Sunday, 22 January 2017

January is coming to an end

When we were asked what we look forward to in the new year, all of us (NSFs) in the unit replied in unison, "ORD!". 

The first month is coming to an end soon. It's been also a year since I started this blog and tracked my finances. In that process, one observation was clear. 

Your career is the single most important source of building wealth

We are told by our parents to study hard and get a degree. Nobody says getting a degree guarantees will give you high income, but nobody is going to deny the fact that working for $1000 isn't a lot and not going to bring you much savings, let alone to do investments. 

While I have been saving diligently from the NS allowance I'm getting now, it does feel painfully slow relying on just one, small stream of income. My friend crafted leather goods, puts it up for sale and it is now another stream of income other than the NS allowance. That will boost his savings and give him more money for investments, provided he does not inflate his lifestyle. 

I am going to try my luck in applying for SIT this year. If it fails, I will head to work and take my career seriously. Then take a part-time degree. 

POSB Invest-Saver 

Since the start of the year, the STI registered good growth. Nikko has also just paid out its dividends, of which I received $30.50 for 505 shares. With capital gains, total return is about $100, 4.22% CAGR. 

With US President Donald Trump's inauguration speech and Singapore's economy not expected to do much better this year, it could go both ways I believe. Since I'm investing in this for the long run and $100 isn't exactly anything to get excited about, I will pay less attention to the stock price. Warren Buffett's quote on whether you are the beef producer or consumer eating hamburgers will help to keep me on track. That said, I will still keep myself updated on global affairs. 


Bought some CDL Hospitality Trust shares this month at $1.40, making it my 2nd REIT. I wanted to buy at $1.34 in December but was comparing it to M1 at that time. Now M1 has slightly rebounded as well, damn. It's alright, considering I never even opened M1's annual reports or try to understand the telco sector. Am I buying M1 for dividend or growth? Still trying to think about it. 

Time to wait for the earnings report on 26 Jan to see how it fared. I will write how I rationalise my decision in another post.  

Time to farm the angpaos and good luck. 

Happy early Chinese New Year! 
Gong xi fa cai!

Sunday, 4 December 2016

2016's Reflection

*Apologies to everyone who read double. I have made a serious mistake of leaving the other 1st draft inside the post. It's now corrected."

2017 is coming in a little less than 1 month! Hence, it's time for a reflection to see how I fared throughout 2016. It's also time to take stock of all my growing up years and plan ahead for 2017. 

On human capital,

In 2016, nothing has changed.I graduated from polytechnic in 2015 and I have less than a year now to completing my National Service. I have been thinking about furthering my studies and it's an answer that I am still unclear of even after a year into NS. Do I apply for full-time university or join the grind and study part-time? To be honest, I won't have to face this dilemma if my grades were good enough for full-time NUS or NTU. I believe a few other factors hold me back from even trying for the other university, SIT. 

The age factor is always at the back of my mind. I'll be more than 25 years old. It doesn't help that I was from the Normal Academic stream so that added a year of studies. I feel old. 

On the other hand, I see an incentive for me to join the grind and study part-time. At least if I find what I really like, then I can go for part-time studies in that field while earning an income. There are even options like the SkillsFuture Earn and Learn Programme where fresh ITE/Poly graduates hitch up with companies and even get paid cash(Singapore Citizens only). Any readers in this programme and would like to share your experience?  

Earlier in the year, I started basic Japanese classes over the weekends and it's a huge joy in learning. I hope to continue learning in 2017, but may have to pause going into the later half. For now, I hope what I have learnt will come in handy next year in Japan, even though it's probably a speck of English and Japanese.  

On financial capital, 

My Financial Goals is on track, with a comfortable surplus. I count myself lucky as I only pay for food when I'm out with friends and I don't pay my own bills. So far, I have managed to save a few thousand dollars from National Service allowance. I have tracked an entire year of my expenses and Nikko AM STI ETF investments on Excel. It's a habit now and it's this conscious effort and reminder that I am ultimately responsible for my financial health. 

I made my first real stock transaction by making a purchase of some CapitaMall Trust (CMT) shares at $1.91 recently. I think the purchase of shares will be in another post and I hope to document the rationale in my decision. 

