Sunday, 7 January 2018

How to retire and still survive

Recently I came across this YouTube channel BeatTheBush who describes himself as being an engineer and together with frugality, side incomes and investments he managed to quit his job and have much more time to do what he wants at a relatively young age!

Here are some of his videos firstly about how he tracks his net worth and the spreadsheets are available in the description box. The video explains thoroughly on the spreadsheet and what values should be input into where. 

I chanced upon his channel one day while surfing YouTube and realized that some of his video are quite informative and he was willing to share about his experiences on how he saved money. He also has a few videos on how he prepares $1 meals or a low budget seafood meal. Its interesting because his journey towards him being able to quit his job and not needing to find another interest me to know how he did it.

On some videos, he tries applying for credit cards just for the rewards and then to cancel them when he gets the rewards. He also touches on Bitcoin and how he profit from it. Overall, even though its a rather new channel, I believe that he can help provides tips on how he manages to achieve his current lifestyle with his side incomes which includes the YouTube channel and Amazon where he sells his stuff.

I like to read up on financial articles or blog post but once in awhile, a video can make things look more visually appealing hence I would get on YouTube and search for financial videos to look through at times. Just some thing I would like to share and hope that you guys would enjoy it too!

Saturday, 6 January 2018

Investing with a peace of mind

Understand your risk tolerance

It’s important to know your risk tolerance like low risk, mid risk and high risk. People who have low risk tolerance would generally prefer investments that protect their principal amount and most investment that can protect the principal amount usually provide lesser interest. Mid risk is where you are okay with acceptable interest and have a certain amount of risks involved. High risk investments usually means that your capital/principal amount is not protected and you can lose a substantial amount of your investment.

Your age can also determine your risk tolerance, for example someone in their 20s would have a different risk tolerance than someone in their 60s. This is because in your 20s, you know that you can still earn back even if you have lost a huge amount of money as time is in your favor. On the other hand, in your 60s you most likely would be retired and know that you will not be earning that well.

It is important to figure out your risk tolerance to know what sort of investment products fits you so that you are able to sleep soundly at night and not worry about your money invested.

Get yourself prepared for market volatility

When you get yourself invested, it’s common for fluctuations due to bad news, good news or even no news. You have to make sure that you are not too affected by the fluctuations. Becoming paranoid and fearful is definitely not why you invested, you have to prepare yourself by doing sufficient research and know that it is going to be a long term investment.

Getting yourself prepared can also be by using money that have been put aside and is not your emergency fund.When investing, there is always a form of risk in it. It is really important to prep yourself for what you are about to face so that you can have a peace of mind. To be honest, when you first start investing you will get so excited about checking the price fluctuations. But after awhile, you will slowly get used to it.

Diversify your portfolio 
This is most commonly heard of when people want to reduce the risks that they will have when investing. This can be explained simply by comparing 2 person, one with purely equity/stock holdings and one person with equity holdings, bond holdings and gold. When a market crash happens, the person with just an equity portfolio would suffer much more compared to the one with an equity, bond and gold portfolio. Best saying to describe this is "Don't put all your eggs into one basket".

This is also especially true in terms of income, for example, I hope to be able to create multiple streams of income in future so as to reduce the load on my main full-time income. Traditionally, we depend on one main source of income and when that is removed, most people would worry same as the person who has only equity holdings in his portfolio and the market crashes. So I hope to also diversify my income just as I will diversify my portfolio.

Create and monitor a financial plan

It is good to have a financial plan to be able to know your goals and whether you are achieving them. So let's say you have started investing for awhile now and you check back and realize that you are not achieving what you have set up to. You can then check and analyze and find out what are the reasons causing you not to reach your goal and if changes can be made, you can tweak and improve your strategies.

A financial plan is also important as investing is a long term journey, it is not going to end after one or two years hence you will need a rough guide of what you hope to have and how you are going to achieve them. This can help you have a peace of mind if you can achieve the milestones set up from the beginning and know that you are on the right track!

As 2018 unfolds, we all hope to have a good year and changing our attitude and behaviour can go a long way😀 Let's work hard and do our best!

Sunday, 31 December 2017

56 years old with $1,000,000

I have posted about the allocation of my funds for when I start working and for now, I  have set a limit of $448 per month to investing. Since I would most likely be saving it before putting them in to the stock markets at the right time, I have used an annual percentage yield of about 8%.

Below I have used the number application on a Mac and inputted numbers of my saving rate, current savings I have right now and to have an annual percentage yield of 8%. A saving goal of 1 million is inputted to see how long I would take to achieve that.
The diagram above of course do not put into account of increasing input or reduction of cash input. It will approximately take me 34 years to get to $100 0000 with a monthly contribution of $448 at an annual percentage yield of 8%. So I am 22 this year, adding another 34 years would make me 56 years old.To me, that's amazing.

