Next year, I will be turning 30 years old and I wanted to look back on my twenties and how I managed my finances as well as investments. I think my spending and investments will be significantly different going forward especially when my portfolio has grown, I do want to reduce investments into the riskier and more volatile investments.
Finances in my 20s
I think my 20s was where I survived on a just nice salary in my early 20s and managed to increase it in my late 20s, it was a nice boost but definitely not as much as I wanted or if compared to peers my age. But overall I was lucky to have had a constant stream of income from when I started working in my early 20s till late 20s as the pandemic was a period of uncertainty and now, we are facing another round of uncertainty with automation and AI.
But not to digress from the topic, in my 20s, I have never had amazing bonuses, at most, I just got a 13th month and even in my current job, I do not get a 13th month and my bonus is lesser than one month’s pay. So no lump sum for me and I envy those who get a lump sum of bonuses and are able to think about how they can spend it, what a luxury.
I am thrifty but spend more on food and travel as with most Singaporeans, with that, my savings rate is not huge but comparatively, I do not purchase branded items or clothing and also did not have a gym membership until this year when I turned 29 years old. (Needed to invest in health entering my 30s otherwise, backaches and muscle loss will be settling in) So in a sense, I still stash away a sum monthly.
I was a lot more frugal in my early 20s as I started my first job with $2700 which means I brought home $2160, it might be enough for others but for me, I wanted to invest aggressively so to me, that was just not enough after bills, allowance for parents and daily expenditure. I found ways to cut expenses like bringing food to work and then treating myself on weekends, I also practically used public transport and rarely used taxis which I still practice now.
I was lucky to have no student debt since my parent paid for my studies so I did not start out negative which in itself is a huge privilege that I am grateful for. Entering my late 20s, from 27 onwards, I found a new job (my current job) that provided more progression and better increment but still sucky bonus but at least the base pay was better.
Investing in my 20s
When I started investing in early 20s, I dabbled in Singapore stocks but lost money as I was chasing after dividend yield, I made bad investment choices like Design Studio and a few others which made me lose my capital. I figured then to invest in the index and so started a RSP into STI ETF but over the long run, I figured the returns was not what I wanted and in my mid 20s decided to make the switch to US stocks which I really thank my 25 year old self as it opened a wave of new information and platforms which made me explore cryptocurrencies too. So I kinda took on risk and my portfolio has been on a rollercoaster ride.
To be honest, it was a whirlwind of emotions investing in riskier assets as there are many people who share their thoughts on these investments and you doubt yourself if they are the right asset to hold onto. However, I do also balance up with some index ETFs and I see those as my base. But my portfolio really focuses on a select few.
Finances and Investing in my 30s
In terms of finances going into my 30s, I am currently single (cries) so no plans on any big purchases in the future eg BTO or wedding or significant other to splurge on but I do want to build a larger cash buffer, I actually am super invested right now considering it is a bull market but I like to have more cash on hand either in high savings account or SSB.
Nothing much changes from my 20s as I will still be living the same lifestyle until maybe 35 when I can get my own property, planning for a 2 room flexi BTO but I know how competitive it is so we shall just wait till I am about 33/34 and think about it.
Investing, I think it would still remain the same, maybe more towards index ETF but I think early 30s, I can still afford to be riskier. Anyway, no concrete plans at the moment but building up cash position is definitely more of what I am pivoting to as I do hold a low position of cash at the moment. DCA-ing will still occur as I find that the best way to gain exposure even as the market is at an ATH as we do not know how long the bull market will be.
Overall, I don’t think much will change but when I move towards my late 30s, I do think I will lean toward less risky investments and see how it goes. Have your investments change as you move from your 20s to 30s?
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