Insurance is particularly important to me as I don't want to be a burden on anyone if something happens to me. I upgraded the Term Life Insurance to $250k and $500k for Personal Accident under the SAF Group Term Life insurance. I will pay greater attention to Critical Illnesses in the coming year. 

On the intangibles, 

Over the years, I came to realise that the initial thrill that came with purchasing material things did not last long. In a graduation trip with my friends, the leather bag that I bought for a discount is now rarely used, but the memories of doing crazy things together stay with me forever.

By being actively conscious of my expenses and also trying to mimic a minimalistic style, I believe my financial health will also thank me in the long run. It's the simple things in life that matter. Moving forward into 2017, I hope to spend less time and effort on pursuing unnecessary material things, and improve my kinships and friendships. 


Many questions lie ahead for me in 2017 and I am apprehensive but also optimistic.  A reflection would not be even possible if not for the fact that I am still alive. I'm grateful that I am still kicking and wish for good health for everyone in 2017! 

I shall end with a quote by Abraham Lincoln: "In the end, it's not the years in your life that counts. It's the life in your years". 

Merry Christmas and an Early Happy New Year? 

Till next time, 

Sunday, 25 September 2016

Value-for-money: Kinokuniya or Booksdepository

Meet Kinokuniya and Books Depository. 

The former has physical brick-and-mortar and online stores while the latter is solely an online retailer. 

For all the book lovers out there, I am sure these are some of the places we go in order to satisfy our book cravings. Kinokuniya was where I picked up my first book on investing. I summarised some of my thoughts on that book here. Since then, I have bought at least 6 other books on investment and other genres that cost at least $200 in total from Kinokuniya. 

Book lovers should also know that Kinokuniya is not the cheapest for pricing. I came to know Books Depository recently, and boy is there a huge difference in price. 

Let's compare an investment book, say Common Stocks and Uncommon Profits and Other Writings. 

On Books Depository: $18.56, original price: $30.03 

On Kinokuniya: $37.40, member's price: $33.66 

If we are to compare prices only, then we have a clear winner here. Kinokuniya is still more expensive than Books Depository, even with their member's card. Books Depository seem to be always holding discounts when I visited the website. In addition, there is free delivery for Books Depository, though I am not sure how long the delivery takes since I have not tried it. 

But are we missing something here? 

I love the smell of books. I love how you can walk in and be greeted with just books. This is something, well, a physical experience you cannot replicate on an online store. I am sure some will walk into Kinokuniya, then order the book they want to buy from Books Depository. 

To be honest, I have also thought of it. But ever since I've learnt that Books Depository exists, I am still attracted to the physical mortar store. I still go to the mall, wanting to pass time and sometimes go home with a book on hand. The flagship Kinokuniya store at Ngee Ann City is full of people from all walks of life, with parents bringing their kids with hopes of kickstarting a reading habit from young.  

I suppose it's also how I guess when you get out of your house, you tend to meet a new friend, maybe of the opposite sex, who shares the same interest(well, I haven't, haha). 

The higher prices in Kinokuniya are obviously then, due to rent, and labour. I don't think physical bookstores will disappear completely in face of e-commerce. As much as I need to cut spending, I will support whenever I can if it's still within my budget. We can't move everything to e-commerce or e-books, can we? Sometimes, it's the physical experience that really matters.

To the book lovers out there, how do you purchase your books? 

Till next time, 

Saturday, 17 September 2016

My Insurance Policies

Too expensive. A waste of money. I don't need insurance. I don't know how much I'm covered. My parents bought insurance for me and handles it. 

These are just some of what people say. I've had some friends who said that when the topic is broached. Insurance isn't easy to understand at all! 

So many policies, so many insurers. To be honest, I'll still choose to let my parents handle it all. But I'm no longer a little boy. I took it upon myself to understand all my policies that my parents bought and which are the policies that I bought on my own. As to how it really started, other than me turning 21, it was also partly due to me wanting to know what I am actually buying. 

So it is time to look into the policies I have. Readers who know more about insurance, feel free to correct me on any point. Gladly appreciate it! 

Life Insurance

CPF Dependents Protection Scheme

Covers every CPF member from 21 years old and insures $46,000 in event of death or Total Permanent Disability up till 60 years old. 

Review: This is a no-brainer. I'm keeping this. Yearly premium is $36.00 now(note: premiums change with age) and paid through Ordinary Account in CPF.  