Coming from an average income family and a single parent family money has always been an issue. For example, my brother has been accepted into a prestigious university in London however my mum does not have the capabilities to send him there and can only rely on a scholarship which he hasn't yet gotten. Another simpler example would be that she most likely would need to work a few more years even after retirement age. Being able to envision the 1 million and have it as an attainable goal really spurs me on because I want to be able to contribute to my family and improve the standard of life for my mum like letting her travel and have good food.

With increasing contributions over the years for example the first year I contribute $448 followed by $558 the next year. This should help reduce the number of years needed. To be honest, I do have a fear of investing a huge portion of money into the stock market. For example, I hope to achieve a passive income of $40 000 per year hence I would need approximately $500 000 invested at a yield of 8%.

Having half a million invested in the stock market is scary for me, right now I have a small sum of money invested and I am young hence I am not that paranoid about the money invested. I believe many people have been advocating diversification of funds to reduce the risk which will reduce the paranoia that I think I will feel. So my next post will be on how to reduce investment stress! Do look out for it 😉 Goodbye 2017! It's been a good run.

Saturday, 30 December 2017

Year-End Review of portfolio

This is my first year end portfolio review as I only started investing this year. So total counters for 2017 came to 7 and most were bought in the second half of the year meaning that I missed out on dividends and so dividends for this year quite low.

As of 30th December 2017,

Current costs for stocks/shares is at $5741.81, current value is at $5975.80 meaning a P/L of $234.03.

Total Dividends collected this year is $87.61.

Using StocksCafe, my time weighted returns is at 19.38% for 2017 compared to a -2.33% in 2016 hence bringing my overall to a time weighted return of 16.59%.

The time weighted returns for my portfolio is not bad to me but comparing it to ES3, it does lose out and mainly during to my returns in 2016.

For my dividends which I am looking forward to in 2018 has been projected by StocksCafe to be $336.88, giving me an average of about $30.63 which can be used to cover my phone bills as I am currently using the SIM only plan with Singtel at $20/month. Haha, it is a really good feeling knowing that your investments can cover certain portion of your monthly spending and I think for me that is the greatest driving force for me to save and invest for the long term.

Overall, I am quite pleased with my current holdings and hope to increase them in 2018 if I have sufficient capital. If not, I would slowly build up my cash holding and add more stocks into my watchlist before making any decisions. Do give feedback or any tips to me 😆

Friday, 29 December 2017

Reflection of 2017

Another year is coming to an end and I don’t usually write reflections but reading the various reflections from various financial bloggers have inspired me to do a reflection too. I think it’s also good to have a reflection done because during your 20s, every year really builds up a lot for you in terms of career, family and other aspects.

Today is the last working day of 2017 although many are on leave but being an intern means having to be in the office. 2017 has been a huge year for me. From beginning to invest and getting an internship, I have learned many things and that learning is a constant journey. During this year, I have also started blogging more frequently and to pen down my transactions and personal experiences. I hope for 2018 to be exciting and for me to have more initiative to learn new things.


1. Started investing

This year I started getting into investing. Previously, in end December 2016 I started a regular savings plan (RSP) with POSB saver and I got to say that was my best investment so far as I managed to purchase Nikko AM STI ETF at $2.80 onwards which right now has allowed my portfolio to have gain quite a lot.

Next, around May 2017 I created a CDP account and a DBS Vickers Upfront Account mainly because of the lower transaction fees that I can get. So my first trade was SGX and I managed to snag it at a price of $7.22 (without transaction fees) which to me was pretty okay.

I have been saving money in a bank account before 2016 hence I became a little addicted after purchasing my first stock and I went on to purchase a few other counters. So I ended 2017 with 7 counters namely STI ETF, Nikko AM STI ETF, SGX, First Reit, Amara, Tai Sin Electric and Design Studio. Of course, going into the new year, I will be looking out for stocks to snag at a low/reasonable price and also with a certain level of dividend payout. I hope to of course increase my financial literacy level and understand more about fundamental analysis.

2. Manage to secure an internship

During my holidays this semester, I managed to get an internship as a human resource (HR) intern. The degree that I’m studying is in psychology and it allows me to also get into HR and I would like to widen my exposure hence getting an internship in a company as a HR intern has allowed to know the workshops and necessities of being in HR.

Also, as I will be unofficially graduating next year end so an internship will also help boost up my resume hopefully. To be honest, even though I am graduating soon and entering the workforce I am still very unclear as to what I want to do. I do feel lost and am just riding the waves that come along. So I do hope to have a clearer goal of my future in 2018 if not, I will still be search for the route.

