to a sudden loss of income. These savings should remain easily accessible.

2. Do you need the money soon?

Investing means having to stomach market volatility. If you need that S$20,000 in the near future, whether for further education, a wedding, a home, or other major purchases, investing may not be your best move now.

3. What’s your investment time horizon?

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