SAF Group Term Life/Group Personal Accident 

This is what every male who went through NS will probably have. I'm currently only insured $100,000 for Term Life and Personal Accident, paying $12.80 a month. After 1st October though, with the same $100k coverage, I only pay $5.17 a month. Half price.  

Review: Is $100k coverage for Death enough? No, if I die. My parents raised me up and I should at least make sure their retirement is comfortable if I am to pass away. If I do not die, but become permanently disabled or lose a limb due to an accident, then the Personal Accident(PA) will come in. So I'm planning to increase to $300k for Death/TPD and $500k for PA for now. There is group risk and hence, some limitations to policy cover. I will try to look for alternative insurers to diversify. 

AIA Whole Life/Prime Life/Financial Guardian x2 

My parents bought this 4 plans when I was 1-2 and 6 years old. The sum insured is only $42,000 in total and premiums are close to $500 a year. This comes with cash values and there are surrender values. Covers Death and TPD. 

Review: $500 a year isn't cheap for $42,000 coverage. It is a 100-year policy, though $42,000 will be grossly insufficient many decades down the road. I should see the returns in the cash value then. I don't mind such plans if I'm comfortable with the returns. Am trying to assess AIA eCare for latest data. 

Hospitalization Insurance 

I have a Great Eastern Supreme Health Plus B (Integrated Shield Plan) and premiums are $259 for age 21-30 now with no rider. 

KK Hospital Class B1 ward(4 beds)
Review: No-brainer, a must-have. According to the policy, I'm entitled to class B1 wards in government hospitals. I think I will be comfortable with B1 ward. As to whether I will want to add the rider(need to pay in cash), I think it is a good idea. As a young adult, the rider will help to pay the deductible and co-insurance and allow you to build your own Medisave and cash savings first. 

Disability Income 

I have not joined the workforce, so this Disability Income does not really apply yet to me, but I will be keeping it on my radar. 

Critical Illness/Early Critical Illness 

AVIVA seems to offer immense value in the Group Insurance Living Care and Living Care Plus Critical Illness(CI) policies. 

Review: The way I view it, CI plans are a must. Even if the ISP with rider should cover most medical expenses, the time required to get back to work can be a few months to a year long. In the meantime, Early CI(lower chances of dying) should compensate for the income loss. I'm aiming for $100k coverage for CI and early CI for now.  

AVIVA Living Care Plus Premiums
AVIVA Living Care Premiums

It will be difficult to talk about insurance because honestly, it is pretty boring. Who gets friends talking about it? But among some friends, I find that they are not understanding insurance enough. Some prefer to only know when they go out working or leave it all to their agents, without sufficiently understanding their own circumstances. For me, I will want to know what are the specifications of the product first, just like before buying a gadget. 

Still lots of hard work ahead. My gratitude to the financial bloggers who wrote a lot on insurance. It has been of much help. 

Till next time, 


Sunday, 21 August 2016

Thoughts on the Book: A Random Walk Down Wall Street

Random Walk
One in which future steps or directions cannot be predicted on the basis of past history

Around late last year, I sat down with my first ever book on investing/finance: A Random Walk Down Wall Street. I didn't know what to expect then. 

At its core, the book says you should just buy index funds and make it the core of your portfolio, manage it passively. Of course, then buy some individual stocks if you want the excitement. 

In other topics which stood out the most to me, The Fitness Manual presents exercises such as: You must start to save and start early, build reserves and insure yourself, be competitive with your reserves, make use of tax relief by putting money in retirement plans, understanding your investment objectives with a sleeping scale. 

The Life Cycle Guide presents how you can assess your risk based on age, and how the allocations like cash, bonds, stocks and real estate (REITS) can be rebalanced as you age. 

Behavioral finance is talked about, and the lessons from history also stood out to me. 

In valuation, there are basically 2 techniques: Firm foundation and castles in the air. The techniques of fundamental and technical analysis are debated in the book. 

Being a newbie, it was harder to understand the Efficient Market Hypothesis (EMH), Modern Portfolio Theory (MPT), pricing models and the debate on smart beta in the book. 