3. Progressed to the next semester for my studies

This sounds really ridiculous and lame but I really am pleased that I managed to progress to the next semester and with quite satisfactory results. This is because the modules that I took the previous semester was really technical and mostly essay questions were tested hence at one point of time, I felt really stressed out and even thought I would repeat the module/semester because this module also has the highest failing rate. The lecturer also consistently reminded us that the passing rate was low and we all had to start early.

Well, I can only blame myself for not starting earlier with the revisions that’s why I faced immerse stress before my final examinations. Hopefully, next semester would be a better one where I will start earlier ( I always say that but you know how it ends up, haha)

Overall, 2017 has been a year of growth for me and my family has been well and healthy so I am exceptionally grateful for that. I personally feel that it is very important to give thanks and be appreciative to be able to appreciate the little things in life. I have learned that I should not take things around me for granted and that everyone and everything that has happened has a learning point for me. Going forward into 2018, I hope to brush up on my communication skills as I am rather shy and require time before I dare to speak my mind to people. Other than that, 2017 has been a wonderful and amazing year especially since I started investing.


Sunday, 24 December 2017

Singapore Savings Bond

I came across Singapore Savings Bonds when reading through a few financial blogs like ASSI, investforyourself and Seedly and they mentioned about some benefits of the SSBs. I read through the posts by them and found SSBs to be a good parking place for extra cash.
Being a cautious investment who looks for investment with low risks and hopefully mid returns, SSBs seem like a pretty good investment with returns. I realized it is a pretty good balance/diversification to my stocks portfolio.

Besides being a good diversification to my portfolio, my mum is reaching retirement age soon and I have recently reviewed her assets/cash and realized that all these years she has been keeping her money in the bank. I felt that it was pretty wasted as her cash was not put to good use and really the yield was mostly sad. Well, what’s done been done so I told her about the SSBs being a better alternative to the bank account, it was pretty tough getting her to trust me but I’m glad and now she has placed some of her savings into SSBs.

I hope that more people can find out about this because I find it a really good investment option for people who are afraid to invest in stocks but don’t want their money to earn only a low interest in the bank. The SSBs is really a good place to park your extra cash at.

1. Singapore Saving Bonds

So assuming a person decides to put $20 000 into SSBs and let's assume it's for SBJan2018. The interest rates for SBJan2018 is showed below. Using the interest calculator provided by SSB, we can see that the total interest earned when held to maturity of 10 years would be $4328. We can also see that the interest payout increases each year.

2. Fixed Deposit

On the other hand, assuming another person has $20 000 and places it in a fixed deposit with 1.15% interest per annum. We will assume they place it for 10 years. The total interest earned would be $2422.75 for 10 years with $20 000.

SSB is a better choice in that the interest is compounded and hence interest payout gets higher every year. SSBs also provide better liquidity where a month of notice is needed to get back your cash, no lockup period is enforced. Do note that $2 is required when you place your money in SSBs and when you want to take it out earlier it is another $2.

Friday, 22 December 2017

How to save money?

1. Prepare lunch at home

Early this year, I started cooking my lunches and pack them to school. They usually consist of chicken and rice or a sandwich. I found I saved pretty much as my school's canteen food is not subsidized and can cost anything from $4 onwards. So by purchasing chicken from the supermarket, rice and eggs, my lunch amount can be reduced to an amount of around 1.50-2.00 per meal.

2. Selling things on Carousell and use the money as supplement to expenditure
 I did doubt before I started using Carousell on whether or not people would actually be willing to purchase my used or old items. However, after I put my first two items, a toy and a comic book which got snag up within a few days, I was intrigued that there was a community who was interested in getting items at a lower prices event though they are used or old.

After I have managed to sell items off Carousell, I would use that money (not a huge amount) to either help supplement my daily expenses or to get something I need.

3. Compare item prices before making purchases

I have experienced this so many times where I bought something and after which I found something cheaper from another place. Online purchases right now has made things so competitive and there will always be a cheaper alternative. But it matters when time plays a part. Online purchases can take up to few weeks and when what you want to purchase is in a rush then definitely getting the item fast would be your priority.

4. Getting hand-me-downs from family members

The hardest part of this is the asking part but since most of my cousins are into online shopping and frequently need space in their closet. I would ask them if they have any clothes that they can pass down to me. Of course, the clothes need to be of good condition and presentable.

It is always good to reduce our expenditure (of course not to an extreme) but to lower it so we can use the spare cash to generate more income which in future can be used to cover our expenditure. Hence, a lower expenditure would allow us to cover our expenditure at a lower cost of investment. A cycle that can bring us forward in the journey towards financial freedom! Cheers!