Risk Tolerance Assessment

Find your family's investment risk tolerance level.

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1. How long can you leave your investment untouched?

2. If your portfolio dropped 20% in a month, you would:

3. How stable is your household income?

4. Do you have at least 6 months of emergency savings?

5. Your primary wealth goal is:

Medical Disclaimer: This tool is for educational and informational purposes only. It does not provide medical advice, diagnosis, or treatment. Results are estimates only. Always consult a qualified healthcare professional for medical decisions. In an emergency, call 995 (Singapore) immediately.

Risk Tolerance: How a Baby Changes Your Financial Profile

Risk tolerance is how much investment volatility you can stomach without making panic decisions. It's shaped by your time horizon, financial obligations, income stability, and emotional resilience. Having a baby typically shifts your risk profile - you now have dependants, increased expenses, and often reduced income during parental leave. Understanding this shift helps you build an investment strategy that doesn't leave you exposed at the worst moments.

Risk Profiles: What They Mean in Practice

Conservative

Prioritises capital preservation over growth. Can't sleep if the portfolio drops 10%. Short time horizon or high fixed obligations.

Portfolio: 70–80% bonds/fixed income, 20–30% equities

Rebalance: Rarely. Focus on income, not growth.

SG examples: SSBs, fixed deposits, CPF SA top-ups

Moderate

Accepts some volatility for better long-term returns. Can ride out market dips if the goal is 10+ years away.

Portfolio: 40–60% equities, 40–60% bonds/balanced

Rebalance: Annually or after major life events.

SG examples: Endowments, balanced unit trusts, STI ETF

Aggressive

Comfortable with 20–40% portfolio swings. Long time horizon (15+ years), high income, stable job.

Portfolio: 80–100% equities, minimal cash drag

Rebalance: Quarterly or when allocation drifts >5%.

SG examples: Global ETFs (CSPX, IWDA), growth stocks

Life Stage and Risk: A Timeline for Singapore Parents

Life Stage	Suggested Profile	Why It Changes
Pre-baby, dual income	Moderate to Aggressive	Long horizon, high income relative to expenses, no dependants.
Pregnancy period	Moderate	Income may drop with leave approaching. Build emergency fund, reduce volatility.
Newborn to age 3	Conservative to Moderate	High cash needs (childcare, medical). Keep 12 months expenses in liquid, low-risk assets.
Children in school (age 4–12)	Moderate	Education costs become fixed. Mortgage in mid-stage. Balance growth vs safety.
Children in secondary and beyond	Moderate to Aggressive	Education costs peak then end. Renewed capacity to take risk. Retirement in sight.

Three Rules for New Parents

Never invest money you need in under 3 years

Childcare deposits, Medisave top-ups, and emergency funds should sit in cash or SSBs, not equities. Market timing is unpredictable.

Insurance first, investment second

Ensure you have adequate life cover, CI insurance, and hospitalisation cover before growing your investment portfolio. A medical emergency without cover wipes out savings faster than any market crash.

Review your risk profile after every major life event

Birth of a child, job change, property purchase - each event shifts your risk capacity. Schedule an annual financial review with a fee-only adviser or use CPF's resources.

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