I felt that the writing was written with the layman in mind, with many analogies and statistical examples. The first part of the book teaches you to always remember the past lessons and relate how your own psychology is often your biggest enemy in investing. The middle of the book got a little more complicated with EMH and MPT. The last part of the book finishes it off with how you can conduct the walk with indexing. 

As it was the first serious investing book I read, it was generally easy to read and I found myself leaning slightly to some of what the book proposes. Of course, more than just being a teacher, the book also kicked off other habits. I started to read the Invest section of the TheSundayTimes. I started going to Kinokuniya to satisfy the craving for knowledge. I also bought and read The Intelligent Investor by Benjamin Graham which was a far more difficult book to digest. 

Knowledge is power 
Francis Bacon

Till next time, 

Saturday, 30 July 2016

POSB Invest-Saver RSP Update

If I am to describe myself as an investor now, I will probably be an index investor. It has since been about 9 months ago that I subscribed to Invest-Saver. There were a couple of reasons that got me started. 

Firstly, I wanted to get started with stocks, secondly, learn about investing with a small capital and lastly, to discipline myself financially. 

9 months on, how did it fare? 

Dollar-Cost Averaging

$100 goes into the RSP monthly, except for June's amount of $200. 

Total Investment Costs and Cumulative Portfolio Value as of 30 July

Capital Gains/Losses as of 30 July

There were dividends of $2.93 in January and $10.59 in July. 

Total Return is $17.64 as of 29/7/16 which includes the dividends minus the commission costs. (Note that a few months back, the STI was really volatile and Total Return was negative, so it isn't all rosy always). Current share price stands at 2.93 as of 29/7/16). 

I am going to continue this plan until my ORD because that's when my cash flow stops. There was no particular reason for putting in $200 in June other than trying out the ATM function. 

There will always be different expectations of returns. A fellow army mate shared how he can win hundreds in a casino, another won hundreds in the recent World Cup. So when this topic came up, it's quite apparent that the returns are low and volatile for this Invest-Saver. But one of them signed up after he realized that time and the value of compounding could help here. To each his own. 

So I tell myself that in time, this RSP will shine even with corrections in the STI. I must be able to wait out those falls and be in for the long haul. 

Till next time, 

Monday, 18 July 2016

Don't let your smartphone be in control

No, I am not talking about the rise of artificial intelligence but rather on how we folks today are increasingly gluing our faces onto our smartphones. 

Singapore is ranked the highest globally in mobile penetration rate, read this here. Well, we do see almost everybody using a smartphone here, so much so that there are rising cases of zombies. In South Korea, authorities have tried to mitigate their smartphone zombies apocalypse. 
Photo from Asia News Network

Now, if you are reading this post while crossing the road, I suggest you put your phone into your pocket. If you are walking down the stairs from the train platform, please put away your phone.

The rise of the smartphone zombies

There were a few cases, whereby the person in front of me was watching a drama show, and she was so slow in walking down the stairs that everybody behind me was obviously annoyed. There were another instance, where I tapped on the shoulders of a guy in front of me, simply because he was walking too unpredictably while using his phone. I am not about to get stepped on in a stampede. 

I am sure we have been taught road safety from young to look left and right while crossing the zebra crossings and traffic lights. I make it a point till today but I observed some pedestrians just crossing the road while their faces were still glued and earbuds inside their ears. It's like as if the smartphone rips you of your senses and gives you a false sense of safety. 

Maybe we do need such signs like those used in South Korea too. 

Use your phone at the right time

Ever heard of the "If you see any suspicious article or person, please contact our staff or call 999" while taking the MRT? In light of recent terror attacks, I think it is being played more frequently but it seems many of us folks are glued to the screens until we probably won't know if the guy next to us left something behind or not. 

I am guilty of that. At times I can be very vigilant, doing my part to look around, at times I am scrolling through my Facebook feed or just turning on the screen for nothing. We take things for granted here. 

I am not dismissing smartphones for they have its benefits too. Accessing social media gives us the latest news on what is happening. We can plan an alternative route immediately even before reaching the station if we know of a disruption in the MRT system. 

But if we can use them at the right time such as not using it while crossing the road, or walking down the stairs or while traveling in the trains, I am sure that is a positive for our own safety and our loved ones too. 

The next time you whip out your phone, make sure if it's safe to do so for yourself and others. Remember, you are in control. 

Till next time,