IF THERE is one challenge Singaporean women face when it comes to financial matters, it would be investment, as a recent survey on women's financial skills has shown.

In general, they have strong basic money-management skills and the foresight to plan their finances for the future, but when it comes to investing, most are sadly lacking in knowledge, according to the survey.

Singaporean women turned in a composite score of only 51.5 for investment in the MasterCard Financial Literacy Index - the secondlowest score out of 14 Asia-Pacific markets, above only Japan.

Even less-developed countries like Thailand and Vietnam fared substantially better, with scores of 69.3 and 62.7 points, respectively.

But investment does not have to be an insurmountable challenge, least of all for Singaporean women, who are known to be well-educated, capable and smart.

Studies have shown that women generally outlive men by as many as 10 years, but their career lifespan is relatively shorter due to child-rearing during their peak earning years.

This means they have less time to save and plan for retirement, while having to stretch their money over more years due to greater life expectancy.

What's more, savings from monthly salary are increasingly being eroded by the rising costs of living.

Learning to invest - and doing so prudently - is therefore critical in ensuring adequate financial means to last one throughout her lifetime, as well as to allow one the flexibility to pursue her passions.

Ms Chng Bee Leng, head of mass segment for Singapore at OCBC Bank, said that investors should, first and foremost, draw a clear distinction between investing, and trading and speculating.

"Trading and speculating may make you fast money but it is risky.

It can also cause heartaches and leave you disillusioned if your bets go the wrong way," she said.

"Investing is less risky than speculating, but it requires you to do some homework so that you can make informed decisions."

The key, as Ms Chng and other financial- investment experts pointed out, is to get educated.

Investors - whether amateur or experienced - should always seek to learn as much as they can about the available asset class and products in the market. They should never put their money in blindly.

For a start, investors must be able to answer the five basic questions below:

What type of investment product is this and how will it make money?

What benefits does this product offer - dividends, interest or capital gains - and which benefits are guaranteed and which ones are not?

What are the total fees to buy, maintain and sell the investment?

How much does the investment have to increase in value before I can start earning a profit?

What are the specific risks associated with this investment, including the maximum amount I could lose, and how easy would it be to sell if I needed money quickly?

How has this investment vehicle performed over the long run? How experienced is the firm and management behind the investment?

Investors should then choose products that are in line with their financial goals and targets. They should also have a medium-term investment horizon of at least three to five years.

"Having other sources of wealth and a longer time horizon increases the ability to take risk," said Ms Mah Ching Cheng, head of investment communications at DBS Bank.

"It is necessary for all investors to have a proper understanding of their return requirement, risk tolerance, time horizon, investment experience and liquidity requirements, right from the start."

She recommended that new investors who are more risk adverse consider investing in fixed deposits and good-quality (investmentgrade) government bonds, for a start. Those who are willing and able to bear more risk can look into investing in riskier bonds, equities and commodities.

Regardless of one's risk profile, investors must not neglect to ensure proper diversification, experts cautioned, so that the positive performance of some investments will mitigate the losses in others.

Investors thus need to consider how the various asset classes behave in relation to one another.

Random diversification, such as by buying highly correlated equities, would possibly result in greater portfolio volatility.

Investors should note that there are different ways of buying into similar investment products and markets, said Ms Mah.

For example, investors can buy the equities of individual firms, or buy a unit trust that buys shares in many companies. Within unit trusts, investors can also select a money manager that aims to track market returns.

"Do note, however, that they will never be right all the time, so choose a manager who can deliver consistently," she said.

Ms Chng urged investors not to try to time the market, and to review their investments periodically.

"Constant investment over a period of time will allow investors to enjoy dollar-cost averaging of investment," she said.

"Many people, including women, have the misconception that they need to be a financial wizard to invest. This is not true. Don't let the lack of knowledge or fear of financial jargon turn you off."

THIS WEEK'S FOLIO: FINANCIAL PRODUCTS FOR WOMEN

THERE are several financial products in Singapore that cater specifically to women. Here's a look at some of them.

LADIES' CIRCLE OF PRIVILEGES BY OCBC

The product includes wealth solutions such as the OCBC Ladies' Singapore-dollar Time Deposit, which allows customers with a minimum deposit of $5,000 (fresh funds) to earn interest at a rate of 0.648 per cent per annum over a 13-month tenure.

Customers can choose from two investment portfolios: LionGlobal Map Balanced and LionGlobal Map Growth. Investors also have a choice of three insurance packages under MaxLife Protector to meet one's needs at different life stages, with a premium-payment term of 15 years.

MONEYSMART LADIES BY DBS

A regular premium life-insurance plan that also helps customers save and grow their money. It is a two-in-one plan that combines the stable returns of a with-profit endowment plan with the growth potential of investmentlinked funds. Customers can customise their portfolios with the range of funds available.

The product provides a lump-sum insurance benefit upon diagnosis of any six common female cancers (at both non-invasive and invasive stages), or any of the four female critical illnesses covered. It reimburses one biennial check-up plus expenses for reconstructive operations because of breast cancer, disfigurements because of accidents, and skin transplants.

LADY FIRSTCARE BY HSBC

It offers coverage for six female cancers (even at a non-invasive stage) and two common female illnesses, such as lupus and rheumatoid arthritis.

It covers expenses for female-related surgery because of cancer and non-cancer related conditions, as well as reconstructive operations because of accident or assault. It also covers maternity risks, such as congenital anomalies on newborn babies and infant mortality.

Customers can choose a broad range of coverage, from $10,000 to $50,000.

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